As the tax landscape shifts in 2026, charitable giving strategies will play an increasingly important role in both philanthropic impact and personal tax planning. Several new federal rules are taking effect this year, reshaping how deductions work for donors who itemize and for those who take the standard deduction. Understanding these changes—and how to position your gifting strategy accordingly—can help you maximize both the tax benefits and the charitable value of your contributions.
What’s Changing in 2026:
A New Deduction for Non‑Itemizers
One of the most significant updates is the introduction of an above‑the‑line charitable deduction for taxpayers who take the standard deduction. Beginning in 2026, non‑itemizers may deduct up to $1,000 for individuals or $2,000 for married couples filing jointly for cash gifts made to qualified public charities. This marks the first time since temporary COVID‑era measures that non‑itemizers can benefit from charitable deductions on federal returns.
However, it is important to note that some types of donations do not qualify for this new deduction. Contributions to donor‑advised funds (DAFs) and supporting organizations are excluded from eligibility for non‑itemizers.
New Limits and Floors for Itemizers
Taxpayers who continue to itemize deductions will experience notable changes that affect the value of charitable giving. A new 0.5% of Adjusted Gross Income (AGI) floor means that only charitable contributions that exceed this threshold will be deductible. For example, if a donor’s AGI is $200,000, the first $1,000 of charitable contributions will not generate any deduction benefit.
In addition to this floor, high‑income taxpayers may experience reduced deduction values due to new federal caps introduced under updated tax policy. These adjustments are likely to make charitable planning more nuanced, especially for larger gifts.
Continued Eligibility for Non‑Cash Gifts
While several 2026 provisions affect deductions differently, the rules for non‑cash charitable contributions, such as gifts of appreciated stock, remain unchanged for itemizers. Donors may still deduct the fair market value of these assets, subject to standard IRS documentation requirements, including written acknowledgments for gifts of $250 or more and appraisals for higher‑value contributions.
Strategic Use of Appreciated Securities
Gifting appreciated stock remains one of the most tax‑efficient ways to support charitable causes. By donating appreciated assets directly, you may avoid capital gains taxes while potentially receiving a fair‑market‑value deduction (for itemizers). Our team can help you identify optimal securities to gift, coordinate transfers, and evaluate the tax advantages under the new rules.
Donor‑Advised Fund Planning
DAFs continue to be a powerful tool for donors who itemize, especially when used to “bunch” multiple years’ worth of gifts. While DAF contributions do not qualify for the new non‑itemizer deduction, they remain fully deductible for itemizers who exceed the AGI floor. We can help you establish or fund a DAF, manage ongoing grants, and align your charitable goals with long‑term tax strategy.
Qualified Charitable Distributions (QCDs)
For donors age 70½ or older, QCDs from IRAs remain an effective way to fulfill charitable goals while reducing taxable income. QCDs can satisfy Required Minimum Distributions (RMDs), which may be particularly attractive given the new 0.5% AGI floor for itemizers. Our team can work directly with your IRA custodian to structure QCDs properly.
Customized, Forward‑Looking Plans
Our advisors can compare scenarios under both 2025 and 2026 rules, model the tax impact of various giving options, and help you choose the most advantageous strategy. From compliance and documentation to asset selection and timing, we provide a comprehensive approach to charitable planning.
Your Philanthropy, Empowered
As the charitable tax landscape evolves, thoughtful planning becomes even more essential. The Central Trust team is here to help you navigate these changes with clarity, confidence, and a strategy tailored to your values and financial goals.
This material is for informational purposes only and is not tax, legal, or accounting advice. Please consult your tax professional regarding your individual situation. Pursuant to U.S. Treasury Department Circular 230, this communication is not intended or written to be used for the purpose of avoiding federal tax penalties.
