Many Americans spend hours every year during tax season adding up their various deductions, including charitable donations, only to find that they actually owe less (or get a larger refund) if they take the standardized tax deduction than if they itemized their deductions.
Starting with the 2026 tax year, taxpayers can take the standard deduction and also deduct one charitable deduction. The change is a result of the “One Big Beautiful Bill” signed into law last year that makes a number of changes to tax regulations.
An “above-the-line” deduction
This particular change allows taxpayers to deduct up to $1,000 in cash donations to qualifying charitable organizations for those with a single filing status and up to $2,000 for married couples who file jointly, even if they don’t itemize their deductions. It is considered a “permanent” change in that there’s no sunset clause for it.
This change can help encourage more lower- and middle-income taxpayers to make charitable donations and see some tax benefit even if they don’t need to itemize their deductions. It doesn’t include contributions to a donor-advised fund (DAF). However, it covers the type of cash donations that most people make to charitable organizations.
Other changes from the sweeping new tax law
Starting this year, the income thresholds have also risen for being able to use the standard deduction. For example, they are $16,100 for single filers and $32,200 for married couples filing jointly.
Another change this year related to tax donations pertains to those with higher incomes. There’s a new “floor” of 0.5% of adjusted gross income (AGI) for deductible tax donations. That means, for example, that if someone’s AGI was $500,000, the first 0.5% or $2,500 of their cash donations wouldn’t be deductible if itemized. Of course, high-income filers who make significant charitable donations can find other ways to get the most tax benefit from those deductions.
When control of the executive and legislative branches of the federal government changes hands – particularly from one political party to another – changes to tax law often follow. Having sound professional guidance can help taxpayers keep up with these changes, use them to their benefit when possible and avoid unnecessary issues with federal and state tax authorities.