The recent passage of the “One Big Beautiful Bill” introduced several charitable tax changes for individuals and corporations, but one of the most important for the average gift planner is the introduction of a permanent charitable income tax deduction of $1,000 ($2,000 on a joint return) for taxpayers who do not itemize their deductions. This replaces the temporary $300 nonitemizer charitable deduction ($600 in a joint return) under the CARES act. The nonitemizer charitable deduction is available regardless of income level but will not be adjusted in future years for inflation. Since only about 10% of US individual taxpayers choose to itemize, this is a great opportunity for individuals to capture a charitable deduction.  

How does this affect charitable planning? This deduction is available only for cash gifts, and is not available for gifts to supporting organizations or donor advised funds, but cash contributions for charitable gift annuities would be eligible. Nonitemizing donors will find the new nonitemizer deduction helpful in cases where the donor gets an incidental personal benefit, such as a meal at a  charity event, since Qualified Charitable Distributions may not be used in cases where a portion of the contribution is not deductible because of personal benefits received.     

Another pointer:  donors who do itemize might want to consider whether charitable gifts they were planning to make in 2026 should instead be made by the end of this year. Starting next year there will be a 0.5% of adjusted gross income (AGI) floor on charitable deductions, as well as loss of a slice of the charitable deduction for taxpayers in a top income tax bracket. (The 0.5% of AGI floor on charitable deductions will not apply to the nonitemizer charitable deduction.)