Year-End Giving 2026: New Charitable Deduction Rules Every Nonprofit and Church Should Know
Year-end giving season is almost here, and for many nonprofits and churches, November and December bring in a large share of the year's donations. This year the season comes with new rules. The One Big Beautiful Bill Act changed how charitable gifts are deducted starting with the 2026 tax year, and as tax writer Kelly Phillips Erb explained in a Taxgirl article on October 14, several of those changes take effect for gifts made right now. Here is what changed, who it affects, and how nonprofit leaders can help donors give with confidence.
What changed for 2026
There are three big changes for individual donors:
A new deduction for non-itemizers. Donors who take the standard deduction can now deduct up to $1,000 of cash gifts to qualifying charities, or $2,000 for married couples filing jointly. It is a deduction, not a credit, so its value depends on the donor's tax bracket.
A new floor for itemizers. Donors who itemize can only deduct charitable gifts to the extent their total giving exceeds 0.5% of their adjusted gross income. For a household with $100,000 of AGI, the first $500 of gifts for the year produces no deduction.
A cap on the value for top earners. For taxpayers in the 37% bracket, itemized deductions, including charitable gifts, are effectively worth no more than 35 cents per dollar.
The usual percentage-of-income limits still apply, and the new rules cover gifts made in 2026, which donors will report on returns filed in 2027.
Who this affects
The new non-itemizer deduction is good news for everyday donors. Most households take the standard deduction, which meant their gifts had no federal tax benefit at all. Starting this year, a family that gives $2,000 in cash to your organization may be able to deduct it even without itemizing.
There are important limits. The non-itemizer deduction only covers cash gifts, which includes checks, card payments, and electronic transfers, made to eligible public charities. Gifts of clothing, household goods, or appreciated stock do not count, and neither do gifts to donor-advised funds or certain private foundations.
Larger donors who itemize will feel the new 0.5% floor, and high-income donors will feel the 35% limit. Many advisors expect these donors to rely more on strategies such as giving appreciated stock, making qualified charitable distributions from IRAs, and grouping several years of gifts into one year.
Practical steps for nonprofits and churches
We suggest a few practical steps for your year-end campaign:
Update your donor messaging. A simple line such as "New this year: many donors who don't itemize can deduct cash gifts" can encourage first-time and smaller donors. Avoid promising a specific tax result, since every donor's situation is different.
Get your acknowledgments right. Donors need a written acknowledgment for any single gift of $250 or more, stating the amount and whether any goods or services were provided in return. Clean, timely receipts matter even more now that more donors may claim a deduction.
Make it easy to give cash electronically before December 31. Check that your online giving page, text-to-give, and payment processing are working well ahead of the year-end rush.
Welcome qualified charitable distributions. Donors age 70½ or older can send gifts directly from their IRAs, which may help them even if they don't itemize. Make sure your team knows how to recognize and acknowledge these gifts.
Be ready for stock gifts. If you accept appreciated securities, confirm your brokerage account details now so you are not scrambling in late December.
Keep your board and finance team informed. If giving patterns shift, such as more small cash gifts or larger gifts bunched into one year, your budget and cash-flow forecasts may need adjusting.
Helping your donors plan
Your donors will have questions, and you do not need to be a tax expert to help. The most useful thing you can do is share clear, accurate information and encourage donors to talk with their own tax advisors about the best way to give. A thoughtful year-end letter, a short FAQ on your website, and a well-trained front-office team go a long way.
If your organization would like help reviewing your gift acknowledgment process, preparing for year-end, or understanding how these changes affect your budget, the team at Count The Cost Accounting would be glad to help. Reach out to us anytime.
This post is general information, not individual tax advice. Please talk with a qualified tax professional about your specific situation.
Comments