Good News for Non-Itemizers
Currently, taxpayers who take the standard deduction (i.e., don’t itemize) generally cannot deduct charitable contributions. That will change in 2026.
Beginning in 2026, non-itemizers will be allowed to deduct cash donations to charity up to:
- $1,000 per year for single filers, or
- $2,000 per year for married couples filing jointly.
New Limits for Itemizers and High-Income Donors
If you itemize your deductions and make substantial charitable donations, take note: starting in 2026, your ability to deduct those donations will be reduced.
In 2026, you may deduct charitable contributions to the extent they exceed 0.5 percent of your adjusted gross income (AGI). Here’s how this new floor works:
Example. If your AGI in 2026 is $200,000 and you donate $10,000 to charity, only the amount over $1,000 (0.5 percent of AGI) is deductible. Your allowed deduction is $9,000.
You cannot carry forward the disallowed $1,000 unless your total charitable contributions for the year exceed one of the limits, such as 60 percent or more of your AGI for cash donations.
Changes for C Corporations
- Charitable contributions are deductible to the extent they exceed 1 percent of a corporation’s taxable income; and
- The disallowed portion can be carried forward for up to five years if the total donations for the year exceed 10 percent of the corporation’s taxable income.
Planning Opportunities before the Rules Change
- If you itemize, consider accelerating your charitable giving before year-end.
- You might double your planned donations in 2025 and scale back in 2026.
Bunching Donations Going Forward
- Combine multiple years of charitable giving into one year to exceed the new deduction thresholds.
- For example, you could donate two years’ worth of contributions in 2026 (and itemize), then take the standard deduction in 2027 while making little or no donations that year.
How We Can Help
Sterling Tax and Accounting is here to help your business with tax planning! Our comprehensive approach to tax planning helps reduce your overall tax liability and keep more money in your pocket. If all your accountant does is file your taxes, chances are they are making you pay more than your fair share of taxes.
Learn how to proactively save on taxes by scheduling a call with our tax planning specialists.
Our tax planning, accounting & business services help you stay on track. Sterling Tax & Accounting will work with you to optimize your business and minimize your taxes. We will work to provide you and your business with the tools and resources you need to build a solid tax and business foundation. We’re a trusted CPA Firm in Sarasota, Florida. We serve clients all over the US, and proactively work to minimize their taxes.
Welcome to the Sterling Standard of business! Want to learn more? Schedule a meeting with our tax planning team here: https://www.sterling.cpa/contact-us/