Video Tips: Changes Coming to Charitable Contributions in 2026

Beginning in 2026, the Omnibus Budget Reconciliation Act of 2021 (OBBBA) introduces significant changes to the rules governing charitable contributions. One prominent adjustment is the implementation of a 0.5% of Adjusted Gross Income (AGI) contribution floor for taxpayers who elect to itemize their deductions. This means that itemizing taxpayers will only be able to deduct charitable contributions that exceed 0.5% of their AGI, potentially limiting the tax benefit of smaller charitable donations. Additionally, for taxpayers who do not itemize, the OBBBA provides a deduction specifically for cash contributions, allowing a deduction of up to $1,000 for single filers and $2,000 for joint filers.