The "One Big Beautiful Bill" Rewards Charitable Donations for Most Donors, With a Few Twists
On July 4, 2025, Congress passed the One Big Beautiful Bill (OBBBA) — a major update to U.S. tax laws that directly affects charitable giving. These changes mean that, starting in 2026, more people will receive tax benefits for giving, while larger donors and businesses will see new rules that shape how and when they give.
Here’s what you need to know:
Good News for Everyday Donors
For the first time, even if you don’t itemize deductions on your taxes, you can claim a charitable deduction:
- Up to $1,000 for individuals
- Up to $2,000 for married couples filing jointly
That means every gift makes an even bigger impact — for families in need and for your own finances.
For Major Donors
If you give larger amounts and itemize deductions, the rules are shifting slightly. You may want to plan the timing and size of your gifts more carefully to maximize tax benefits. Strategies like bunching gifts or making multi-year commitments may help you give most effectively.
Legacy Giving Gets a Boost
Estate tax exemptions are now permanently doubled — up to $15 million per person. That makes leaving a charitable gift through your will, trust, or retirement plan even more rewarding.
Corporate Giving
Businesses will need to give at least 1% of taxable income before receiving tax benefits for charitable contributions. This could open the door to stronger partnerships between nonprofits and companies committed to making a difference.
State Scholarship Credits
Starting in 2027, donors in states that opt in may be eligible for up to a $1,700 credit for gifts to approved K-12 scholarship funds.
What This Means for You
- Everyday donors: You’ll now see tax savings for giving, even if you take the standard deduction.
- Major donors: Smart planning will help you maximize your generosity and your tax benefits.
- Families and businesses: Legacy and corporate gifts are more powerful than ever.
The Bottom Line
OBBBA makes giving more rewarding for everyone — from first-time donors to long-time supporters. Your generosity not only transforms lives but now comes with new ways to benefit you, too.
Talk with your tax professional to explore how these changes apply to you, and know that every gift you make brings hope to someone in need.