By Tanner Manning, AFC®
For many years, charitable giving has been a way for people to make a difference in their community while also receiving a tax deduction. However, changes to tax law in recent years have shifted how valuable those deductions can be for many households.
When the Tax Cuts and Jobs Act (TCJA) was passed in 2017, the standard deduction nearly doubled. While that change simplified taxes for many, it also meant that fewer people itemized their deductions. As a result, charitable giving became less favorable from a tax perspective because donations often did not provide any additional tax benefit unless someone’s total itemized deductions exceeded the higher standard deduction.
In response, temporary provisions were introduced during the pandemic that allowed taxpayers to deduct up to $300 (single) or $600 (married) in charitable contributions even if they didn’t itemize.
That special rule expired, but starting in 2026, taxpayers will again see a benefit for charitable giving at a higher level; up to $1,000 for single filers and $2,000 for married couples filing jointly.
This adjustment restores some incentive for individuals and families who want to support nonprofits, churches, and community organizations but haven’t itemized in recent years. While the primary motivation for giving is rarely the tax deduction, it’s encouraging to know that the tax code is once again recognizing the importance of generosity.
If you’re considering ways to maximize your giving strategy, you may also be interested in advanced approaches such as donating appreciated assets or Qualified Charitable Distributions (QCDs) from retirement accounts. We recently covered QCDs in more detail here.
Making Charitable Giving Easier: Understanding Qualified Charitable Distributions (QCDs)
At Searcy Financial®, we believe giving back is a core part of building a meaningful financial plan. We’d be happy to help you explore the best ways to align your charitable goals with your overall financial picture.