Two questions
Most charitable planning is one of two things. The first is efficiency: given that you intend to give, how do you do it so the tax benefit is largest and the cost to your estate smallest? The second is structure: how do you build giving that recurs, funds a family legacy, or provides you income while ultimately benefiting charity? The tax deduction rules govern the first; the vehicles — gift annuities, charitable trusts, donor-advised funds, foundations — govern the second.
The deduction rules in 2026
The 2025 law (Public Law 119-21) changed the charitable deduction in ways that first bite in 2026, and they cut in both directions:
- A new 0.5%-of-AGI floor for itemizers. Only charitable giving above one-half of one percent of your adjusted gross income is deductible. On a $400,000 AGI, the first $2,000 of giving no longer produces a deduction.
- A new deduction for non-itemizers. Those who take the standard deduction may now deduct cash gifts above the line — up to $1,000 (single) or $2,000 (married filing jointly) — but only to public charities, not to donor-advised funds.
- A 35% cap on the benefit for top-bracket donors. For taxpayers in the 37% bracket, the tax value of itemized deductions, including charitable gifts, is limited to 35 cents on the dollar.
- The 60%-of-AGI cash ceiling is now permanent (below).
The AGI ceilings on what you can deduct in one year
Even above the new floor, the amount deductible in a single year is capped as a percentage of AGI, and the percentage depends on what you give and to whom. Excess above the ceiling generally carries forward for up to five years (IRC § 170(b), (d)).
| Gift | Recipient | AGI ceiling |
|---|---|---|
| Cash | Public charity / DAF | 60% |
| Long-term appreciated property | Public charity / DAF | 30% |
| Cash | Private foundation | 30% |
| Long-term appreciated property | Private foundation | 20% |
Source: IRC § 170(b); five-year carryforward under § 170(d). The 60% cash ceiling was made permanent, and the 0.5%-of-AGI floor and non-itemizer deduction added, by Public Law 119-21 (2025), effective 2026. Figures re-verified against the statute.
Vehicles that pay you back
Several structures let you give and still receive something — income, or a required distribution satisfied:
- A qualified charitable distribution sends money straight from an IRA to charity, tax-free, and counts toward your RMD (up to $111,000 for 2026).
- A charitable gift annuity pays you fixed income for life in exchange for a gift, with a partial deduction now.
- A charitable remainder trust pays you (or family) an income stream, with the remainder going to charity.
Structured, ongoing giving
For giving that continues across years or generations, the two main vehicles are the donor-advised fund and the private foundation, and they trade simplicity against control. A donor-advised fund is inexpensive, private, and immediate; a private foundation offers control and legacy but carries a 5% payout requirement, an excise tax, and real administration. A charitable lead trust, the mirror image of the remainder trust, can pass assets to heirs at a reduced transfer-tax cost while funding charity first (see CRTs and CLTs).
Which vehicle fits depends on the size and type of the gift, your income, and your goals — and, in 2026, on the new deduction mechanics. If you want a professional to model the options against your own tax picture, our directory of estate-planning professionals lists people you can verify yourself.
Common questions
Did the rules for deducting donations change for 2026?
Yes. The 2025 law (Public Law 119-21) added two things starting in 2026. Itemizers now face a 0.5%-of-AGI floor: only charitable giving above one-half of one percent of your adjusted gross income is deductible. And people who take the standard deduction get a new above-the-line deduction for cash gifts — up to $1,000 (single) or $2,000 (married filing jointly) to public charities, though not to donor-advised funds. The 60%-of-AGI ceiling on cash gifts to public charities was also made permanent.
What's the most tax-efficient way to give if I'm over 70½?
For many people it's a qualified charitable distribution (QCD) straight from an IRA. It's excluded from income entirely — better than taking a taxable withdrawal and then deducting the gift — and it counts toward your required minimum distribution. For 2026 you can give up to $111,000 this way. See the QCD page for the details and traps.
Should I give appreciated stock or cash?
Giving long-term appreciated stock directly to a public charity is often more efficient than giving cash: you generally deduct the full fair market value and neither you nor the charity pays capital-gains tax on the appreciation. The trade-off is a lower AGI ceiling — 30% for appreciated property versus 60% for cash — with any excess carried forward for up to five years (IRC § 170(b), (d)).
Sources & methodology
Methodology & sources
Primary sources are cited in place: IRC § 170 (the charitable deduction, its AGI ceilings at § 170(b), and the carryforward at § 170(d)), linked to Cornell’s Legal Information Institute; and Public Law 119-21 (2025), which added the 0.5%-of-AGI floor and the non-itemizer deduction and made the 60% cash ceiling permanent, effective 2026. The QCD, gift-annuity, and trust figures are cited on their respective pages. Re-verified on each change in law — see our editorial standards.
This page is educational and is not legal or tax advice. Charitable structures interact with your income, your assets, and the 2026 rule changes; use this framework and confirm the specifics with a qualified professional.
Last verified July 20, 2026.