Charitable contributions continue to play an important role in tax planning. For the 2026 tax year, understanding how qualified contributions interact with taxable income and tax credits is essential for maximizing tax savings while remaining compliant with the Internal Revenue Service’s current laws.
Join our Raleigh-Durham area tax consultants from Steward Ingram & Cooper, PLLC as we explore how charitable gifts and other deductible contributions work and what limits apply.
Whether you are looking for answers regarding charitable limits for business entities, nonprofit organizations, or an individual’s contribution base, our tax advisors are sharing what to consider for charitable giving in 2026.
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Charitable Contribution Limit Updates for 2026
Under the One Big Beautiful Bill Act, adjustments to how taxpayers deduct charitable contributions will effect taxpayers in 2026.
Taxpayers who itemize deductions will only be able to claim a charitable contribution deduction for the portion of their total charitable giving that exceeds 0.5% of their adjusted gross income (AGI). This means the first 0.5% of charitable contributions in a year doesn’t count toward the deduction.
Above-the-Line Deduction for Cash Contributions
In 2026, taxpayers who do not itemize deductions can still claim a limited charitable deduction for cash contributions made to qualified charitable organizations. Single filers can deduct up to $1,000, and married joint filers can deduct up to $2,000—even if they take the standard deduction.
However, this deduction generally applies only to cash contributions to qualified public charities and excludes gifts to donor advised funds and private non-operating foundations.
Percentage Limits Based on Type of Donation
The longstanding rules tying charitable contribution deductions to a percentage of the taxpayer’s taxable income continue in 2026:
- Cash contributions to qualified public charities may still be deductible up to 60% of AGI for itemizers
- Other categories (like capital gain property) retain their own percentage limits based on the type of donation.
- Amounts that exceed these limits may often be carried forward for up to five years.
Reduced Benefit for High-Income Itemizers
Taxpayers in the top tax bracket will see the value of their charitable deduction capped at 35¢ per dollar donated, rather than the previous 37¢ rate. This does not change the amount you can deduct—it affects the tax break you receive for that deduction.
Qualified Charitable Distribution (QCD) Considerations
Qualified charitable distributions from IRAs remain valuable planning tools and are not generally affected by the 0.5% AGI floor. The maximum amount that can be excluded via a QCD typically increases annually for inflation, though this is separate from charitable contribution deduction rules and applies to taxpayers age 70½ or older.
Why These 2026 Changes Matter
- Smaller donations may no longer generate a charitable contribution deduction unless they exceed the 0.5% AGI floor.
- Non-itemizers now have a tax incentive (above-the-line deduction) to make cash contributions directly to qualified charities.
- Strategic planning—such as “bunching” charitable contributions or using donor advised funds—may become more valuable to ensure contributions exceed the new thresholds and maximize tax benefit.
Cash vs. Property Charitable Contribution Tax Deduction
Different rules apply depending on whether charitable contributions are made in cash or through donated property.
Cash Contributions
Cash contributions include cash gifts, checks, credit card payments, and certain electronic transfers made to a qualified organization.
For 2026:
- Cash donations to private foundations are typically limited to 30% of AGI
- Cash contributions to public charities may generally be deducted up to 60% of the taxpayer’s adjusted gross income
Cash gifts remain one of the most straightforward ways to deduct charitable contributions, provided proper documentation is maintained.
Property Contributions and Capital Gain Property
Property contributions, including stocks, real estate, and tangible personal property, follow different deduction rules:
- Donations of capital gain property to public charities are generally deductible at fair market value
- Capital gains tax may be avoided when appreciated assets are donated instead of sold
- Donations to private foundations may be subject to lower deduction limits
Fair market value must be properly substantiated, especially for higher-value non cash gifts.
Charitable Contribution Limits for Standard vs. Itemized Deductions
Charitable contribution deductions are claimed as part of itemized deductions. Taxpayers who take the standard deduction vs itemized deduction cannot deduct charitable contributions unless a limited above the line deduction applies.
For many taxpayers, the increased standard deduction means itemizing only makes sense when charitable deductions, state and local taxes, mortgage interest, and other expenses exceed the standard deduction threshold.
This is why charitable giving strategies often focus on timing and aggregation.
Bunching Charitable Contributions
Bunching involves making multiple years’ worth of charitable contributions in a single tax year to exceed the standard deduction and claim itemized deductions. Excess contributions can then be carried forward up to five years.
Public Charities vs Private Foundation Contribution Limits
Public charities typically offer higher deduction limits than private foundations. Contributions to private foundations are subject to lower percentage limitations and additional compliance rules.
Other qualifying organizations may include:
- Veterans organizations
- Fraternal societies
- International amateur sports competition organizations
- Qualified conservation contribution entities
It is important to confirm that the recipient is a qualified organization under Internal Revenue codes and compliance guidelines.
Documentation Requirements to Determine a Taxpayer’s Contribution Base
Proper documentation is essential to deduct charitable contributions and accurately reduce your tax liability.
Taxpayers must:
- Keep receipts for deductions
- Obtain written acknowledgments for contributions of $250 or more
- Secure qualified appraisals for certain property contributions
- Retain records supporting fair market value determinations
Failure to meet documentation requirements may result in disallowed charitable deductions on a tax return.
Charitable Contribution Limit FAQs
Is there a limit to how much money you can donate to charity?
There is no limit on how much you can donate, but there are limits on how much you can deduct in a given tax year based on your adjusted gross income and the type of charitable organization.
Is there a limit on charitable donations for 2025 or 2026?
Yes. Charitable contribution limits continue to apply, generally ranging from 30% to 60% of AGI depending on the type of contribution and recipient organization.
Which donations are eligible for a 100% deduction?
In limited circumstances and specific tax years, temporary provisions have allowed higher deductions. For 2026, most charitable contribution deductions remain subject to percentage limits.
Is donating to charity a 100% tax write-off?
No. While charitable giving provides a tax benefit, deductions are limited by AGI thresholds, organization type, and whether itemized deductions are claimed.
Schedule an Appointment with a Raleigh-Area CPA Today
Effective charitable giving requires coordination with broader tax planning goals. Timing, contribution type, and documentation all impact the final tax benefit.
If you are a North Carolina business owner or an individual with complex financials needing assistance filing your taxes, Steward Ingram & Cooper’s small business accountants may be able to help. We take on a limited number of clients in Raleigh, Durham, Morrisville, and the surrounding communities, each year.
To inquire about our current availability and timeline, please fill out the contact form or give us a call at (919) 872-0866 today.