It’s tax season, which means it’s a terrific time to ensure that your charitable giving goals are on track. Even if a professional prepares your income tax return, it’s useful to quickly review a few basic rules to pave the way for the conversation about charitable planning, especially in light of key tax law changes that became effective on January 1, 2026. Here are four items to discuss with your CPA:
New rules for itemizing charitable deductions
As in prior years, charitable contributions are deductible only if you itemize your deductions. If your total itemized deductions do not exceed the standard deduction, your charitable gifts will not generate an additional tax benefit (with one exception discussed below).
What’s new for 2026 is a threshold for itemizers: charitable deductions are allowed only to the extent they exceed 0.5% of your adjusted gross income. In practical terms, this functions like a deductible. If your AGI is $200,000, for example, the first $1,000 of charitable contributions will not be deductible. Only amounts above that level are eligible, subject to existing percentage-of-income limits. For some people, this change may make it more appealing to “bundle” or “bunch” contributions into a single year — such as through a Donor Advised Fund — so that total giving comfortably exceeds both the standard deduction and the new AGI floor.
In addition, beginning in 2026, the value of itemized charitable deductions is capped at a 35% rate. So, even if you are in the 37% federal bracket, your charitable deduction will not offset income at your full marginal rate. While philanthropy is rarely motivated solely by taxes, this adjustment may influence the timing, structure, or asset selection for major gifts. Coordinating early with both your tax advisors and the community foundation team can help you evaluate the most efficient approach.
Finally, in a bit of good news, the long-standing rule allowing cash gifts to qualified public charities (such as your charitable fund at the Sacramento Region Community Foundation) to be deducted up to 60% of AGI has been made permanent (after clearing the new 0.5% AGI floor). Gifts of appreciated assets—such as stock or real estate—are generally deductible up to 30% of AGI.
New deduction for non-itemizers
Beginning in 2026, even if you do not itemize deductions on your tax return, you may claim an above-the-line charitable deduction of up to $1,000 for single filers or up to $2,000 for married couples filing jointly, for cash gifts to qualifying charities.
Because this deduction reduces income before AGI is calculated, it can provide a meaningful benefit. It does not apply to non-cash gifts, and certain types of funds, such as Donor Advised Funds, are not eligible for this particular deduction. Even so, this new rule creates planning opportunities for many households who previously saw no tax impact from their annual giving. Keep this in mind for young adult children who do not yet itemize and who would like to start getting involved in charitable giving.
Document your charitable deductions
Not surprisingly, documentation rules remain in place. Gifts over $250 require a written acknowledgment from the nonprofit. (In the Sacramento Region Community Foundation’s case, we provide this for gifts made into the charitable funds we house.) Non-cash gifts valued at $500 or more require IRS Form 8283, and qualified appraisals are required for donations over $5,000, such as closely held stock or real estate.
If you organize your giving through a Donor Advised Fund with us, you might consider structuring your annual giving so that you receive a single tax receipt for your annual contribution of cash, stock, or other assets to the fund. Your CPA won’t need separate receipts for each grant the fund distributes to your favorite charities. Many donors find this consolidated recordkeeping especially helpful at tax time!
If you are age 70½ or older, consider gifts from your IRAs
Qualified Charitable Distributions may be even more valuable under the new tax rules. If you are age 70½ or older, you can use a QCD to direct funds from your IRA to certain types of charitable funds that we house. The 2026 annual limit is $111,000 per taxpayer, allowing you to transfer significant amounts to charity without including the distribution in taxable income. QCDs can also satisfy required minimum distributions if you’ve reached the age where those apply.
Importantly, QCDs are not affected by the new itemized deduction floor or deduction caps, making them an especially efficient strategy for many retirees. As a reminder, QCDs cannot be directed to Donor Advised Funds, but they can support Designated Funds, Field of Interest Funds, Scholarship Funds, and Nonprofit Funds.
The charitable tax rules have always required thoughtful planning. In 2026, that planning is simply more nuanced. We encourage you to forward this summary to your CPA or bring it to your next meeting. When you do, please keep us in the loop!
Your Philanthropy Team
We’re here to help you give with confidence.
