It’s never been easy to navigate the ever-shifting tax rules around charitable giving, and now it’s even trickier. Major changes under the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, are creating complexity, opportunity, and, for some, urgency. The OBBBA reshapes both how much you can deduct for charitable contributions and who can benefit from these deductions in the first place.
Whether you are working with clients as a professional advisor, or planning your own year-end giving, these rules are worth understanding. At the Community Foundation, we often serve as a sounding board when charitable giving comes up. We have tools that can help, and if we can’t help directly, we’ll point you in the right direction.
Here are three key changes to keep in mind as 2025 winds down:
- Consider “bunching” charitable contributions in 2025
The OBBBA expands the standard deduction to $15,750 for single filers and $31,500 for married couples in 2025, with even higher levels for taxpayers aged 65 and older. This will make it harder for many households to itemize deductions. A strategy known as “bunching” charitable donations can help. For example, instead of giving $12,000 each year, a donor could contribute $36,000 (three years’ worth of gifts) to a donor-advised fund in 2025. This pushes total deductions high enough to itemize for one year, while future gifts can be distributed to charities from the fund while taking the standard deduction. - Look ahead to 2026
Beginning in 2026, only charitable donations exceeding 0.5% of adjusted gross income will be deductible. That means a couple with $225,000 in AGI would see their deductible charitable amount reduced by $1,125 annually. In addition, the maximum tax benefit from charitable deductions for high-income taxpayers will be calculated at a 35% rate instead of 37%. For many households, 2025 will be a pivotal year to consider accelerating charitable gifts using bunching strategies to maximize current tax strategies before these tighter rules take effect. - Watch for the new deduction for non-itemizers
Also starting in 2026, taxpayers who take the standard deduction will be able to claim up to $1,000 (single filers) or $2,000 (married filing jointly) in direct charitable deductions. This is good news for the roughly 100 million Americans who don’t itemize. But note the fine print: this deduction only applies to cash gifts made directly to charities—it excludes gifts of stock or contributions to donor-advised funds, which are tax-effective and convenient charitable giving vehicles.
2025 is shaping up to be a pivotal year for charitable giving decisions. Nonprofits across our community are in urgent need of donor support, and beyond the tax implications, philanthropy addresses critical local needs that transcend any deduction. Whether you’re advising clients or planning your own giving, now is the time to consider how to maximize both the tax benefits and the community impact of your charitable contributions.
Pragya Murphy serves as director of development & impact investing at the Central New York Community Foundation, where she leads charitable planning for individuals, families and companies and provides outreach to the local professional advisor community and nonprofit organizations. Pragya also supports the Community Foundation’s impact investment program and is available to nonprofits interested in learning more about or applying for impact investments.
