Nonprofit Investment Management Blog

Three Tax Changes Your Year-End Donors Should Know

Written by Megan Lencoski | Nov 12, 2026, 2:00:00 PM

For the first time, the charitable deduction rules from the One Big Beautiful Bill are fully in effect. Some of your donors now have a tax benefit they didn't have a year ago. Others, mostly your larger donors, are working with new limits.

Many of your donors may not be aware of these changes. That's not a knock on donors. Tax law isn't exactly beach reading.

You don't need to become a tax expert to help your donors take full advantage of all their tax saving opportunities. You just need to know what changed and point donors to their advisors.

Here three of the changes to know before December 31:

  • A new deduction for donors who don't itemize
  • A new floor for donors who do itemize
  • A cap on the benefit for donors in the top tax bracket

How the New Charitable Deduction Rules Affect Your Donors This Year

1. Donors Who Don't Itemize may be Able to Deduct Cash Gifts Again

Donors who take the standard deduction can now often deduct up to $1,000 (single filers) in cash gifts to qualified charities, or $2,000 for married couples filing jointly. That covers many of your donors, since the IRS reports that about 88% of filers take the standard deduction.

The fine print matters. Only cash gifts count (check, card, or online). Gifts of stock or gifts to donor-advised funds generally don't qualify.

Now, most donors don’t give for the tax write-off. They give because they believe in your mission.

But knowing a gift is deductible may nudge some of them to give a little more, and it’s useful information they deserve to have if they’re already supporting your work.

Now imagine that across your donor base. A slightly larger gift from many supporters could add up to a meaningful difference for your mission.

For the full breakdown, including how to talk about it, read The Above-the-Line Charitable Deduction for Non-Itemizers: What Your Nonprofit Should Tell Donors.

2. Donors Who Itemize Have a New Floor

For donors who itemize, charitable gifts are now deductible only above 0.5% of their adjusted gross income. A donor with $200,000 of AGI, for example, can't deduct the first $1,000 they give.

For most donors, that's a small change. For major donors who give the same amount every year, it may be worth a conversation with their advisor about timing.

3. Top-bracket Donors Have a Cap on the Benefit

Starting in 2026, taxpayers in the highest federal income tax bracket will see a slight reduction in the tax benefit they receive from charitable giving. Under the new rule, charitable deductions for these high earners will be capped at 35%, even though their top marginal tax rate is currently 37%.

In practical terms, that means each dollar donated will reduce taxes by 35 cents, not 37 cents.

What Didn’t Change: Year-End Giving Strategies That Still Work

Some of the most useful year-end tools still work the way they did:

  • Gifts of appreciated stock can still let itemizing donors deduct the full market value while avoiding capital gains tax.
  • Qualified charitable distributions still let donors 70½ and older give directly from an IRA. Because a QCD is excluded from income rather than deducted, the new floor and cap don't apply to it.

What to Tell Donors Before December 31

Keep it short, keep it accurate, and always point back to the donor's tax advisor. Your job is awareness, not advice. Here's language you can copy and adapt.

For Year-end Emails

Did you know? If you take the standard deduction, cash gifts made by December 31 may be deductible on this year's tax return. We encourage you to check with your tax advisor to see how this applies to you.

For a P.S. in Your Appeal Letter

P.S. New tax rules may let you deduct your gift even if you don't itemize. Gifts must be made by December 31 to count for this year.

For Your Donate Page

Giving before December 31? Your gift may be tax-deductible, even if you take the standard deduction. Consult your tax advisor for details.

Your Year-End Checklist

A few small updates now can save your team a lot of December scrambling:

  • Add one line about the non-itemizer deduction to your year-end emails and appeal letter
  • Update your donate page with your December 31 cutoff and mailing address
  • Brief your development staff on the new rules
  • Make sure gift receipts go out promptly and include the gift date and amount
  • Plan your Giving Tuesday follow-up to include a short tax reminder

Take Advantage of These Tax Changes in Your Year-End Campaign

Most of your donors don't give for the tax break. But this year, many of them have one they didn't have before, and some of your biggest supporters have new reasons to plan ahead. A clear sentence in the right place helps both groups give with confidence.

For templates, sample language, and more planning tools, visit our Year-End Giving Resource Library. For a deeper look at the broader law changes, watch our on-demand webinar, Year-End Giving Under the One Big Beautiful Bill.