What Donors Should Know About 2026 Tax Law Changes

As you consider your charitable giving plans for 2026, several federal tax law updates may affect how — and when — you choose to give. While tax considerations are rarely the sole motivation for generosity, understanding these changes can help you make informed decisions and maximize the impact of your philanthropy.

Below is a summary of the most significant updates affecting charitable giving in 2026.

1. A New Charitable Deduction for Non-Itemizers

    Beginning in 2026, taxpayers who take the standard deduction will once again be eligible for a charitable deduction.

    • Individuals may deduct up to $1,000 in cash gifts to qualified public charities.
    • Married couples filing jointly may deduct up to $2,000.

    This is significant because most Americans take the standard deduction and previously did not receive a tax benefit for charitable contributions. This change broadens access to tax incentives and may encourage giving at all income levels.

    2. A 0.5% AGI Threshold for Itemized Deductions

    For taxpayers who itemize deductions, a new rule requires that charitable contributions exceed 0.5% of your Adjusted Gross Income (AGI) before they are deductible. For example:

    • If your AGI is $200,000, the first $1,000 in charitable gifts would not be deductible.
    • Only gifts above that amount would qualify for the deduction.

    This change may encourage some donors to “bundle” or “bunch” contributions into one year in order to exceed the threshold and maximize deductibility.

    3. Estate and Gift Tax Exemptions Remain Historically High

    The federal estate and gift tax exemption remains elevated — approximately:

    • $15 million per individual
    • $30 million for married couples

    While relatively few estates are subject to federal estate tax, this exemption level provides continued flexibility for those considering:

    • Legacy gifts
    • Bequests
    • Multi-year philanthropic planning

    Donors with significant assets may wish to review their estate plans in light of these thresholds.

    Qualified Charitable Distributions (QCDs) Remain a Powerful Strategy

    For donors age 70½ and older, Qualified Charitable Distributions (QCDs) continue to be one of the most tax-efficient ways to give.A QCD allows you to transfer funds directly from a traditional IRA to a qualified charity:

    • It can satisfy Required Minimum Distributions (RMDs).
    • The distribution is excluded from taxable income.
    • It is not subject to the new 0.5% AGI threshold.

    For many retirement-age donors, this remains a highly effective way to support causes they care about while managing taxable income.

    Timing May Matter

    With several new rules taking effect in 2026, thoughtful planning can make a meaningful difference. Some donors may consider:

    • Concentrating larger gifts into one year
    • Using donor-advised funds for flexibility
    • Leveraging QCDs for retirement-based giving
    • Coordinating charitable gifts with estate planning goals

    Every situation is different, which is why consultation with a qualified tax or financial advisor is essential.

    A Thoughtful Approach to Generosity

    At Lung Cancer Initiative, we believe generosity is deeply personal. Tax policy may influence the mechanics of giving, but it never diminishes the heart behind it.

     

    If you would like to discuss how your 2026 giving can support lung cancer research, patient programs, and advocacy — while aligning with your financial plans — we are here to help. As always, we recommend speaking with your professional advisor about how these changes apply to your specific circumstances. Thank you for your continued commitment to those impacted by lung cancer.