Charitable Giving - an Advantage We Never Saw Coming from the One Big Beautiful Bill Act

Good news is on the horizon for big-hearted people like yourself. The One Big Beautiful Bill Act, signed into law on July 4, 2025, is a significant piece of legislation that covers tax and spending policies over a wide range of areas of government, including tax cuts, border security, Medicare, and economic impact. 

Though the act is controversial, there is definitely a silver lining. Anyone who donates cash to charity can now claim a tax deduction, even if they do not itemize their taxes. Until now, only people who itemized, about 1 in 10 taxpayers in the U.S, usually higher earners, could write off their giving. 

The Standard Deduction

The Change 

Individuals can deduct up to $1,000, and married couples up to $2,000, for cash donations without needing to itemize.  

How Donors Can Take Advantage 

If you usually take the standard deduction, starting in January 2026, even small cash donations can lower your taxes. Consider giving a little more throughout the year; your generosity now has tangible tax benefits. 

What Changes for Itemizers Under the New Law? 

The Change 

For those who itemize, deductions won’t start until giving reaches 0.5% of income, and the overall tax break is capped at 35% (down from 37%). 

How Donors Can Take Advantage 

If you’re a larger donor, think about strategies like “bunching” (making bigger gifts in one year and smaller gifts the next) to maximize your tax benefit. Talk to your financial advisor about timing your gifts. 

 

How Does the New Tax Law Affect Corporate Giving? 

The Change 

Companies can only deduct gifts above 1% of their income, which may reduce corporate giving in the long run. 

How Donors Can Take Advantage 

Business owners should plan to meet the new 1% minimum, so their giving still qualifies for a deduction. Strategic timing and tracking your charitable contributions are key. 

Legacy Giving Just Became More Attractive 

The Change 

The estate tax exemption, previously set to shrink in 2025, is now permanently doubled to $15M per person (or $30M per couple). 

What This Means 

While this only affects the wealthiest families, retirement assets and bequests remain powerful, tax-efficient ways to support a charitable cause. 

How Donors Can Take Advantage 

Keep legacy giving in the mix! Talk with planned giving prospects about wills, retirement gifts, and charitable trusts. Even if you’re not among the ultra-wealthy, understanding these options can help maximize your impact for the causes you care about. 

Why This Tax Change Matters for Everyday Americans

Experts say this change “democratizes” giving. It makes the tax code friendlier to small and first-time donors, not just the wealthy. 

This law is a win for ordinary people who want to give back. For the first time in years, you do not have to be wealthy or itemize your taxes to get rewarded for your generosity. 

As one expert put it: “The bill gives, and the bill takes away.” But for millions of everyday Americans, it just made giving to charity a little easier.