The Steady Saguaro: Giving is Changing, Vol. 4

Giving is Changing | Volume 4

Hello, friends! The calendar has finally flipped, and once again, we’re looking at a brand new year full of opportunities (and challenges) for our allies in the nonprofit sector, and the incredible donors that ensure this backbone of Southern Arizona gets what it needs to continue providing for the essential needs of our community.

With that, here’s another look at some key things to keep in mind, reflecting the changes related to federal charitable deductions for the coming year. I don’t know too many Southern Arizonans (other than you, my CPA friends!) who want to spend this gorgeous time of year thinking about taxes, but as a dedicated community member, I am asking you to start thinking early about your charitable giving. Nonprofits serve our community year-round, and they need your support all year long, and this year, there are a lot of changes.

Giving in 2026

Although I am sharing vital and detailed information in this edition of The Steady Saguaro, my overall advice is simple: Consult your tax advisor and plan your giving early!

Impacts on Everyone:

Anyone taking a standard deduction can deduct an additional amount for charitable gifts, up to $1,000 for individuals and $2,000 for a married couple filing jointly – even if they don’t itemize.

The current 60% of adjusted gross income (AGI) cap on deductions for cash gifts to public charities is now permanent. That’s good news, and you can work with your tax advisor to explore how cash gifts and alternatives can provide tax and planning benefits that are aligned with your goals and circumstances. CFSA offers you many ways to give, including appreciated stock, qualified charitable distributions from IRAs, and gifts of real property.

Impacts on 65+ Donors:

If you are 65 or older, you can take a new $6,000 deduction in tax years 2025–2028. If your circumstances allow, consider allocating some of those additional funds to meet your charitable goals.

Impacts on 70-1/2+ Donors:

Qualified charitable distributions, or Individual Retirement Accounts (IRA) rollovers, as they are commonly referred to, will be even more tax efficient for donors over 70-1/2 going forward. For example, for those who itemize their deductions in 2026, QCDs can avoid the impact of the new floor created in the law.

Impacts on Donors Who Itemize:

The new law creates a ‘floor’ for giving that must be achieved before deductions can be taken in 2026. Instead of counting from the first dollar donated, now you must donate more than .5% of your AGI before charitable contributions are deductible. Ex. A couple filing jointly whose adjusted gross income is around $150,000: only the excess over $750 (.5% of AGI) will be deductible in 2026.

There is now a cap on the value of the charitable contribution deduction, which limits that value to a 35% tax benefit, even if your tax bracket is higher. This change for 2026 means community members in the highest tax bracket will no longer get a dollar-for-dollar deduction from contributions.