🗣️ Schedule A: What does the OBBBA change for charitable deduction?

Starting from the 2026 tax year, new opportunities and limits for charitable deductions will be introduced:

📝 Additional Deduction

If you are using the standard deduction, starting in 2026, an additional deduction for cash donations will also be available:

• Up to $1,000 — for individual filers,

• Up to $2,000 — for married filing jointly.

💳 Minimum Threshold for Itemized Deductions

Only the amount of donations exceeding 0.5% of AGI for those using itemized deductions will be deductible. Donations below this threshold will not be counted and cannot be carried forward to future years.

📍 Example

If you are itemizing deductions (Schedule A) instead of taking the standard deduction, and your AGI is $200,000, with donations totaling $1,500, only the contributions exceeding the threshold (0.5% of AGI = $1,000) will be deductible, i.e., $500.

📉 Reduction of Deductions for High-Income Taxpayers

According to the OBBBA, starting in 2026, for taxpayers whose income is taxed at the highest rate (37%), the allowable itemized deduction amount will be reduced. Instead of the usual 37% of deductions, the amount will be limited to 35% for those in the highest tax bracket.

🔎 Conclusion

Starting in 2026, charitable deductions will become less flexible for those using itemized deductions but more accessible for those opting for the standard deduction. To optimize your tax strategy, it is important to adjust to these changes now.

🔜 In upcoming posts, we will share updates on Trump Accounts and their benefits.

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