Navigating Charitable Planning Opportunities Under the New Tax Law

It's more important than ever to stay informed about how changes in the tax law may affect your charitable giving. The recently passed One Big Beautiful Bill Act reshapes policy across major sectors of the U.S. economy and includes several provisions that impact philanthropy.

Amid these shifts, Akron Community Foundation is ready to help you and your advisors create a plan that achieves your charitable goals while also addressing the new tax law changes. To guide you along this journey, we've provided a checklist of issues to discuss with your advisors.

Decide if bunching is right for you

If you itemize deductions on your income tax return, 2025 presents a window of opportunity. The new law increases the 2025 standard deduction to $15,750 for single filers and $31,500 for married couples filing jointly.

Based on these increases, you may want to talk with your tax advisors about "bunching" charitable gifts for 2025 using a donor-advised fund at the community foundation. Through this technique, you can make several years' worth of charitable contributions in a single year to exceed the standard deduction threshold, thereby maximizing tax benefits in that year. In the following years, you can use your donor-advised fund to support your preferred charities at your own pace.

There are other compelling reasons to talk with your advisors about frontloading charitable contributions in 2025. Starting in 2026, a new provision will only allow donors to itemize charitable deductions if their total donations exceed 0.5% of their adjusted gross income. Furthermore, taxpayers in the top bracket can only claim a 35% tax deduction for charitable gifts instead of the full 37% that would otherwise apply to their income tax rate. Because of this imminent floor and ceiling on charitable deductions, you and your tax advisors may decide that 2025 is the year to bunch charitable contributions to maximize your tax savings.

Get familiar with next year's deduction for non-itemizers

If you do not itemize your deductions, you'll be glad to know that beginning in 2026, you can claim a deduction for cash gifts to qualifying public charities like Akron Community Foundation. The new law allows non-itemizers to take a charitable deduction of up to $1,000 for single filers and $2,000 for married couples filing jointly.

Although gifts to donor‑advised funds are excluded from this new provision, gifts to other types of funds at the community foundation — including designated and field-of-interest funds — are still eligible. This deduction could be particularly beneficial for younger donors who do not yet itemize deductions but still want to support their favorite nonprofits. If you've been encouraging your adult children to get involved in philanthropy, this is a great time to start.

Review the benefits of Qualified Charitable Distributions

A Qualified Charitable Distribution enables individuals age 70 ½ or older to donate up to $111,000 per year (as of 2026) directly from an IRA to eligible charities. In the process, the donated amount is excluded from your taxable income altogether, rather than relying on an itemized deduction. QCDs may be especially advantageous in light of the increased standard deduction because they provide a direct tax benefit regardless of whether you itemize.

In addition, using a QCD to fulfill your required minimum distribution can lower your adjusted gross income, potentially reducing taxes on Social Security income and Medicare surtaxes. It can also help you sidestep the new floors and caps on itemized charitable deductions starting in 2026.

Brush up on the basics

Despite the rule changes coming under the new tax law, many tried-and-true giving strategies still apply. For example, appreciated stock is likely to be a much more tax-savvy gift to charity than cash, as you'll receive an immediate tax deduction and avoid paying capital gains tax on the appreciation. IRAs also remain a powerful charitable planning tool. When you name a fund at the community foundation as the beneficiary of an IRA, your gift is not reduced by estate or income taxes, both of which can be a heavy burden for your heirs.

Remember that giving goes beyond tax benefits

If you regularly support charities, it's important to continue doing so, regardless of changes in the tax law. Nonprofits in our community are facing mounting pressures as federal funding cuts deepen, inflation drives up operating costs, and demand for critical services continues to climb. Your support is needed now more than ever, and Akron Community Foundation is here to help you maximize your impact on the causes you care about.

For more strategic ways to give, contact Laura Lederer, vice president and chief development officer.

This content is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice.