New 0.5% Floor for the Deduction on Charitable Contributions
Starting with the 2026 tax year there is a new limitation on the charitable contribution deduction for individuals that itemize their deductions. Individuals will now have to reduce their charitable deduction; which is still subject to the other percentage limitations that apply to charitable deductions, by 0.5% of the individual’s contribution base (generally this will be Adjusted Gross Income (AGI)) for the year.
In certain circumstances this 0.5% reduction in charitable contributions may be carried forward to future years.
In certain circumstances this 0.5% reduction in charitable contributions may be carried forward to future years.