At ACE, we are committed to helping people help animals by recommending impactful giving opportunities that reduce the most suffering with their donations. Recently, we’ve been hearing one particular, albeit understandable question from donors: “Should I give less this year, or wait to see what happens?” The One Big Beautiful Bill Act (OBBBA) has changed some of the rules around charitable tax deductions in the United States, so the uncertainty is real. Tax law is complicated and it’s natural to pause when the landscape shifts.
But here’s what you should know: for most U.S. donors, the OBBBA changes are modest and not a reason to pull back. This article takes you through what’s actually changing, what it means for your giving, and why 2026 is still an important year to support animal advocacy.
Disclaimer: ACE is not a financial advisor. Please consult a qualified tax professional for guidance specific to your unique situation.
What is the OBBBA?
Signed into law on July 4, 2025, the OBBBA is a sweeping U.S. federal tax package that made several provisions from the 2017 Tax Cuts and Jobs Act permanent, while introducing new rules for charitable giving. Most changes that affect charitable donations took effect January 1, 2026. For a full legislative summary, see the Tax Foundation’s overview.
What’s Actually Changing for Charitable Giving?
Three changes that matter most for individual donors:
New deduction for non-itemizers. Starting in 2026, if you do not itemize your deductions, you can still deduct cash donations up to $1,000 (single filers) or $2,000 (married filing jointly) to qualifying public charities. This expands and makes permanent a similar but smaller deduction that existed temporarily under the CARES Act in 2020–2021.
New 0.5% AGI floor for itemizers. Only the portion of your charitable giving that exceeds 0.5% of your adjusted gross income (AGI) is deductible. For someone with $200,000 AGI, that means the first $1,000 of your charitable giving is non-deductible.
35% cap for top-bracket donors. For taxpayers in the 37% bracket, the value of charitable deductions is now capped at 35%. That means a slightly lower $350 in tax savings per $1,000 donated, compared to $370 before.
Example: $10,000 Cash Gift
2025 (Before OBBBA)
2026 (After OBBBA)
Standard Deduction (single)
$15,750
$16,100
0.5% AGI floor
N/A
$1,000
Deductible Portion of Gift
$10,000
$9,000
Tax Value
$3,700 (at 37%)
$3,150 (at 35% cap)
Reduction in Tax Savings
—
$550 less
Bottom Line: Because the 0.5% AGI floor ($1,000 for a $200,000 AGI) is a flat amount, it affects smaller gifts more—a $5,000 gift loses 20% of its deductible value, while a $10,000 gift loses 10%. That said, the reduction in tax savings is fairly modest in both cases. Most importantly, in both cases the full gift reaches the animals.
What Type of Donor are you?
Smaller Donor ($500/year, standard deduction): No negative change here. In fact, your $500 gift may now qualify for a partial above-the-line deduction for the first time. Your charitable giving and its tax treatment are largely unaffected, or slightly improved.
Larger Donor ($20,000/year, itemizes, top bracket): Your tax savings drop from roughly $7,400 to $6,650, a difference of about $750. It’s a modest reduction on a substantial gift, but your contribution still has a meaningful impact.
How to Give Smarter Under the OBBBA
Smaller Donor ($500/year): Consider “bunching.” Combine two or three years of charitable giving into a single tax year, ideally via a Donor-Advised Fund (DAF). This can push you past the itemization threshold in one year, while you distribute gifts to charities over time.
Larger Donor ($20,000+/year): Run the numbers with a qualified financial advisor before scaling back. In most cases, the after-tax cost of continuing your current charitable giving has changed only modestly.
What This Means for Animals
Animal advocacy is chronically underfunded. Charitable giving decisions made in 2026 have real consequences for the organizations doing this important work—including ACE, our Recommended Charities, our Movement Grants recipients, and the broader effective animal advocacy movement. Even modest shifts in donor behavior add up across the movement, so we encourage everyone to be thoughtful with their giving.
Key Takeaways
Charitable giving looks different depending on your personal situation. No single approach fits everyone.
Smaller Donor: Your charitable giving is largely unaffected, and you may even gain a new modest deduction in 2026. A DAF can help you “bunch” to get the most out of itemizing.
Larger Donor: Review your numbers before scaling back. The impact is likely smaller than you think, and the full amount of your donation reaches the animals either way.
Make Your Giving Count
Ready to put your dollars to work for animals? Explore ACE’s giving options. If you have questions, feel free to reach out to our Development Team. Thanks for helping ACE help more animals!
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