November 13, 2025

The giving season is not just about being generous, but it is also an opportunity to be financially savvy with your donations. This way, you not only support the causes you care about, but you can also lower your tax bill. You will hit two birds with one stone.

And you are not alone in this. As per a report, two-thirds of all charitable donations (66%) came from individuals in 2024. To encourage giving, there are tax deductions for qualified donations made to charities over the course of the tax year. Donations may be in the form of cash, in-kind, or appreciated securities.

This article covers how you can claim charitable contributions, different kinds of charitable contributions that qualify, what rules you need to follow to qualify for deductions, and how upcoming tax law changes after 2025 could affect your strategy.

What Should You Keep in Mind When Deducting Charitable Contributions

To claim a charitable contribution deduction, there are a few factors you must consider: 

  • The recipient organization must be registered as a tax-exempt organization as defined by Section 501(c)(3) of the Internal Revenue Code. Use the IRS’s Tax Exempt Organization Search Tool to check an organization’s eligibility to receive tax-deductible charitable contributions.
  • What you donate also needs to be considered. Donations of cash, property, and expenses related to volunteering are deductible, but they have specific provisions that should be kept in mind.

There are also important substantiation requirements for charitable contribution deductions. For any cash contribution you must maintain a bank record such as a canceled check, bank statement, credit card statement or a written communication from the donee organization showing the name of the organization, the date of the contribution, and the amount of the contribution. For any single cash contribution of $250 or more, you must have a contemporaneous written acknowledgement from the donee organization that includes the amount of cash contributed, and whether the organization provided any goods or services in exchange.

Non-cash contributions also have specific substantiation requirements depending on the value of the items donated. At a minimum, you must obtain a receipt from the donee organization showing the name and location of the organization, the date of donation, a description of the property donated, and a good faith estimate of the value of the items donated. As the value of non-cash items increases, there are additional substantiation requirements.

With those caveats out of the way, let’s find out what types of charitable contributions qualify for deductions

Types of Charitable Contributions That Qualify

1. Cash donations: Typically, if you itemize your deductions, cash donations are the most straightforward, with up to 60% of your adjusted gross income (AGI) deductible for contributions to qualified organizations.

2. Non-cash donations: These donations include clothing, furniture, or household items. Household items qualify:

  • They are donated at their fair market value.
  • The items are in good used condition or better.
  • If the total value exceeds $500, you must include Form 8283 with your tax return.

3. Appreciated assets: Includes stocks, mutual funds, or other investments you have held for more than a year. It is important to know that the allowable deduction for contributions of appreciated assets to qualifying organizations is limited to 30% of your adjusted gross income. Donating appreciated assets offers dual tax benefits.

  • You can avoid paying capital gains tax on the asset’s appreciated value.
  • You can deduct the asset’s full fair market value on your tax return.

Maximize the Impact of Your Generosity with Rubino

Whether you’re donating cash, appreciated assets, or planning through a donor-advised fund, we’ll
ensure your contributions are structured to deliver the greatest benefit for both your community and your bottom line.

Giving back should feel good and make financial sense. At Rubino, our experienced tax advisors help you create a charitable giving strategy that aligns with your goals while maximizing your potential deductions.

Turn your generosity into a smart financial move. Connect with a Rubino tax expert today!

4. Donor-Advised Funds (DAFs): A donor-advised fund is a charitable giving vehicle to manage charitable donations with significant tax benefits. With a DAF, you can:

  • Make a charitable contribution
  • Claim an immediate deduction
  • Recommend grants to charities over time

5. Qualified Charitable Distributions (QCDs): In 2025 anyone aged 70½ or older can donate up to $108,000 directly from their Individual Retirement Account (IRA). Note, if you are taking Required Minimum Distributions (RMDs), a QCD counts toward your RMD and it is excluded from taxable income. For years after 2025, the limit for QCDs will be indexed for inflation.

Key Changes for Donors in 2026

The One Big Beautiful Bill (OBBB) Act, enacted into law on July 4, 2025, extended several provisions in the 2017 Tax Cuts and Jobs Act that were due to sunset at the end of 2025. Starting in 2026, as per the new law, several important changes will affect how individuals and corporations claim charitable deductions:

  • Charitable deduction threshold: Beginning in 2026, only the amount of charitable contributions that exceeds .5% of your adjusted gross income is deductible. For example, if your AGI is $1,000,000, you will need to donate more than $5,000 in a year before any of your contributions qualify for a deduction.
  • Cap on itemized deductions: A new 35% cap applies to the total value of itemized deductions, including charitable contributions. For those in the 37% tax bracket, this means they will not receive dollar-for-dollar value from the deduction for their charitable gifts.
  • Cash donation limit made permanent: The provision from the 2017 Tax Cuts and Jobs Act that allows you to deduct cash donations up to 60% of your AGI has now been made permanent.
  • New credit for education-related giving: Starting in 2027, taxpayers can claim a nonrefundable credit up to $1,700 (or 100% of the gift, whichever is lower) for contributions to K-12 scholarship-granting organizations.
  • Universal charitable deduction introduced: The legislation introduces a new universal charitable deduction of $1,000 for individual taxpayers and $2,000 for married couples filing jointly. This is applicable even if you do not itemize your deductions. Please note: Donations made to donor-advised funds (DAFs), supporting organizations, or private foundations do not qualify for this new universal deduction.
  • Corporate giving rules updated: Corporations can now deduct charitable gifts only if they exceed 1% of their taxable income, with a 10% cap and a 5-year carry forward for unused deductions.

Plan Your Donations with Purpose

Charitable donations are not just about the heart; they can also be an integral part of your financial strategy. Understanding how your contributions fit into your overall strategy can ensure your generosity goes further. This way, you can support causes you care about and reduce your taxable income at the same time.

With the advent of the giving season, this is an apt time to take stock of your portfolio, assess your income, and identify causes that align with your values. With proper planning, you can support the organizations that matter most to you — while also strengthening your own financial future.

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