On behalf of the Rainey Institute Board, Staff, and the hundreds of youth we serve, thank you for being dedicated and generous supporters of our mission.

You may have already heard that the tax law changes taking effect in 2026, and some that are already in place, will impact the tax benefits of your charitable donations. With my background working in the nonprofit sector and philanthropy, I have spent time familiarizing and understanding the donor-related implications of these policy changes. I wanted to point out some of the primary changes taking place you may not be aware of, so that you can discuss with your advisor how they could affect you.

Taxpayers who don’t itemize, which is the majority of us, will be able to deduct charitable contributions for the first time since 2021 beyond the standard deduction, which has also increased. Beginning in 2026, these taxpayers can claim an above-the-line deduction for qualified charitable contributions at a greater value than ever before. Taxpayers will be able to deduct an additional $1,000 for individuals ($2,000 for couples filing jointly) from their taxable income if they give at least that amount to 501(c)(3) public charities, not including Donor Advised Funds (DAFs)1.

The handful of donors who itemize their taxes will have to give more to claim a deduction for their charitable contributions, and may see smaller tax savings overall beginning in 2026. Itemizers will only be able to claim a deduction for contributions that exceed the first 0.5% of their Adjusted Gross Income (AGI). The value of itemized charitable deductions will also be capped at 35%, even if they are in the highest 37% tax bracket. Despite this, itemizing taxpayers’ can continue to benefit from the ability to now permanently deduct up to 60% of their AGI for cash contributions to 501(c)(3) public charities, which does include DAFs.

For taxpayers who are 70½ or older, Qualified Charitable Distributions (QCDs) from IRAs are still one of the most tax-efficient ways to support Rainey. Donors can give directly from their IRA, up to $108,000 per person in 2025, and $115,000 in 2026 without it counting as taxable income. These donors can also use up to $54,000 of a QCD to make a one-time donation to a Charitable Remainder Trust (CRT) or Charitable Gift Annuity (CGA).

I hope this information gives insight into the changing landscape of tax-deductible donations. I encourage you to check in with your financial advisor, as this article is not a complete assessment of new policy and legislation regarding charitable giving.

Most importantly, please know that however you chose to support Rainey this holiday season and beyond your generosity is deeply appreciated. Every brushstroke, every rehearsal, and every breakthrough moment that happens at Rainey Institute is made possible by your support.

Thank you!

1. A Donor Advised Fund (DAF) is a charitable investment account held by a public charity where all of the proceeds are legally required to go to charitable organizations. Learn more here.

Rainey Institute is registered as a 501(c)(3) non-profit organization. Contributions to Rainey are tax-deductible to the extent allowed by law. Rainey’s tax identification number is 34-6555952.

Sources
https://afpglobal.org/leaning-2025-tax-law-why-fundraisers-must-step-guides-donors
https://www.fidelitycharitable.org/articles/obbb-tax-reform.html
https://www.schwab.com/learn/story/reducing-rmds-with-qcds
https://bipartisanpolicy.org/explainer/the-one-big-beautiful-bill-acts-changes-to-charitable-deductions/
https://www.dafgiving360.org/tax-law-changes
https://www.raymondjamescharitable.org/insights/2025/09/22/new-tax-law-makes-2025-a-strategic-year-for-giving