Maximizing Charitable Deductions Under OBBBA's New Rules, With Ben Henry-Moreland
Advisors with charitably inclined clients get a plain explanation of how the new floor and bracket-based reduction change the value of itemized gifts. The planning discussion covers when income management or bunching may or may not be worth it, and how existing giving plans interact with the rules.
Summary
By our deskKitces.com senior financial planning nerd Ben Henry-Moreland walks through the charitable giving changes in the 2025 One Big Beautiful Bill Act, focused on the new 0.5% of AGI floor on itemized charitable contributions and the 2/37ths reduction for taxpayers in the 37% bracket. The episode covers how the rules work, who is most affected, and what the dollar impact looks like across income levels. It also discusses planning responses such as charitable bunching, donor-advised funds, the new deduction for non-itemizers and qualified charitable distributions.
- The 2025 One Big Beautiful Bill Act added a 0.5% of AGI floor on itemized charitable contributions.
- Taxpayers in the 37% bracket face a 2/37ths reduction under the new rules.
- The episode looks at the actual dollar impact across different income levels and who is most affected.
- Planning considerations include charitable bunching, donor-advised funds, the new deduction for non-itemizers and qualified charitable distributions.
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