Tax Law Changes

Charitable Contribution Deduction Floor for Itemized Deductions

A taxpayer who itemizes can only deduct charitable contributions that are more than 0.5% of adjusted gross income. This limitation is in addition to the overall limit on itemized deductions.

Charitable Contribution Deduction for Non-Itemizers

Taxpayers can claim a deduction for cash contributions made to eligible tax-exempt organizations without itemizing. The maximum deduction is $1,000 ($2,000 for married filing jointly) with certain other limitations.

Qualified Charitable Distributions

For 2026, the maximum amount of qualified charitable distributions that are not includible in gross income is $111,000 (an increase of $3,000). The maximum amount applies to each spouse if filing jointly.

Limitation on Deductible Gambling Losses

The gambling loss deduction on Schedule A (Form 1040) will be limited to lesser of (1) 90% of gambling losses or (2) gambling winnings.

Miscellaneous Itemized Deductions

• Terminates all miscellaneous itemized deductions that are subject to the 2% floor AGI limitation except for qualified educator expenses.
• Expands eligible educator expenses.

Deduction for Educator Expenses

An eligible educator with qualifying expenses may be able to claim a deduction of up to $350 for those expenses on Form 1040, Schedule 1, as well as an itemized deduction on Schedule A.

• The type of eligible expenses that qualify for each deduction are different.