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Short answer: The 2026 changes affect the stock gift deduction, not the capital gains benefit. The non-itemizer deduction covers cash only (IRS Tax Topic 506), so shares need itemizing. Itemizers lose the first 0.5% of their contribution base in gifts, and top earners can lose up to 2/37 of itemized deductions. Stock Donator's cutoff for 2026 gifts is 24 December.
What changed for charitable deductions in 2026?
The 2025 tax law (Public Law 119-21) changed how a charitable gift is deducted from tax year 2026. Each of the rules below applies to tax years beginning after 31 December 2025.
| Change | What the law says | What it means for a stock gift | Source |
|---|---|---|---|
| Deduction for non-itemizers | Up to $1,000 of cash gifts, or $2,000 on a joint return, without itemizing | Stock does not qualify. You must itemize to deduct shares. | IRS Tax Topic 506; 26 U.S.C. 170(p) |
| 0.5% floor | Gifts are deductible only above 0.5% of your contribution base | The floor reduces gifts of appreciated stock before cash gifts | Public Law 119-21, section 70425 |
| 2/37 high-income limit | Itemized deductions fall by 2/37 of the lesser of the deductions or the income above the 37% bracket line. Income here is taxable income plus itemized deductions. | At the full reduction, a deducted dollar saves 35 cents instead of 37 | Public Law 119-21, section 70111 |
One limit also became permanent. Before the 2025 law, the 60% limit for cash gifts was set to end after 2025. Public Law 119-21, section 70425, removed the end date.
Our page on year-end charitable giving strategies turns these rules into ten moves for December.
Does the new deduction for non-itemizers cover stock?
No. IRS Tax Topic 506 (updated 24 September 2026) says that beginning with tax year 2026, if you do not itemize, you may deduct up to $1,000 ($2,000 if filing jointly) of your cash contributions to certain qualified organizations.
The cash must go to an organization described in 26 U.S.C. 170(b)(1)(A), such as a public charity, and not to a supporting organization or a donor-advised fund (26 U.S.C. 170(p)). So these gifts do not qualify:
- A gift of stock, however long you held it.
- A gift to a donor-advised fund, even in cash.
- A gift to a supporting organization, even in cash.
The 0.5% floor does not apply to this deduction. The law figures it without regard to the floor (26 U.S.C. 170(p), as amended by Public Law 119-21, section 70425), so $1,000 of cash to a public charity gives a $1,000 deduction.
The deduction is permanent. Public Law 119-21, section 70424, raised the old $300 amount to $1,000 ($2,000 jointly) and removed the year limit.
If you take the standard deduction in 2026, a gift of shares earns no charitable deduction. The capital gains side still works: you give the shares instead of selling them, and that does not depend on itemizing.
How does the 0.5% floor work?
From 2026, an itemizer's charitable gifts are deductible only to the extent the total for the year exceeds 0.5% of their contribution base (Public Law 119-21, section 70425). Your contribution base is your adjusted gross income (AGI) figured without any net operating loss carryback (26 U.S.C. 170(b)(1)(H)). For most donors, that is simply their AGI.
With a contribution base of $200,000, the floor is $1,000. The first $1,000 of your 2026 gifts gives no deduction. Every dollar above it counts, within the usual AGI limits.
Which gifts does the floor reduce first?
The law sets an order. In the statute's terms, gifts of capital gain property, such as shares held over a year, are taken into account before cash gifts to public charities, which come last (Public Law 119-21, section 70425).
If you give both shares and cash in 2026, the floor comes off the share gifts first. The order matters for the next rule: whether the floor amount can carry forward.
Does the floor amount carry forward?
Usually not. The floor amount carries forward only from a year in which your gifts also go over an AGI percentage limit, and only the part tied to the gifts that went over (Public Law 119-21, section 70425). In a year when no limit is exceeded, the floor amount is lost.
For a stock gift to a public charity, the relevant limit is 30% of AGI. A donor with a $200,000 contribution base who makes no other gifts that year would need to give more than $60,000 of appreciated shares before the floor amount on those shares could carry forward.
What is the 2/37 limit for high-income donors?
From 2026, some high-income donors lose part of their itemized deductions. The rule applies when your taxable income plus itemized deductions passes the line where the 37% bracket starts. The loss is 2/37 of the smaller of two amounts: the deductions themselves, or that income above the line (Public Law 119-21, section 70111).
For 2026, the 37% bracket starts above $640,600 for a single filer and above $768,700 on a joint return (IRS Revenue Procedure 2025-32). IRS Revenue Procedure 2025-32 lists the line for other filing statuses. At the full reduction, each deducted dollar saves 35 cents of tax instead of 37. The law applies this cut after every other limit, including the 0.5% floor.
You may see this described as a "35% cap". The law does not use that phrase. It describes a 2/37 reduction of itemized deductions, which has that effect at the top bracket.
What stayed the same for stock gifts?
Most core rules for giving shares are the same in 2026 as in 2025.
- Fair market value for shares held over a year. Shares held more than one year are capital gain property, and you can generally deduct their fair market value (IRS Publication 526, 2025).
- No tax on a sale you do not make. IRS Publication 526 (2025) describes capital gain property as property on which you would have recognized long-term capital gain had you sold it. That gain comes from a sale. If you give the shares instead of selling them, there is no sale, so you generally have no gain to report.
- Cost basis for shares held one year or less. For those, the deduction is generally limited to what you paid (IRS Publication 526, 2025).
- No deduction for a loss. If shares are worth less than you paid, your deduction is limited to their fair market value, and you cannot deduct the difference (IRS Publication 526, 2025).
- The AGI limits. Cash gifts to public charities are limited to 60% of AGI. Gifts of appreciated stock to them are limited to 30% of AGI, reduced by other gifts subject to the 60% and 50% limits (IRS Publication 526, 2025).
- The 5-year carryover. An amount over an AGI limit can be deducted in each of the next 5 years until it is used up (IRS Publication 526, 2025).
- Valuation. A listed share is valued at the average of its highest and lowest selling prices on the day of the gift (IRS Publication 561, December 2025). Our guide to IRS Publication 561 shows the calculation.
What does a $10,000 stock gift look like under the 2026 rules?
Each donor below gives $10,000 of shares, held more than a year and bought for $2,000, directly to a public charity in 2026, and makes no other gifts that year. These are examples, not tax calculations for your return.
| Donor | Charitable deduction for 2026 | The $8,000 gain |
|---|---|---|
| A: takes the standard deduction | None: stock does not qualify for the non-itemizer deduction | Generally not reported, because A gives the shares instead of selling them |
| B: itemizes; contribution base $200,000 | $9,000: the $10,000 gift minus the $1,000 floor | Generally not reported |
| C: itemizes; single; contribution base $1,000,000; income far into the 37% bracket | $5,000: the $10,000 gift minus the $5,000 floor. At the full 2/37 reduction it saves $1,750 of tax instead of $1,850. | Generally not reported |
Donor A gets no charitable deduction for the shares. A cash gift of up to $1,000 to a public charity would earn the new non-itemizer deduction.
Donor B deducts $9,000. The gift is far under the 30% limit of $60,000, so the $1,000 floor amount does not carry forward. It is lost.
Donor C faces both new rules. The floor is $5,000, so $5,000 of the gift is deductible, well under the 30% limit of $300,000. The $5,000 floor amount does not carry forward.
Will you itemize in 2026?
A stock gift earns a deduction only if you itemize. For 2026, the standard deduction is $16,100 for a single filer and $32,200 for a married couple filing jointly (IRS Revenue Procedure 2025-32). You itemize when your itemized deductions add up to more.
A higher cap on the state and local tax (SALT) deduction, in place since 2025, can help some donors get there. The cap is lower at higher incomes (Public Law 119-21, section 70120).
If you are close to the line, bunching can help: make two years of planned gifts in one year so that your itemized deductions pass the standard deduction that year. Under the floor, bunched gifts are reduced once instead of twice.
Where do QCDs and donor-advised funds fit?
A qualified charitable distribution (QCD) is a separate route. It is paid directly from your IRA to a charity, and you must be at least 70½ when it is made (IRS Publication 590-B, 2025). For 2026, up to $111,000 of QCDs can be left out of your income (IRS Notice 2025-67). A QCD cannot go to a donor-advised fund or a supporting organization (26 U.S.C. 408(d)(8)). Stock Donator processes IRA QCDs for the nonprofits it serves.
Cash gifts to a donor-advised fund do not count for the non-itemizer deduction (26 U.S.C. 170(p)). A gift to a fund is deducted in the year you make it (IRS Publication 526, 2025). Our comparison of donor-advised funds and giving stock directly sets out the two routes.
When does a stock gift count for 2026?
A gift counts in the year you actually make it (IRS Publication 526, 2025). The transfer between brokerages depends on your brokerage, so start early. Stock Donator's cutoff for 2026 gifts is 24 December 2026. Gifts after it are still processed but may not complete before 31 December.
What should you check before 31 December 2026?
- Whether you will itemize. Compare your likely itemized deductions with the 2026 standard deduction. If you will not itemize, only a cash gift of up to $1,000 ($2,000 jointly) earns a deduction. It must go to a qualifying charity, such as a public charity. A gift to a donor-advised fund or a supporting organization does not count.
- Which shares have gains. Shares held over a year with a gain can be given directly. If you itemize, you can generally deduct their fair market value (IRS Publication 526, 2025).
- Which shares have losses. For shares worth less than you paid, your deduction is limited to their fair market value, and you cannot deduct the difference (IRS Publication 526, 2025). Ask your tax adviser how to treat the loss.
- Your floor, if you itemize. Multiply your expected contribution base by 0.5%. Itemized gifts up to that amount earn no deduction in 2026.
- Your records. For a gift of $250 or more, you need a written acknowledgment from the charity. If your noncash deductions for the year are over $500, you file IRS Form 8283 (IRS Publication 526, 2025). Publicly traded shares need no qualified appraisal.
Ready to give stock in 2026?
Find the charity you want to support, choose your shares and confirm the gift. For most brokerages, Stock Donator sends the transfer request for you, and your receipt is emailed automatically. Donors pay no fees (confirmed 16 October 2026). If your charity does not accept stock yet, send them our guide on how a nonprofit can accept stock donations.
General information, not tax advice. Talk to your tax adviser.
Deposit sent to Cedar School Fund