Will corporations give more—or less—because of the “One Big Beautiful Bill”?
HOW WILL TAX POLICY CHANGES IMPACT PHILANTHROPY AT THE CORPORATE LEVEL (AND YOUR NONPROFIT’S BOTTOM LINE)?
With the signing of the One Big Beautiful Bill Act (OBBB, H.R.1) on July 4, 2025, this focused on extending key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) and introducing new tax rules that have implications for the national philanthropic landscape.
At Latz & Company, we are committed to equipping nonprofits, donors and advisors with the tools and knowledge needed to navigate these changes.
Many provisions of the law take effect in 2026 which means the potential impact should be considered for fundraising planning into the coming year. At the same time, some of our clients anticipate shifts in corporate and individual giving as soon as this holiday season, as savvy corporations and individual donors seek ways to optimize their giving before the new laws take effect.
We believe in trust-based philanthropy, sustained impact, and donor flexibility—values that remain essential as giving evolves under the new rules. So, we’ve taken some time to review the law on behalf of our clients and wanted to share our perspective.
Below is a comprehensive summary of these changes, along with insights into how nonprofits can help corporations navigate and adapt to the new environment. (Check out this previous blog post that focused on individual donor giving)
CHANGES FOR CORPORATE DONORS (EFFECTIVE 2026 AND BEYOND)
1. New 1% Taxable Income Floor for Deductions.
Corporations can only deduct charitable gifts that exceed 1% of their taxable income. Example: A company with $10 million in taxable income must give more than $100,000 to begin claiming deductions.
2. 10% Cap with 5-Year Carry Forward.
Deductions are capped at 10% of taxable income. Unused charitable deductions can be carried forward for up to five years, offering greater flexibility in long-term giving.
POTENTIAL ADJUSTMENTS CORPORATE PARTNERS MAY MAKE
1. Bundle Contributions for Greater Deductibility.
Consider bunching several years of giving into a single tax year to surpass the 1% floor and unlock the deduction benefit.
2. Align Giving with Business Cycles.
Time larger charitable contributions to coincide with years of higher taxable income or major liquidity events to ensure deductibility and maximize impact.
3. Plan for Multi-Year Campaigns.
Work with financial advisors and nonprofit partners to design multi-year giving plans that ensure consistent impact while maintaining tax efficiency.
Your Impact: What does this mean for you?
KEY STRATEGY AND TACTICS FOR NON-PROFITS
1. Make a shortlist of corporations, donors, and partners who may be most likely to shift their philanthropy under this context.
2. Prioritize one-on-one outreach to these leading stakeholders, letting them know you’re aware of the changes, and you hope to continue to count on their support. Request check-in meetings where needed.
3. Encourage / support conversations your partners may be having with their tax and financial advisors and let them know you have options available to maximize giving.
4. Brainstorm ways to bundle, reflect, or allocate commitments that can help your donors get the most benefit.
5. Consider the macro perspective as important context. Recent reporting from Giving USA validates the resilience (and growth) of American philanthropy overall. Perhaps the question is less whether corporations will still support your mission, but how they will give in the future.
This new Bill provides opportunities as well as considerations for future fundraising. For corporations, you may find more them seeking structured giving strategies to meet new thresholds and optimizing deductions.
Latz & Company will continue monitoring policy developments, providing guidance, and advocating for a thriving philanthropic ecosystem.
Please feel free to reach out to the Latz team to discuss your year-end messaging or your 2026 strategy as it relates to these new tax implications. We are here to support your fundraising needs.
Disclaimer: Latz & Co. are not tax professionals, and the information provided is for general educational purposes only. It should not be considered as tax, legal, or financial advice. Please consult your own qualified tax professional or advisor for guidance tailored to your individual circumstances.