One Big Beautiful Bill Becomes Law: What Nonprofits Need to Know From KLR:

In July 2025, President Trump signed into law the much-anticipated One Big Beautiful Bill (OBBBA), a sweeping tax reform package with several provisions impacting nonprofit organizations and their donors.

While certain proposals were adjusted during the legislative process, the final version includes significant changes around charitable giving, endowment taxation, and nonprofit compensation rules.

Here’s a Breakdown of the Key Nonprofit-Related Elements in the Final Law:

Charitable Deduction for Non-Itemizers: Beginning in 2026, the law provides up to $1,000 in charitable deductions for single filers and up to $2,000 for married couples filing jointly who do not itemize their deductions through the end of 2029.

Corporate Charitable Giving Limits: Corporations now face stricter limits on deductible charitable contributions. Donations are deductible only to the extent they exceed 1% of taxable income, with an overall cap at 10%. Unused deductions can be carried forward for up to five years. This change may significantly affect corporate giving strategies, especially for companies with lower taxable income or those accustomed to larger philanthropic commitments.

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