This bill makes it easier for people to get tax breaks when they donate to charity. Right now, if you want to deduct charitable donations on your taxes, you have to "itemize" your deductions, which is a more complicated way of filing taxes. Most people don't do this—they just take the standard deduction instead. This bill changes that for 2026 and 2027 by letting people who take the standard deduction also deduct their charitable contributions, up to one-third of what their standard deduction is worth.

The bill also removes a penalty that currently exists. If someone claims a charitable deduction and it turns out they overstated how much they gave, they can face a 50% penalty on the taxes they owe. This bill eliminates that penalty for people using this new charitable deduction option. In practical terms, this means more everyday people might be encouraged to donate to charity since they can now get a tax benefit without having to do the more complicated itemized deduction process, and they won't face harsh penalties if they accidentally overstate their donations.

Charitable Act

Lankford, James

Charitable ActThis bill allows an individual taxpayer who does not itemize their tax deductions to claim a tax deduction for charitable contributions and eliminates the tax penalty for overstating charitable contributions. (Some limitations apply).Under the bill, for tax years beginning in 2026 or 2027, an individual taxpayer who does not itemize their tax deductions may deduct charitable contributions of up to one-third of the standard deduction allowed to such individual. (Under current law, an individual taxpayer generally must itemize their tax deductions to deduct charitable contributions.)The bill also eliminates the tax penalty for an underpayment of taxes attributable to overstated charitable contributions by taxpayers who do not itemize deductions. (Under current law, taxpayers who claim a deduction under this bill may be assessed a tax penalty in the amount of 50% of the portion of an understatement of tax liability attributable to overstated charitable contributions.)