As a valued partner in CFMT’s mission to strengthen our community through philanthropy, we would like to share a strategic giving opportunity that has arisen due to recent changes in federal tax law.

In July 2025, the One Big Beautiful Bill Act (OBBBA) became law. Among other things, it preserves several generous deduction rules, but it also introduces new limitations that will take effect in 2026. Here’s why this matters:

Under the current rules (i.e., gifts made before the new limitations take effect), donors may deduct cash gifts to public charities up to 60% of their adjusted gross income (AGI). OBBBA makes that generous limit permanent.

But starting in 2026, new rules will shrink the tax benefit of charitable giving for many itemizing donors. For example:

• A so-called “floor” will apply: only contributions that exceed 0.5% of AGI will be deductible for itemizers.
• For high-income taxpayers, the effective value of the deduction will be capped: even if you’re in the 37% tax bracket, you may only get about 35 cents of tax benefit per dollar donated under the new cap.

Because the new limitations begin in 2026, there is a strategic advantage to accelerating your gift into 2025 (or sooner) to lock in the higher benefit under the current rules. For a donor making a $100,000 gift, the tax savings drop noticeably under the new regime, so making the gift now rather than later could yield tens of thousands of dollars in additional tax savings.

Here are some steps you might consider:

• Review your philanthropic and tax plan with your advisor to consider whether “bunching” gifts (i.e., combining what you might give over several years into one year) makes sense for you.
• Consider making your gift to CFMT (or into a donor advised fund at CFMT) in 2025 to lock in current deduction rules.
• If you already intend to make multi-year gifts, think about bringing forward part or all of that commitment into 2025.

By acting now, you’re not only maximizing your tax-efficient giving, you’re also enabling our community foundation to deploy those resources more quickly for the benefit of our community in Middle Tennessee. 

Thank you for your generous support and partnership. We are honored to work with philanthropists like you who lead with heart, vision, and strategy.