Why a Tax-Policy Expert Thinks the Giving Deadline Should Move

Complicated new rules for deducting charitable gifts take effect next year, and donors may be scratching their heads about how to give in the most tax-efficient way. 

But what if they didn’t have to guess? What if donors could make charitable gifts for the 2026 tax year through April 15, 2027, so they would know at the time of the gifts exactly how much federal subsidy they would receive? 

That idea — extending the deadline for prior-year giving until tax day —  is not a new one, but some experts think it’s worth reviving with all the changes coming in 2026.  

“We’ve just increased the complexity around making contributions, so maybe this is the time to make it easier for people to understand what their incentives are,” says Robert McClelland, a senior fellow at the Urban-Brookings Tax Policy Center. 

McClelland recently wrote a research brief that argues that changing current law to allow a “tax-day deduction” would be an efficient way to encourage giving. 

The most talked-about change related to charitable giving in this year’s tax law was the creation of a deduction for the majority of people who don’t itemize their taxes. Starting next year, individuals can deduct charitable giving worth up to $1,000, and couples can deduct gifts up to $2,000. 

While that change will be warmly received by people who don’t itemize, McClelland describes it as only a middling incentive. After all, many people who don’t itemize may already be giving $2,000, $5,000, or even $10,000 to charity. Those people will now get a tax break, but the new incentive — since it’s capped at $2,000 — won’t change their behavior. 

Contrast that with the “tax-day deduction.” Presumably, the only people making charitable gifts for the previous year during tax time are those who would be motivated by the incentive of a deduction. As an incentive, it’s a behavioral economist’s dream — one with a nearly 100 percent hit rate, McClelland says. 

“This change would definitely incentivize new contributions because people would realize, ‘Oh my gosh, I’m gaining an incentive, and here’s exactly what it is,’” McClelland says. 

For people who give modestly and take the standard deduction, the calculus in 2026 won’t be hard. But for people who itemize or are considering doing so — such as those with big mortgages, with substantial health expenses, or who give generously — the math will be more complicated than ever. The change causing much of the fuss is a new floor on deductions for itemizers: Any charitable donations below 0.5 percent of their adjusted gross income will not be deductible. 

“I honestly don’t know how many people know what their adjusted gross income is, much less what one half of 1 percent of it is,” McClelland says. “Many people don’t know what their tax rate is. But on tax day, if you’re using software or a tax professional, you definitely know if you’re going to itemize, and you definitely know if your contributions are in excess of one-half of 1 percent [of your income]. You know if you’re going to receive an incentive, and you know what it’s going to be.” 

Fear of Sapping Year-End Giving

The idea has floated around Washington for more than a decade. Eugene Steuerle, an economist at the Urban Institute and a co-founder of the Tax Policy Center, argued for the change in the Chronicle’s pages in 2014, the last time Congress gave it serious consideration.

“It’s a good idea that kind of fell off the radar,” McClelland says. 

By 2014, many nonprofit advocates had already rallied around the importance of creating a tax deduction for people who don’t itemize, says Steve Taylor, a senior adviser to the Charitable Independence Initiative and a longtime lobbyist for nonprofits. The support for the April 15 deadline dwindled because sector advocates didn’t want to let Congress off the hook by approving something that was “much easier to do but would have less impact” than the deduction for nonitemizers. 

Also, fundraisers at the time worried that an April 15 giving deadline would sap the vitality of year-end giving. 

But it’s not clear how fundraisers would react this time. The new floor on giving for itemizers might make it advantageous for donors to “bunch” charitable giving into certain tax years to maximize their deduction. Allowing donors to give until tax day might make it easier for them to carry out a bunching strategy — and might also reduce the volatility in donations that charities would experience if bunching catches on, says Laura MacDonald, president of the fundraising consultancy Benefactor Group. 

“It’s a very donor-centric proposal,” MacDonald says. “Would it create some challenges for philanthropy professionals? Yes. It would be our job to figure those out.” 

Sara Barba, a lobbyist who represents nonprofits and foundations, points out that support for the nonprofit sector on Capitol Hill is at a low point — and that it’s unlikely Congress would approve a policy that reduces tax revenue and primarily benefits itemizing taxpayers. Lawmakers just finished penalizing itemizers — the 0.5 percent floor and other provisions in this year’s tax legislation, which reduced charitable incentives for itemizing taxpayers, helped Congress pay for the new deduction for nonitemizers. 

“There’s probably a handful of lawmakers that would support [the tax-day deduction] in the name of supporting the nonprofit sector,” Barba says. “But from a political realities standpoint, it would be really hard for the sector to advance policies that cost more money.” 

Nevertheless, McClelland says lawmakers would be wise to revisit the idea, given that they’ve made it far more difficult for some donors to identify how giving will affect their taxes. 

“I don’t know if they quite understood that they were going to introduce this much complexity,” McClelland says, “and so I would hope that they would show some interest in it.”