William Martens, CPA | Director of Tax Planning - Mach 1 Financial Group
In this article, I'd like to talk about a couple of specific OBBBA provisions that will impact those taxpayers who have large deductions and still wish to itemize. One is certainly big and beautiful, and one is... not very big and not beautiful if you want to itemize.
Let's start with SALT deductions. Even more salty than that Auntie Anne's pretzel from the mall you've been craving since childhood, the new permanent SALT deductions—State and Local Taxes —were increased by the OBBBA to $40,400 for 2026, subject to AGI limits.
What this means is that while state and local tax deductions had been capped at $10,000, that cap is now increased more than four times over. That can have a huge impact on taxpayers who live in states with high income tax rates. Even with the historically high standard deduction, this one provision alone could make itemizing worth it.
Secondly, let's talk about charitable giving. The OBBBA introduced a new $1,000 permanent deduction for most cash charitable giving that can be taken even if you choose to take the standard deduction. That is great news if you're going to take the standard.
On the flip side, for itemizers, the OBBBA also introduced a floor of 0.5% of AGI that must be overcome before charitable giving can be deducted.
For example, a married couple filing jointly in 2025 with $200,000 of income who gave $50,000 was able to take the full $50,000 as a charitable deduction. Whereas that exact same couple in 2026 could only take $49,000.
Practically, this means that if you are charitably inclined, it might be prudent to consider a "bunching" strategy using a donor-advised fund, where two to three years of giving are, for tax purposes, deducted in a single year to maximize the deduction.
Looking for more information on this topic?
The One Big Beautiful Bill Act"—or OBBBA— was signed into law about a year ago. But other than being big and beautiful, what exactly does this mean for you as a taxpayer? Read more in this article: https://www.linkedin.com/pulse/standard-deduction-made-permanent-what-obbba-means-tax-erqkc
Are you a business owner? There is a section of the OBBBA tax code that may be applicable to you! Read more in this article: https://www.linkedin.com/pulse/20-tax-deduction-business-owners-probably-missing-2026-zruec