Federal Tax Law Changes and Possible New Opportunities for You

The new federal tax law signed in July 2025 introduces several changes that will take effect in 2026. These changes will directly affect charitable contributions, especially individuals who itemize deductions on their personal income tax returns.

Please review the summary below that may open new opportunities before December 31, 2025 and into 2026.

 

Higher Standard Deduction Made Permanent

The increased standard deduction tax law will be permanent and will be indexed annually for inflation:

Tax Filing Status 2025 2026
Single or Married Filing Separately $15,000 $15,750
Married Filing Jointly and Surviving Spouses $30,000 $31,500
Head of Household $22,500 $23,625

 

Temporary Bonus Deduction for Seniors

In addition to the standard increase, the 2025 tax law provides a temporary bonus deduction for seniors. 

  • Amount and duration: The law creates a new $6,000 deduction per qualifying individual, available for tax years 2025 through 2028.
  • Eligibility: This bonus deduction is for individuals aged 65 or older with modified adjusted gross incomes (MAGI) below $75,000 for single filers and $150,000 for couples.
  • Extra for itemizers: This new bonus deduction can be claimed even if you itemize deductions, offering an extra tax break to eligible older taxpayers.
  • Existing deduction remains: This new benefit is separate from the existing additional standard deduction for those 65 or older and/or blind. 

 

Some Other Great Options:

Smart Giving from Your IRA

Make a difference today and save on taxes. It is possible to support the Westmoreland Cultural Trust (WCT) through your IRA. Please see the opportunities listed below:

 

A Special Opportunity for Those 70½ Years Old and Older

You can give any amount (up to a maximum of $108,000) this year from your IRA directly to a qualified charity, such as WCT, without paying income taxes on the money, and you can feel good knowing  that you are supporting arts and cultural in the region. This popular gift option is commonly called the IRA charitable rollover, but you may also see it referred to as a Qualified Charitable Distribution (QCD).

 

Why Take This Action Today?

  • If you are required to take minimum distributions, you can use your gift to satisfy all or part of your obligation.
  • You pay no income taxes on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your deductions.
  • Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.
  • WCT exists because of you and your cultural needs. Earned ticket revenue and commercial rental income are approximately 70% of our annual budget. Our mission-based programming includes Rhythms of Summer, ArtsWalk, Achievement in the Arts, and Art in the Alley. As well as our tuition-based programming like Broadway to the Palace Master Class require significant subsidies.

FAQ

I am turning age 70½ in a few months. Can I make this gift now?
No. You must be 70½ by the date you make the gift.
I have several retirement accounts—some are pensions, and some are IRAs. Does it matter which retirement account I use?
Yes. Direct gifts to a qualified charity can be made only from an IRA. Under certain circumstances, however, you may be able to roll assets from a pension, profit sharing, thrift savings plan (TSP), 401(k) or 403(b) plan into an IRA and then make the transfer from the IRA directly to WCT profit-sharing, thrift savings plan (TSP), 401(k). Please speak to your plan administrator to determine if a rollover to an IRA is available for you.
Can my gift be used as my Required Minimum Distribution (RMD)?
Yes, absolutely. When you turn 73, you can use your gift to satisfy all or part of your RMD each calendar year.
Do I need to give my entire IRA to be eligible for the tax benefits?
No. You can give any amount under this provision, as long as it is no more than $108,000 this year. If your IRA is valued at more than $108,000, you can transfer a portion of it to fund a charitable gift.
When do I need to make my gift?
We must receive your gift by December 31, 2025, for your donation to qualify this year. If you have check-writing features on your IRA, please be aware that your check must clear your account by December 31, 2025, to count toward your required minimum distribution for the calendar year.
I have two charities I want to support. Can I give $108,000 from my IRA to each?
No. Under the law, you can give a maximum of $108,000 this year. For example, you can give each organization $54,000 this year or any other combination that totals $108,000 or less. Any amount of more than $108,000 in one year must be reported as taxable income.
My spouse and I would like to give more than $108,000. How can we do that?
If you have a spouse (as defined by the IRS) who is 70½ or older, they can also give any amount up to $108,000 from their IRA.
Can I use the transfer to fund life-income gifts like charitable gift annuities or charitable remainder trusts?
Yes! If you are 70½ or older, you may now make a one-time election for a qualified charitable distribution of up to $54,000 (without being taxed) from your IRA to fund a life-income gift. Some limitations apply, so contact us for more details and a personalized illustration at no obligation.
I have already named WCT as the beneficiary of my IRA. What are the benefits if I make a gift now instead of after my lifetime?
By making a gift this year of any amount up to $108,000 from your IRA, you can see your philanthropic dollars at work. Give yourself the joy of watching your philanthropy take shape in real time!
MAKE A LEGACY DONATION

Thank you again for exploring these options today. If you have any questions, please visit the WCT Legacy Giving information page at the button above.

 

Or contact Director of Development Sandee Williamson at swilliamson@wc-trust.org 

 

This summary is provided for informational purposes only. Taxpayers should consult with their independent tax advisor as soon as possible to determine whether any tax law changes apply to their specific situation.