Quick answer
What is charitable bunching, and does it still work in 2026?
Bunching means making several years of charitable gifts in one tax year, so your itemized deductions clear the standard deduction ($32,200 married filing jointly in 2026), then taking the standard deduction in the off years. It still works in 2026, and the new 0.5%-of-AGI floor makes it more valuable because you pay the floor once per bunch.
Key takeaways
- 01Bunch when your annual giving barely clears the standard deduction, or not at all.
- 02A DAF lets you bunch the deduction while charities still get money every year.
- 03The 0.5% floor is charged per itemizing year, so fewer, bigger years lose less to it.
- 04Use appreciated stock for the bunch and stay inside the 30%-of-AGI limit.
| 2026 standard deduction (MFJ) | $32,200 |
|---|---|
| 2026 standard deduction (single) | $16,100 |
| Floor | 0.5% of AGI per itemizing year |
| Typical bunch | 2 to 3 years of giving |
| Best vehicle | Donor-advised fund |
| Off-year bonus | $1,000 / $2,000 non-itemizer cash deduction |
The Short Answer
What is charitable bunching and does it still work in 2026?
Bunching means concentrating several years of charitable gifts into one tax year so your itemized deductions clear the standard deduction ($32,200 married filing jointly, $16,100 single in 2026), then taking the standard deduction in the off years. It still works in 2026, and the new 0.5%-of-AGI floor makes it more valuable: you pay the floor once per bunch instead of every year.
This is part of our series on donating appreciated stock. The usual vehicle is a donor-advised fund funded with appreciated stock: you take the deduction in the bunching year and grant to charities over time.
The 2026 Rules
What changed for charitable deductions in 2026?
| Rule (tax year 2026) | What it is |
|---|---|
| Standard deduction | $32,200 MFJ, $16,100 single, $24,150 head of household (Rev. Proc. 2025-32) |
| 0.5% AGI floor (itemizers) | Only charitable gifts above 0.5% of AGI are deductible. At $400K AGI the first $2,000 is lost each year you itemize. Disallowed amounts can carry forward only when the gifts also exceed the AGI ceilings. |
| 35% benefit cap | Filers in the 37% bracket see the value of itemized deductions reduced so the benefit is roughly 35 cents per dollar, not 37 |
| Non-itemizer deduction | Up to $1,000 single / $2,000 MFJ for cash gifts to operating public charities. Gifts to DAFs and private foundations do not qualify; the 0.5% floor does not apply |
| AGI ceilings | 60% of AGI for cash to public charities (made permanent); 30% for appreciated stock to public charities and DAFs; 5-year carryforward |
| SALT cap | $40,400 in 2026, phasing down toward $10,000 for MAGI above about $505,000, which affects whether you itemize at all |
The non-itemizer deduction does not reward DAF gifts.: The $1,000/$2,000 deduction is for cash given directly to operating charities. In your off years, give small cash gifts directly to capture it, and keep the big bunched gift for your DAF in the itemizing year. Details in charitable deduction limits for 2026.
Run Your Numbers
Bunching vs annual giving over three years
The calculator compares three years of equal annual gifts with one gift of three years' worth followed by two standard-deduction years. It assumes married filing jointly ($32,200 standard deduction), that your other itemized deductions (capped SALT, mortgage interest) stay the same each year, and that the gift fits within the AGI ceilings.
Calculator
3-year bunching vs annual giving
Enter your other itemized deductions, your yearly gift, AGI and marginal rate. Rates above 35% are capped at 35% to reflect the 2026 benefit limit.
3-yr deductions, give annually
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3-yr deductions, bunched
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Est. tax saved by bunching
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Illustrative only; not tax advice. Assumes MFJ, a flat marginal rate, constant AGI, and no non-itemizer cash deduction in off years (that could add up to $2,000/yr of deductions for direct cash gifts). Ignores state tax, AMT and the precise mechanics of the 35% cap.
Chart
Three-year deductions: annual vs bunched (defaults)
The 0.5% Floor
Why does the 0.5% AGI floor make bunching better?
The floor is paid once per itemizing year. Give annually and you lose 0.5% of AGI three times; bunch and you lose it once. Higher earners lose more per year:
Chart
Charitable gifts lost to the 0.5% floor each itemizing year
"The 2026 floor turns bunching from a standard-deduction workaround into a way to pay a fixed toll once instead of every year."
Where Embark fits
Bunching fixes the deduction. What about the shares you're keeping?
Give your lowest-basis lots to a DAF. Then run your ticker to see what the rest of the position could target in income.
- Bunching handles the shares you give; Embark handles the ones you keep
- §721 in-kind contribution, $0 tax at contribution, same as a stock gift
- Targets 10%+ annual income while you keep the upside
Run the numbers
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How to Bunch
A step-by-step bunching plan
Fund the DAF with appreciated stock
Transfer long-held, low-basis shares in kind. You deduct the fair market value (up to 30% of AGI) and never pay the capital gain. Pair the bunching year with a high-income year, such as an RSU vest or a liquidity event, when the deduction is worth most.
Grant on your normal schedule
Charities keep receiving steady support from the DAF; nothing about the bunch is visible to them.
Take the standard deduction
Make small direct cash gifts to operating charities to use the $1,000/$2,000 non-itemizer deduction.
Repeat or adjust
Re-run the calculator with your current AGI, SALT situation and rate.
Do
- Donate stock held more than one year with the largest unrealized gain
- Bunch in your highest-income year
- Check the 30% AGI ceiling for stock; excess carries forward 5 years
- Keep the broker transfer confirmation and the DAF acknowledgment
Don't
- Don't give shares held a year or less; the deduction is limited to basis
- Don't donate stock trading below basis; sell it, harvest the loss and give cash
- Don't count DAF gifts toward the non-itemizer deduction
- Don't forget state rules, which may not follow the federal changes
The Shares You Keep
Pairing bunching with Embark
Bunching handles the shares you give. For a concentrated position you want to keep, Embark contributes the stock to an SPV in a Section 721 in-kind partnership contribution: $0 tax at contribution, targeted 10%+ annual income, and you keep the upside. It is for accredited investors, income is targeted rather than guaranteed, contributed shares have a 3-year lock-up, and it produces no deduction, so it complements a DAF rather than replacing one. Weigh the trade-offs in the donate stock vs cash vs sell checklist and when to diversify concentrated stock.
FAQ
Frequently asked questions
What is the standard deduction for 2026?
$32,200 for married filing jointly, $16,100 for single filers and $24,150 for heads of household, per IRS Rev. Proc. 2025-32.
Can I bunch with a DAF and still claim the non-itemizer deduction?
Yes, in the years you don't itemize, but only for cash given directly to qualifying operating charities. DAF contributions are excluded.
Does the 0.5% floor apply to non-itemizers?
No. The floor applies only to itemized charitable deductions.
How many years should I bunch?
Two or three years is common. More years means a bigger deduction but runs into the 30%-of-AGI limit for stock; excess carries forward five years.
Is the 35% cap a cap on the charitable deduction only?
It reduces the tax benefit of itemized deductions overall for taxpayers in the 37% bracket, so each dollar given saves about 35 cents rather than 37.
Do I lose anything by not itemizing in off years?
Only deductions you would have itemized anyway, such as state taxes and mortgage interest. Add them up both ways before you pick a bunch year.
Should I bunch in a high-income year?
Usually yes. A big RSU vest, bonus or liquidity event raises both your bracket and your 30% stock limit.
Can a married couple bunch with separate DAFs?
Yes, but the deduction is measured on your joint return. One DAF is simpler unless you give to different causes.
Sources
Primary sources
Sources
Cite this article
Embark Funds Research. “Bunching Charitable Deductions in 2026.” Embark Funds, updated October 15, 2026. https://www.embarkfunds.com/insights/bunching-charitable-deductions-2026
Not tax, legal or securities advice: This article is educational. Charitable, securities and tax rules depend on your facts and your company's policies. Work with a CPA, an estate attorney and, for insiders, securities counsel before acting. Embark income figures are targets, not guarantees, and contributed shares have a 3-year lock-up.
Charitable Giving with Appreciated Stock Series
6 of 7
Keep reading
Donor-Advised Funds for Appreciated Stock
A donor-advised fund lets you give stock today, take the deduction this year, and choose charities later. Here is how the deduction, the limits, the fees and the sponsors work in 2026.
Charitable Deduction Limits for 2026: What Changed
How much you can deduct depends on what you give and who receives it. From 2026, OBBBA added a floor, a cap and a new non-itemizer deduction. Here are all the numbers in one place.
Donate Appreciated Stock and Save a Fortune on Taxes This Year
Give shares instead of cash and you get two tax wins at once: no capital gains tax on the growth, and a deduction for the full market value. Here is how it works in 2026, after the One Big Beautiful Bill Act changed the math.
Donate Stock, Cash or Sell? The 2026 Checklist
For appreciated stock held over a year, donating the shares beats selling them and giving the cash, almost every time. Use this checklist to decide which shares to give, when cash is better, and when to keep the position working instead.
Give Some. Put the Rest to Work.
Bunch Your Gifts, Then Make the Rest of Your Stock Earn
Fund your DAF with your lowest-basis shares. For the position you keep, Embark's §721 in-kind contribution triggers $0 tax at contribution and targets 10%+ annual income. Accredited investors only; income is targeted, not guaranteed, and contributed shares have a 3-year lock-up.