New charitable deduction for standard filers: A win for US expats who give back
On July 4, 2025, President Trump signed a sweeping tax and spending bill into law – part of the One Big, Beautiful Bill – that permanently alters how standard deduction filers can benefit from charitable giving.
Among the provisions is a simple but powerful change: for the first time since the brief COVID-era rules, taxpayers who don’t itemize can now deduct charitable contributions. This long-sought update creates a new universal charitable deduction, modeled on bipartisan proposals like the Charitable Act.
For US expats, this provision is particularly welcome – it finally rewards giving to hometown churches, schools, or humanitarian causes, even when filing a simplified return.
A quick look: what changed
Standard deduction no longer blocks charitable benefits
Since the 2017 Tax Cuts and Jobs Act (TCJA), most Americans – including the vast majority of expats – take the standard deduction, which rose in 2025 to:
- $15,000 for single filers
- $30,000 for joint filers
While these larger deductions simplified taxes, they also meant most taxpayers got no benefit from donating to charities, since charitable deductions were only available to itemizers.
That changes as of January 1, 2026.
The new rules, in brief
| Filing status | Maximum deduction |
|---|---|
| Single | $1,000 |
| Married Filing Jointly | $2,000 |
These are above-the-line deductions, meaning they reduce your adjusted gross income (AGI) and apply even if you don’t itemize.
Example: A married couple earning $95,000 who takes the standard deduction can now deduct $2,000 in charitable contributions – lowering their taxable income to $93,000.
Who qualifies – and what counts
Taxpayers who benefit
This deduction is available to any US taxpayer who takes the standard deduction, regardless of where they live.
That includes:
- Middle-income earners;
- Retirees;
- Expats using the Foreign Earned Income Exclusion (FEIE);
- Individuals without enough deductions to itemize.
What counts as a qualifying donation?
- Monetary donations (cash, check, debit, or credit card);
- Contributions to 501(c)(3) organizations (US-registered public charities);
- Donations to:
- Churches and religious groups;
- Educational institutions;
- Food banks and humanitarian nonprofits.
Not allowed:
- Political campaigns or PACs;
- Crowdfunding sites (e.g., GoFundMe);
- Donor-Advised Funds (DAFs).
Why this matters for US expats
Expats often feel disconnected from domestic tax benefits, especially when filing with simple returns under the FEIE or with low itemizable expenses.
Yet many still:
- Tithe to a US-based church.
- Donate to causes in their hometowns.
- Support alma maters or US disaster relief groups.
Now, these contributions finally come with a tax benefit – without needing to itemize or complicate your return.
“This gives global Americans a way to contribute with both heart and strategy – no spreadsheets, no complex forms.” – TFX CPA
Historical context: a return to common sense
For decades, US tax law only rewarded charitable giving if you itemized deductions. That model shifted briefly in 2020 and 2021 under COVID relief bills, which allowed a modest above-the-line deduction ($300 single, $600 married).
The new 2025 law goes further:
- Makes the deduction permanent;
- Raises the limits to $1,000/$2,000;
- Applies regardless of income level.
This is expected to restore incentives for everyday giving, particularly among middle-class and retired taxpayers who felt left out of tax breaks post-2018.
What you need to do
To claim the deduction:
- Make your donations on or after January 1, 2026.
- Give to verified US charities.
- Keep written receipts for any gift over $250.
- Use cash-equivalent methods (not services or goods).
Planning tips for expats:
- Consider timing your donations to align with US tax years.
- If you give annually, plan to concentrate on giving post-2026.
- Be sure your chosen charity is US-based, even if it works globally.
Looking ahead
While much of the tax conversation in 2025 has focused on business deductions and estate thresholds, this new universal charitable deduction may be one of the most quietly transformative provisions.
It simplifies giving, broadens access to tax benefits, and empowers expats to support US causes without the complexity of itemizing.
At TFX, we help US expats:
- Plan charitable giving strategies.
- Maximize benefits under the new law.
- Stay compliant – without overcomplicating your return.
