Under the One Big Beautiful Bill Act (OBBBA) of 2025, corporations may deduct charitable contributions only to the extent those contributions exceed 1% of taxable income, beginning with tax years beginning after December 31, 2025. This new 1% floor means that the first 1% of a corporation’s charitable giving each year will not be deductible. Without careful planning, this change could permanently disallow deductions equal to 1% of taxable income annually.

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