Trump’s New Tax Plan Could Give You $2,000 — 90% of Americans May Qualify

The Republican Party’s new tax proposal, called the ‘One Big Beautiful Bill,’ introduces a special tax break for charitable donations. It’s an “above-the-line” deduction, which means you can claim it even if you take the standard deduction—you don’t need to itemize your taxes.

This idea brings back a feature that was temporarily allowed under the CARES Act but expired in 2021. The Senate wants to make this deduction permanent, allowing up to $1,000 for individuals and $2,000 for joint filers, while the House supports a smaller amount.

Who Can Qualify for the Deduction

Nearly 90% of taxpayers may be eligible for this new charitable deduction. It’s designed to support anyone who gives to qualified charities, not just high-income earners.

The deduction would apply starting after December 31, 2025, and the Senate wants it to stay in place permanently. Lawmakers hope this move will encourage more people across the country to donate to charitable causes.

How It Affects Your Taxes

This kind of deduction can lower the amount of income you pay taxes on. The higher your tax bracket, the more you could save.

For example, someone in the 10% tax bracket might save $100 from a $1,000 donation, while someone in the 35% bracket could save $350. This setup gives a strong financial reason to give to charity, especially for those in higher-income groups.

Rules for Donations

To get the tax break, your donations must go to qualified charitable organizations. That means you can’t claim donations to political campaigns, crowdfunding sites, or donor-advised funds.

For any donation over $250, you’ll need to get a receipt. It’s also a good idea to check the IRS’s online tool to confirm that the group you’re donating to is officially tax-exempt.

What the ‘One Big Beautiful Bill’ Includes

This new tax break is just one part of a larger plan called the ‘One Big Beautiful Bill,’ which aims to make the 2017 Tax Cuts and Jobs Act’s individual tax cuts permanent.

The House passed its version of the bill in May, and the Senate released some of its proposals, like changes to student loans, in June. The goal is to get the full package ready and approved by the President by July 4.

Other Tax Breaks in the Proposal

The bill includes more than just the charitable deduction. It also proposes to remove taxes on tips, overtime pay, and auto loan interest, while raising the standard deduction for all taxpayers.

These updates are part of the Republicans’ larger mission to make the tax code simpler and offer more savings for average Americans.

Concerns Over Student Loan Changes

Some experts are worried about one part of the bill that would end the pause on student loan payments during financial hardship.

They fear it could cause more people to fall behind on their loans. But Senator Bill Cassidy defends the plan, saying it protects taxpayers who didn’t go to college from having to cover costs for those who did. Supporters claim these changes could save taxpayers at least $300 billion over time.

FAQs