Corporate Giving: Advising Businesses in a New Era
Learn how your clients can make the most out of corporate giving with the new charitable deduction rules.
By Jennifer Vickerman Akaolisa, CFRE, Gift Planner
At the Saint Paul & Minnesota Foundation, we partner with business leaders and professional advisors across Minnesota to help shape charitable giving that strengthens our communities. Whether your clients support local nonprofits directly or give through a corporate fund at the Foundation, thoughtful planning has always mattered, and in 2026, it matters even more.
If you’re an attorney, CPA or financial advisor, you’re likely already discussing new rules governing corporate charitable deductions. These changes are significant and are already influencing how companies think about giving. The good news is that with the right strategy and strong local partnerships, your clients can continue to invest in the causes they care about while making the most of their tax planning.
The New Rule
As of January 1, 2026, corporations can only deduct charitable contributions to the extent that total giving exceeds 1% of taxable income.
For example, a company with $100 million in taxable income must contribute more than $1 million before any portion of its giving becomes deductible. Only the amount above that threshold qualifies.
For many businesses, this represents a meaningful shift. Gifts that once generated a tax benefit may no longer do so unless they are structured thoughtfully or timed strategically.
This is where the Foundation can work with you to help corporate clients evaluate options such as:
- Concentrating giving in certain years
- Establishing or using a corporate donor advised fund to manage timing
- Aligning charitable investments with broader financial and community impact goals
In some cases, “bundling” multiple years of anticipated giving into one year may help a client exceed the threshold and unlock a deduction that would otherwise be unavailable — while still ensuring consistent support for local nonprofits.
The 10 Percent Ceiling Still Applies
The longstanding rule allowing corporations to deduct charitable contributions up to 10% of taxable income remains in place. However, now it must be considered alongside the new one percent floor.
Only the portion of giving between one and 10% of taxable income is deductible in any given year.
The amounts below the floor or above the ceiling aren’t lost but can be carried forward for up to five years. In a few years, with effective coordination, deductions are available if giving exceeds the 1% floor and stays within the 10% cap.
For companies with fluctuating income or evolving priorities, these layered rules add complexity. The Foundation can serve as a steady partner — helping to track, coordinate and implement giving strategies over time.
Through a corporate donor advised fund, your clients can separate the timing of tax recognition from the timing of grantmaking. That means they can consistently support nonprofits across Minnesota, even while managing deductions more intentionally year to year.
The Importance of Timing and Structure
With these new rules in place, a “set it and forget it” approach to corporate giving may lead to missed opportunities.
This is a great moment to encourage your clients to revisit their overall philanthropic strategy. Together, we can:
- Model different giving scenarios based on projected income
- Create plans that smooth out year-to-year fluctuations
- Align charitable investments with business goals, employee engagement, and community impact
For many companies, philanthropy is about more than tax efficiency — it’s about showing up for the communities where employees live and work. We help ensure those dollars are deployed in ways that are both strategic and meaningful.
“These changes to corporate charitable deduction rules don’t diminish the importance of corporate philanthropy; they simply raise the bar for thoughtful planning.”
Jennifer Vickerman Akaolisa, Gift Planner
Consider Sponsorship Opportunities
It’s also important to remember that not all support for nonprofits is treated the same for tax purposes.
Payments that provide direct business benefits, such as advertising or brand visibility, are deductible as ordinary business expenses rather than charitable contributions. These arrangements require clear documentation of the benefits received.
We can help you and your clients think through these distinctions and coordinate with nonprofit partners to ensure everything is structured and documented appropriately.
These changes to corporate charitable deduction rules don’t diminish the importance of corporate philanthropy; they simply raise the bar for thoughtful planning.
Across Minnesota, businesses play a vital role in supporting nonprofits, strengthening neighborhoods, and advancing equity and opportunity. With the right strategy, your clients can continue to make a meaningful difference all while navigating this new landscape with confidence.
At the Saint Paul & Minnesota Foundation, we’re here to help. Whether your client is refining an existing giving program or building a new approach, we’re ready to partner with you to create a plan that reflects each business’s goals and maximizes impact on and in our community. Please call us at 651.224.5463 or email philanthropy@spmcf.org to be connected to one of our gift planners today.
About the Author
Jennifer Vickerman Akaolisa, Gift Planner, works to advance the Foundation’s mission by collaborating with professional advisors and donors to achieve philanthropic goals to better the lives of people in their communities. Jennifer feels that working at the Foundation, with its focus on inspiring generosity, advocating for equity, and investing to advance community visions, is a fantastic way for her to live out her personal passions in her profession. Her favorite part of her job is connecting with community members who are generous and care about being part of community-led solutions.
She previously worked as a financial advisor and in new business development for Thrivent Financial, as a gift planner for Gustavus Adolphus College, and as the Director of Development & Philanthropy for Friends of the Hennepin County Library. Jennifer holds a bachelor’s degree with majors in Music Performance and Theatre from Gustavus Adolphus College. She has earned a Fundraising Certificate from the University of St. Thomas and the Certified Fundraising Executive accredited designation from CFRE International.
The Saint Paul & Minnesota Foundation does not provide tax, legal or accounting advice. Please consult your own tax, legal and accounting advisors regarding your individual situation before engaging in any transaction.
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