New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Abbott Laboratories Employees: Should You Delay Charitable Giving Until 2026?

Healthcare Provider Update: Healthcare Provider for Abbott Laboratories: Abbott Laboratories operates as both a developer and provider of various healthcare products and services, focusing on medical devices, diagnostics, nutrition, and pharmaceuticals. Its health care offerings span from advanced medical devices for chronic disease management to diagnostic equipment and nutritional products aimed at enhancing patient care and outcomes. Potential Healthcare Cost Increases in 2026: As we look towards 2026, healthcare costs are anticipated to surge significantly, primarily driven by the expiration of enhanced federal premium subsidies under the Affordable Care Act (ACA). States may implement record-setting premium hikes, with some rates soaring over 60%. Combined with underlying medical cost inflation and aggressive rate increases from major insurers, consumers could face an alarming rise in out-of-pocket costs-potentially over 75% for many policyholders. This scenario underscores the pressing need for individuals to strategically prepare for the financial landscape in the coming years. Click here to learn more

'For Abbott Laboratories employees, thoughtful timing of 2025–2026 charitable gifts can influence your long-term retirement strategy, making it important to consider your broader financial plan when making these choices.' – Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

'Abbott Laboratories employees can benefit from working with tax and legal professionals to revisit their 2025–2026 charitable giving timelines, as aligning these decisions with your broader financial picture can help you stay organized and make informed choices.' – Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How the 2025–2026 rule changes may affect the tax benefits of your charitable gifts.
The different charitable deduction rules for standard deduction filers versus itemizers.
Strategies for timing your giving as a long-time Abbott Laboratories employee or retiree.

2025–2026 Charitable Giving: How New Regulations May Affect Your Tax Plan

By Wealth Enhancement's Kevin Land, CFP® and Wesley Boudreaux

Giving to charities at the end of the year has long been a December custom for many households, including long-time employees and retirees from Abbott Laboratories. However, the One Big Beautiful Bill Act has changed how charitable deductions work, with substantial updates taking effect in 2025 and 2026. As a result, the familiar “give by December 31” rule may not be the most tax-efficient approach anymore.

The law essentially establishes two different profiles of charitable donors starting in 2026:

1. Filers who take the standard deduction.
2. Filers who itemize deductions.

Depending on which group you belong to, the timing of your charitable contributions can lead to very different tax outcomes, which is especially important if most of your income and benefits come from years of work with Abbott Laboratories.

Below, we describe:

1. Who stands to gain from postponing some gifts until 2026.
2. Who stands to gain from increasing donations before or during 2025.

Group 1: Standard Deduction Filers

Why some people might prefer to wait and donate in 2026

Instead of itemizing, around 90% of Americans take the standard deduction, ¹ and many Abbott Laboratories employees and retirees may fall into this category. Under the current 2025 rules, standard deduction filers generally do not receive any direct tax benefit from charitable gifts unless they itemize.

In 2026, that will change. Specifically, a new above-the-line charitable deduction will be available to standard deduction filers beginning in the 2026 tax year: ²

- Up to $1,000 for single filers
- Up to $2,000 for married couples filing jointly

Key characteristics—written into the law:

- You do not need to itemize to claim this deduction.
- Only monetary donations given to approved public charities are covered.
- This deduction does not apply to supporting organizations or donor-advised funds.
- Non-cash gifts such as household goods, appreciated stock, and cryptocurrency are not eligible.
- The dollar limits are not indexed for inflation.

Real-world impact

In 2025, a cash donation made by a standard deduction filer is unlikely to produce any tax benefit unless that filer itemizes. If the same donor waits and gives in 2026, they may be able to deduct up to $1,000 or $2,000, depending on filing status.

For instance:

Let’s say you:

- Are married and filing jointly
- Typically donate $2,000 per year
- Expect to take the standard deduction in both 2025 and 2026
- Are in the 22% federal tax bracket

If you donate $2,000 in December 2025, you still take the standard deduction and do not gain any additional federal income tax savings from that gift.

If you instead donate $2,000 in January 2026, you can use the new $2,000 above-the-line deduction, which reduces your federal income tax by:

$2,000 × 22% = $440

Rules for documentation

Donors who give $250 or more in a single donation must obtain written confirmation stating that no goods or services were received in return for the contribution.

Who might use the standard deduction

While the standard deduction is available to all taxpayers, it may be used more often by:

- Retirees with relatively limited deductible expenses
- Younger individuals without many itemizable costs
- Higher earners who have few deductions left to itemize (for example, capped SALT deductions)

For these donors, including many who spent their careers at Abbott Laboratories, delaying certain cash gifts until early 2026 may turn previously non-deductible contributions into tax-efficient charitable giving.

Group 2: Itemizers

Reasons for wanting to accelerate gifts into 2025

For those who currently itemize, 2025 may be the final year before new deduction restrictions apply, so timing could matter for long-time professionals whose pay and benefits have grown over many years at Abbott Laboratories.

What changes in 2026?

New charitable “floor” of 0.5% of AGI

Starting in 2026, charitable contributions are only deductible to the extent they exceed 0.5% of adjusted gross income (AGI). ³

For example:

AGI: $300,000
0.5% floor: $1,500
Only the portion of your charitable contributions above $1,500 is deductible.

The 60% AGI cap on cash contributions remains

Itemizers can generally deduct up to 60% of AGI in cash contributions to qualifying public charities. ³ Any contributions above this limit may be carried forward for up to five years. This cap applies in addition to the new 0.5% floor starting in 2026.

Example for a higher-income itemizer:

Let’s say you:

- Have AGI of $500,000
- Are in the 35% federal tax bracket
- Typically donate $25,000 per year

In 2025, before the new floor applies:

- Subject to the usual AGI limits, you may be able to deduct nearly the full $25,000.

In 2026:

- 0.5% of AGI = $2,500
- Only contributions above $2,500 are deductible
- Of your $25,000 in gifts, only $22,500 may be deductible
- Losing a $2,500 deduction at a 35% tax rate may increase your federal income tax by $875

This difference can be especially important for donor-advised fund strategies or large gifts that Abbott Laboratories professionals may plan as part of a broader legacy or estate plan.

Who might itemize

Usually, itemizers have:

- AGI above the national average
- High state and local taxes
- Deductible expenses such as meaningful mortgage interest
- Long-term charitable goals and multi-year giving plans

For these individuals, accelerating larger gifts in 2025 may result in a more favorable deduction position than waiting until 2026.

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Which Group Do You Belong To?

Delaying charitable giving until 2026 might be worth considering if:

- You typically use the standard deduction
- You give $1,000 to $2,000 or more to charities each year
- You do not expect to itemize in 2025
- You could shift a cash gift from December 2025 to January 2026 and potentially use the new above-the-line deduction

Giving before year-end 2025 might be more appealing if:

- You will itemize in 2025, or already know you will have substantial itemized deductions
- You intend to make sizable, flexible charitable gifts (for example, to a major institution or to a donor-advised fund)
- The new 0.5% AGI floor in 2026 would reduce the amount you can deduct
- Frontloading your giving in 2025 allows you to keep more of your charitable deduction under the current rules

How We Help Clients Make These Decisions

At Wealth Enhancement, when we review charitable planning for employees and retirees from large companies such as Abbott Laboratories, we consider:

- Income tax planning under the One Big Beautiful Bill Act
- Health care and long-term care needs
- Multigenerational strategies and estate planning
- Business, stock option, or liquidity events that influence annual income

We help families:

- Evaluate the likelihood that they will itemize in both 2025 and 2026
- Set charitable giving goals over a three- to ten-year period
- Compare donating in 2025 versus shifting gifts into 2026
- Coordinate planning with estate planning attorneys and certified public accountants

How The Retirement Group Can Help Abbott Laboratories Employees

The Retirement Group can walk through the numbers with you and design a charitable giving approach that fits within your broader retirement strategy if you are unsure whether your 2025–2026 charitable plan should involve delaying or accelerating gifts as a current or former employee of Abbott Laboratories.

Call (800) 900-5867 to discuss how your charitable plans fit alongside your pension, 401(k), and other retirement benefits.

Next Steps

Before you write your next year-end charitable check:

- Confirm whether you expect to itemize or take the standard deduction.
- Review how the upcoming 2026 rules may affect your deductions.
- Consider whether shifting gifts into 2025 or 2026 could improve your overall tax outcome.
Reach out to Wesley Boudreaux or Kevin Landis, CFP®, at Wealth Enhancement, and consider coordinating with The Retirement Group to determine which path best aligns with your goals as a long-term employee or retiree from Abbott Laboratories.

Sources:

1. Forbes Advisor. ' Standard Deductions For 2024-2025 Tax Returns And Extra Benefits For People 65+ ,' by Taylor Tepper. Oct. 8, 2025.

2. “One Big Beautiful Bill (OBBB): Impact on Charitable Giving.” Fidelity Charitable , 2025,
https://www.fidelitycharitable.org/articles/obbb-tax-reform.html .

3. “Navigating Charitable Giving in the Wake of New Tax Reform.” National Philanthropic Trust , 30 July 2025,
https://www.nptrust.org/philanthropic-resources/philanthropist/navigating-charitable-giving-in-the-wake-of-new-tax-reform/ .

Other Resources:

1. “New Limitations on Charitable Deductions Take Effect in 2026.” Greenberg Traurig , 28 Oct. 2025,
https://www.gtlaw.com/en/insights/2025/10/new-limitations-on-charitable-deductions-take-effect-in-2026

2. “The OBBBA Clock Is Ticking: Why 2025 Might be the Year to Act for Maximum Charitable Deductions.” Vanilla , 28 Oct. 2025,
https://www.justvanilla.com/blog/obbba-year-end-charitable-planning-2026 .

3. “Charitable Organizations: Substantiation and Disclosure Requirements.” IRS , 30 Sept. 2025,
https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-organizations-substantiation-and-disclosure-requirements .

How does the Abbott Laboratories Annuity Retirement Plan (ARP) determine the eligibility requirements for employees, and how can potential changes in federal regulations impact these requirements? Employees of Abbott Laboratories may need to understand the nuances of eligibility, particularly regarding age and service criteria. Changes in laws governing retirement benefits could pose questions about continued eligibility and could affect when employees can begin pension payments.

Eligibility Requirements & Impact of Federal Regulations: Employees at Abbott Laboratories become eligible for the ARP by being part of a participating division, being at least 21 years old, and residing in the U.S. (with certain exceptions for U.S. employees abroad). Changes in federal regulations could potentially alter these eligibility criteria, especially since such rules often influence age and service requirements for retirement plans. Any changes in legislation regarding retirement benefits might necessitate adjustments in eligibility rules, affecting when employees can begin receiving pension payments.

Can you explain the significance of Vesting Service in the context of the Abbott Laboratories Annuity Retirement Plan? Employees often wonder how their years of service influence their benefit eligibility and the amount they can expect. Understanding the elements that constitute Vesting Service, and the implications of terminating employment before achieving vesting, is crucial for Abbott Laboratories employees planning for retirement.

Significance of Vesting Service: Vesting Service at Abbott Laboratories refers to the time an employee must accumulate to gain entitlement to pension benefits, irrespective of continued employment. This service is critical as it determines the security of an employee's future benefits and the degree of an employee's investment in the company's pension plan. Employees who terminate employment prior to achieving full vesting lose entitlement to accrued pension benefits, making understanding and accruing Vesting Service essential for long-term financial planning.

In what ways does the calculation of Final Average Pay play a role in determining retirement benefits under the Abbott Laboratories Annuity Retirement Plan? The methodology used to calculate an employee's Final Average Pay can significantly impact the retirement income they receive. Employees at Abbott Laboratories should consider how their earnings history and the inclusion or exclusion of certain payments factor into their anticipated benefits.

Role of Final Average Pay in Benefit Calculation: Final Average Pay (FAP) is crucial in determining the pension benefits under the ARP as it represents the average of an employee’s highest earnings over a specified period. Abbott’s ARP calculates pension based on a percentage of the FAP, multiplied by years of eligible service. This calculation means that higher earnings towards the end of an employee's career can significantly increase the pension benefits, incentivizing employees to maximize their earnings potential in their final working years.

What optional forms of payment are available to employees upon retirement under the Abbott Laboratories Annuity Retirement Plan, and how do these choices affect overall pension benefits? Abbott Laboratories employees need to evaluate whether to choose single or joint survivor annuities, among other options, as these decisions can have long-term financial implications for both themselves and their beneficiaries.

Optional Forms of Payment at Retirement: The ARP offers various payment options upon retirement, including single and joint survivor annuities, which affect the benefit's distribution and longevity. These choices impact financial planning for retirement, particularly in ensuring that a spouse or beneficiary may continue to receive benefits after the retiree's death. The selection between these options should align with personal financial needs and considerations for dependents' security.

Different employees may have varying perspectives on the importance of early retirement options offered by Abbott Laboratories. What are the qualifications for early special retirement, and how does this option affect retirement income? Employees contemplating retirement before the standard age should understand how factors such as age, years of service, and the specific provisions of the Abbott Laboratories Annuity Retirement Plan influence their benefits.

Early Retirement Qualifications and Impacts: Early retirement under the ARP is available to employees who meet specific age and service criteria, allowing them to retire with reduced benefits before reaching the normal retirement age. This option can significantly affect retirement income, depending on the number of years ahead of normal retirement age the employee chooses to retire, making it crucial for employees to understand the financial trade-offs involved in retiring early.

How does the Abbott Laboratories Annuity Retirement Plan ensure compliance with the Employee Retirement Income Security Act (ERISA), and what rights do employees have under this act? Abbott Laboratories employees should be informed about their rights regarding plan documentation, required disclosures, and recourse in the event of disputes pertaining to their retirement benefits.

ARP Compliance with ERISA: The ARP is designed to comply with the Employee Retirement Income Security Act (ERISA), providing employees with rights to information about plan features and funding, benefits accrual, and recourse in case of disputes. Compliance with ERISA ensures that employees' retirement benefits are protected under federal law, offering a framework for security and transparency in their retirement planning.

How do Abbott Laboratories employees who experience a medical leave of absence or disability maintain their retirement service credits under the Annuity Retirement Plan? Understanding the interaction between long-term disability benefits, medical leave, and retirement plan participation is essential for employees navigating health-related issues while planning for their retirement.

Impact of Medical Leave or Disability on Retirement Credits: Employees on medical leave or disability continue to accrue service credits under the ARP, ensuring that such periods do not adversely affect their pension benefits. This protection helps employees who are temporarily unable to work due to health issues maintain their trajectory towards earning full retirement benefits.

Given the potential for changes to the Abbott Laboratories Annuity Retirement Plan, how can employees stay informed about their rights and any modifications to the planâ€™s terms? Employees at Abbott Laboratories should have access to reliable communication channels, including how to receive updates about the retirement plan, which could impact their financial planning.

Staying Informed About Plan Changes: Employees can stay informed about changes to the ARP through regular communications from Abbott Laboratories, access to updated plan documents, and direct inquiries to the Abbott Benefits Center. Staying proactive in seeking information and understanding the implications of plan modifications is essential for effective retirement planning.

What processes should Abbott Laboratories employees follow if they wish to obtain a statement regarding their entitlement to a pension? Employees looking to plan for retirement need clear instructions on how to request this crucial information and understand its importance in their long-term financial strategy.

Obtaining a Pension Statement: Employees wishing to obtain a statement of their pension entitlements under the ARP should contact the Abbott Benefits Center. Clear instructions on how to request this information are crucial for employees to plan accurately for retirement and understand their accrued benefits.

If an employee at Abbott Laboratories has further questions about the Annuity Retirement Plan or requires clarification on the document contents, how can they effectively contact the appropriate department? Knowing how to reach out to Abbott Laboratories' Benefits Center regarding retirement plan inquiries is vital for all employees wanting to confirm their understanding or seek additional information about their retirement benefits.

Contacting the Appropriate Department for Plan Inquiries: For further inquiries or clarification regarding the ARP, employees should contact the Abbott Benefits Center. Knowing the correct contact information and how to reach out effectively is vital for resolving concerns and gaining a deeper understanding of their retirement benefits.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Abbott Laboratories offers an Employee Stock Purchase Plan (ESPP) that allows employees to purchase company stock at a discounted price through automatic payroll deductions. This plan operates in two periods: an "offering period" where payroll deductions accumulate, and a "purchase period" where those deductions are used to buy Abbott/AbbVie stock. The ESPP is a qualified plan, meaning contributions are made on a pre-tax basis, allowing for tax-deferred growth. Employees can benefit from lower taxes on gains if they hold the stock for at least one year and sell it at least two years after the offering date. This plan helps employees benefit from the company's performance while also providing tax savings. 401(k) Plan - Stock Retirement Plan (SRP) Abbott's 401(k) plan, known as the Stock Retirement Plan (SRP), provides a significant company match. Employees who contribute 2% of their gross pay receive a 5% company match. In 2022, employees can contribute up to $20,500 annually ($27,000 if over age 50), with employer and employee contributions capped at a combined $61,000 ($67,500 if over 50). Contributions are automatically deducted from paychecks, deferring taxes until retirement when the employee might be in a lower tax bracket. Additionally, Abbott’s Freedom 2 Save program automatically contributes up to 5% of an employee’s gross salary to the SRP plan if the employee contributes at least 2% of their income to student loan repayment. This generous matching scheme and additional programs can help employees build substantial retirement savings over time. [Source: Abbott Benefits Guide, 2022, p. 10]

Abbott Laboratories has announced significant layoffs in 2024, including the closure of its Fairfield plant, which will result in nearly 200 job losses due to cost-cutting measures. This comes amidst a broader trend of job cuts in their medtech and diagnostic divisions, particularly as demand for COVID-19 tests diminishes. Additionally, Abbott is cutting 3,000 jobs globally as part of a restructuring effort to streamline operations and improve efficiencies. This news is critical for stakeholders to understand the economic and political pressures influencing these decisions, including rising inflation, shifts in demand for healthcare products, and strategic moves to maintain financial stability in a volatile market (Hoodline) (MedTech Dive) (FierceBiotech) (FiercePharma) (Press Herald).

Abbott Laboratories offers stock options and RSUs to align employee interests with company goals. Stock options are granted with a predetermined price and vesting period, while RSUs vest over a few years based on performance or tenure. In 2022, Abbott enhanced its equity programs, emphasizing performance-based RSUs. The trend continued in 2023 and 2024, with broader RSU availability and performance-linked stock options. Executives and middle management are the primary recipients, fostering long-term alignment with company performance. [Source: Abbott Annual Reports 2022-2024, p. 34] Abbott’s RSU program provides employees with shares of company stock subject to a vesting schedule based on performance milestones or years of service. Once vested, RSUs convert to stock, and their fair market value is taxed as ordinary income. Proper tax planning around RSUs is crucial to minimize tax liability, as vesting can significantly impact income and tax brackets. Employees need to decide whether to hold or sell the stock after it becomes available, considering that selling within one year of conversion results in higher tax rates compared to long-term capital gains rates for stock held for more than a year. Integrating RSUs into a comprehensive wealth management plan is essential for maximizing their benefits.

Additional Articles

Check Out Articles for Abbott Laboratories employees

For more information you can reach the plan administrator for Abbott Laboratories at 1295 state street Springfield, MA 1111; or by calling them at 1-866-329-6277.

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