One increasingly popular option is the Qualified Charitable Distribution (QCD), a provision in the tax code that allows eligible donors to transfer funds directly from their IRA to a qualified charity, bypassing taxable income in the process. For those who no longer itemize deductions or are looking to manage their required minimum distributions (RMDs), a QCD can be a highly efficient giving tool.

What Is a Qualified Charitable Distribution (QCD)?

A QCD is a direct transfer of funds—up to $100,000 per year per person—from an IRA to a qualified charitable organization. These distributions can count toward your Required Minimum Distribution (RMD) if you're age 73 or older, and, most importantly, they are not included in your taxable income.

This makes QCDs especially useful for:

• Individuals who no longer itemize deductions
• Those who want to reduce their adjusted gross income (AGI)
• Donors looking for a simple way to support charitable causes while fulfilling IRS requirements

Who Can Make a QCD?

To be eligible, you must:

• Be at least 70½ years old at the time of the distribution
• Make the donation from a traditional IRA (not a 401(k) or other retirement plan)
• Send the distribution directly from the IRA custodian to the qualified charity

Note: While you can begin making QCDs at 70½, the age for starting RMDs is now 73. QCDs made before age 73 won’t count toward RMDs, but they still offer tax benefits.

Why QCDs Are a Smart Strategy

✅ Reduces Taxable Income

Because a QCD is excluded from your taxable income, it won’t increase your AGI, which could otherwise affect taxation on Social Security or Medicare premiums.

✅ Counts Toward RMD

If you’re 73 or older, a QCD can satisfy all or part of your RMD, helping you avoid penalties while giving purposefully.

✅ No Need to Itemize

Since the QCD is excluded from income, you receive the full tax benefit even if you take the standard deduction—a key advantage for many retirees.

How It Works

The process is relatively simple:

1. Contact your IRA custodian or administrator
2. Request a direct transfer to the charity of your choice
3. Ensure the check is made payable to the organization—not to you personally
4. Notify the nonprofit of the incoming gift for tracking and acknowledgement

If you want your QCD to count for this year’s taxes, be sure it is completed by December 31.

A Meaningful Way to Give

Beyond the tax benefits, QCDs offer a meaningful opportunity to make a difference. Many donors use QCDs to support organizations that reflect their values—whether it’s addressing hunger, expanding education, supporting the arts, or preserving green spaces.

At its core, a QCD is more than a financial move—it’s a way to align your resources with your values in a thoughtful, tax-efficient manner.

Learn More

If you're approaching or past age 70½ and considering your charitable options, a QCD might be worth exploring. Speak with your financial advisor or IRA custodian to understand how it might fit into your overall giving strategy.