Who can use a Qualified Charitable Distribution?

IRA owners who are age 70½ or older can make QCDs directly from a traditional or inherited IRA to an eligible 501(c)(3) charity.

Do QCDs count toward my Required Minimum Distribution?

Yes. QCDs can satisfy part or all of your RMD for the year as long as the transfer is made directly from the IRA to the charity.

What charities are eligible for QCDs?

Public charities that qualify under section 501(c)(3). QCDs are not allowed to donor-advised funds, most private foundations, supporting organizations, or in exchange for goods or services.

How much can I give through QCDs each year?

There is an annual dollar limit per taxpayer for QCDs. Married couples filing jointly may each make QCDs from their own IRAs, potentially doubling the family’s total.

Is a QCD better than claiming a charitable deduction?

Often yes. QCDs exclude the donation from income, which can reduce AGI-driven effects like higher Medicare premiums or lost deductions—especially useful for taxpayers who do not itemize.

What paperwork do I need to keep for a QCD?

Get a written acknowledgement from the charity stating the gift amount and that no goods or services were received in return. Your custodian will issue a 1099-R; your tax preparer should code the amount properly as a QCD.

Qualified Charitable Distributions Guide

Qualified Charitable Distributions (QCD) Guide

Qualified Charitable Distributions let IRA owners aged 70½ or older transfer money directly from their IRA to a qualified charity. The donation counts toward Required Minimum Distributions (RMDs) but is excluded from taxable income—which can help with tax brackets, deductions, and even Medicare premium brackets. This guide walks you through who qualifies, how much you can give, and the right way to document QCDs so they work exactly as intended. If your goal is to coordinate charitable giving with broader tax planning, start by skimming our playbook to reduce taxes on Social Security benefits so your giving strategy supports overall income efficiency.

QCD Basics: Who Qualifies and How They Work

QCDs are direct transfers from your traditional IRA (and in some cases inherited IRAs) to an eligible 501(c)(3) charity. The check must go directly to the charity—if the funds pass through your personal bank account, it won’t qualify as a QCD. The big win: the transferred amount won’t show up in your Adjusted Gross Income (AGI), which is often more powerful than a regular itemized charitable deduction.

Age requirement: You must be at least 70½ on the date of the distribution.
Eligible accounts: Traditional IRAs and inherited IRAs typically qualify. Employer plans generally do not, unless rolled to an IRA before the distribution.
Eligible recipients: Public charities (501(c)(3)). Donor-advised funds (DAFs), private foundations (with narrow exceptions), and supporting organizations are not eligible for QCD treatment.

If you’re also trying to manage Medicare surcharges, use QCDs to help control MAGI. For a step-by-step plan that ties charitable giving to Medicare thresholds, read our IRMAA planning strategies and align your QCD timing with those brackets.

Annual Limits and Coordination with RMDs

QCDs can count toward satisfying your Required Minimum Distribution for the year. That means you can hit your RMD target while skipping the income on the portion donated via QCD.

QCD annual cap: Subject to an annual dollar limit per taxpayer (not per IRA). Married couples filing jointly can potentially double this by making QCDs from each spouse’s own IRA.
Ordering matters: If you take a taxable IRA withdrawal first and a QCD later, the first dollars out may already be taxable. When possible, execute the QCD before taking other IRA distributions.
Documentation: Ask the charity for a receipt acknowledging the gift amount and that no goods/services were received in return.

Curious how annuity payouts interact with distribution rules? If you own or are considering annuitized IRA income, see our explainer on whether annuitization satisfies RMD requirements so your QCDs and guaranteed income work together cleanly.

Tax Advantages vs. Traditional Charitable Deductions

A QCD bypasses your tax return’s income line—lowering AGI can be more valuable than an itemized charitable deduction because many retirement “gotchas” key off AGI or MAGI (e.g., partial loss of deductions, NIIT exposure, or higher Medicare premiums). QCDs are especially useful if you don’t itemize or if the standard deduction already covers your needs.

If you’re balancing Roth conversions with charitable giving, map the timing deliberately. Conversions raise MAGI; QCDs lower it. For tactics that combine both, review our guide on using a Roth conversion with an annuity for tax-free retirement income and sequence your actions to keep income where you want it.

Eligible and Ineligible Charities for QCDs

Most public charities qualify. However, QCDs cannot be made to donor-advised funds, private non-operating foundations (generally), or for events that provide goods/services (raffles, dinners, memberships with benefits). If your favorite organization is housed at a community foundation, verify whether your gift goes to a DAF or directly to the foundation’s operating programs.

How to Execute a QCD (Step by Step)

Confirm eligibility: You are 70½ or older and the charity is a qualifying 501(c)(3).
Contact the custodian: Request a QCD and ensure the check is payable to the charity directly (not to you).
Provide charity details: Legal name, mailing address, and tax ID if requested.
Ship and document: Arrange mailing and request a written acknowledgement from the charity.
Track on 1099-R & return: The custodian issues a 1099-R. Your tax preparer reports the QCD properly so it’s excluded from taxable income.

QCD Timing Strategies You Can Use

Front-load charitable giving: Make QCDs early in the year to ensure they count toward that year’s RMD.
Bracket management: Use QCDs in high-income years (asset sales, large conversions) to help temper MAGI.
Medicare windowing: Make QCDs in the two-year lookback window that determines your future IRMAA bracket.
Legacy alignment: Pair QCDs with beneficiary updates and trusts—charities can be primary or contingent IRA beneficiaries for efficient legacy planning.

Case Study: Keeping IRMAA in Check with QCDs

Profile: Denise, age 73, has a sizable IRA, Social Security income, and a small pension. She wants to give $10,000 to two charities annually and avoid Medicare surcharge brackets.

Strategy: Denise directs $10,000 from her IRA to charities via QCDs in January, counting toward her RMD. She then calibrates any remaining RMD withdrawals later in the year to stay under the next IRMAA threshold.

Outcome: Her giving remains intact, taxable income stays lower, and she avoids unnecessary IRMAA charges—freeing cash flow for travel and family gifts.

Plan Your QCDs with a Professional

We’ll line up custodian forms, verify charity eligibility, coordinate QCD timing with RMDs, and map the impact on taxes and Medicare premiums.

Map Your QCD and RMD Game Plan

We’ll help you execute QCDs, coordinate RMDs, and keep an eye on IRMAA and Social Security taxes so your giving and income work in harmony.

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Action Steps: Make Your QCDs Count

Confirm charity eligibility and your 70½+ status.
Initiate the direct transfer from your IRA custodian to the charity.
Execute QCDs before taking other IRA withdrawals to maximize tax benefits.
Coordinate with broader income planning—Roth moves, pensions, annuities, and Social Security.

Want a deeper dive on distribution mechanics when annuities are involved? Read our primer on how annuitization can satisfy RMDs so every moving part stays aligned.