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A qualified charitable distribution (QCD) allows eligible donors to support charitable organizations through a direct gift from an individual retirement account (IRA). When IRS requirements are met, the gift is excluded from federal taxable income—even if you do not itemize deductions.
What Is a QCD?
A QCD is a transfer made directly by your IRA custodian to an eligible charitable organization. Taking an IRA withdrawal yourself and then donating the money does not qualify as a QCD.
Unlike an otherwise taxable IRA withdrawal, an eligible QCD is excluded from gross income rather than claimed as a charitable deduction. You cannot also claim a charitable contribution deduction for the amount excluded from income.
Eligibility and Limits
- Age: You must be at least 70½ on the date of the distribution.
- Account: QCDs generally come from traditional IRAs, including inherited IRAs if the beneficiary meets the age requirement. Ongoing SEP and SIMPLE IRAs do not qualify. Roth IRAs may qualify, but only otherwise taxable amounts are eligible for the exclusion. Distributions directly from 401(k) and 403(b) plans do not qualify; an eligible rollover to an IRA may be possible first.
- Recipient: The gift must go to an organization eligible to receive QCDs, generally a qualifying public charity. Section 501(c)(3) status alone does not establish eligibility. Donor-advised funds, supporting organizations, and most private foundations are excluded.
- Annual limit: For 2026, the maximum QCD exclusion is $111,000 per individual across all IRAs and eligible charities. Each eligible spouse may give up to that amount from their own IRA. Deductible IRA contributions made for years beginning with the year you reach age 70½ may reduce the amount eligible for exclusion.
Potential Benefits
- Keep an otherwise taxable distribution out of income. Compared with taking a taxable IRA withdrawal, a QCD can keep adjusted gross income (AGI) lower. Depending on your circumstances, this may reduce income-related Medicare Part B and Part D surcharges, the taxable portion of Social Security benefits, or other income-based charges. These effects are not guaranteed.
- Meet all or part of a required minimum distribution (RMD). If you are subject to an IRA RMD, a QCD can count toward the amount required for that year, and your QCD may be greater than your RMD amount. RMDs generally begin at age 73 under current rules, with age 75 applying to those born in 1960 or later. Inherited IRAs have separate distribution rules. A QCD does not retroactively exclude a taxable withdrawal you already received.
- Receive a tax benefit without itemizing. The QCD exclusion is available whether you itemize or take the standard deduction. Beginning in 2026, non-itemizers may also deduct up to $1,000 in qualifying cash charitable gifts, or $2,000 for married couples filing jointly. That separate deduction does not replace the QCD exclusion and cannot be claimed for the same excluded gift.
How to Make a QCD
- Contact your IRA custodian. Ask your brokerage or bank to arrange a direct transfer to an eligible charity. Many custodians offer a QCD request form or online process.
- Confirm the recipient’s details and eligibility. Provide the charity’s legal name, mailing address, and employer identification number (EIN). Any check must be payable directly to the charity, not to you.
- Allow time for year-end processing. Work with your custodian and the charity to complete the distribution by December 31 of the year for which you want QCD treatment. Start early, because processing and check-clearing times vary.
- Keep a written acknowledgment. Obtain a letter from the charity showing the gift amount and confirming that no goods or services were provided in exchange. Keep it with your tax records.
- Report the gift on your federal tax return. Your custodian will report the distribution on Form 1099-R. Follow the applicable Form 1040 instructions to identify the QCD and exclude the eligible amount from taxable IRA income.
Support Local Financial Wellness
If you would like to support financial wellness in the Greater Shenandoah Valley, consider the DCCU Cares Foundation, the charitable arm of DuPont Community Credit Union. The Foundation supports financial education for local schools, older adults, and the broader community; scholarships for students; and grants to nonprofits working to improve community financial health. Before arranging a QCD, confirm the Foundation’s current eligibility to receive QCDs and obtain its legal name, EIN, and transfer instructions.
This article provides general educational information, not individualized tax or legal advice. Consult your tax adviser and IRA custodian about eligibility, reporting, and how the rules apply to your circumstances.
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Local Calls: 540.946.3200
Out of Area Calls: 800.245.8085
P.O. Box 1365,
Waynesboro, VA 22980
Local Calls: 540.946.3200
Out of Area Calls: 800.245.8085
P.O. Box 1365, Waynesboro, VA 22980
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