Linda Yeager, CFP^®, AAMS^®, FPQP™,
Senior Wealth Manager, Chief Compliance Officer

What if you could turn a required IRA withdrawal into a meaningful act of generosity?

A Qualified Charitable Distribution (QCD) lets you satisfy your required minimum distributions (RMDs) in a tax-efficient way — while supporting the causes and communities that matter most to you.

This guide explains how Qualified Charitable Distributions work, who can use them, and how QCDs can help you shape a family philanthropic legacy that endures.

What Is a Qualified Charitable Distribution?

A Qualified Charitable Distribution (QCD) is a tax-free gift made directly from your traditional IRA to a qualified charity.

Key QCD facts:

• You must be age 70½ or older to make a QCD.
• QCDs count toward all or part of your Required Minimum Distributions (RMDs), which begin at age 73.
• For 2025, you can give up to $108,000 per person — spouses can each make a separate QCD up to the limit.¹

How Do Qualified Charitable Distributions Work?

If you have a traditional IRA, you must start taking RMDs at age 73 — even if you don’t need the income. This can increase your taxable income, bump you into a higher tax bracket, and reduce certain deductions or credits.

A QCD works differently²:

• The distribution is not included in your taxable income, lowering your adjusted gross income (AGI).
• Lower AGI may reduce your Medicare Part B and D premiums.
• You don’t have to itemize deductions to benefit.
• Because you’re lowering your IRA balance, you may reduce future RMDs and future income taxes.

Potential benefits of using a QCD:

• Satisfy all or part of your RMD.
• Limit pushing your income into a higher tax bracket.
• Preserve deductions and credits tied to AGI.
• Support charities you care about in a tax-smart way.

How QCDs Support Your Family’s Philanthropic Legacy

Qualified Charitable Distributions are more than a tax strategy — they’re a way to make giving part of your family story.

1. Involve future generations.
Use QCDs as an opportunity to talk with your children or grandchildren about charitable priorities, values, and impact.

2. Complement your estate plan.
QCDs reduce your IRA balance during your lifetime, which can lower future taxable income for your heirs. In 2025, you may use up to $54,000 of a QCD for a one-time gift to a charitable gift annuity (CGA) or charitable remainder trust (CRT).³

3. Give without affecting your cash flow.
QCDs use pre-tax retirement dollars — so you can make larger gifts without reducing other savings you rely on.

4. Maximize giving beyond AGI limits.
QCDs are not subject to the usual AGI-based charitable deduction limits, so you may give more than you could with cash alone.

Key Rules and Deadlines for QCDs

Before using a QCD, keep these important requirements in mind:

• No double-dipping: You can’t claim a charitable deduction for a QCD amount.
• Eligible accounts: Traditional IRAs, inactive SEP IRAs, and inactive SIMPLE IRAs.
• Timing: The transfer must go directly from your IRA custodian to the charity by December 31 of the tax year. Allow enough time for processing.⁴
• Restrictions: Private foundations, donor-advised funds, and supporting organizations cannot receive QCDs.

Is a Qualified Charitable Distribution Right for You?

When used thoughtfully, Qualified Charitable Distributions can help you:

• Reduce your tax burden in retirement
• Support your favorite causes
• Teach younger generations about values-based giving
• Create a legacy defined by purpose and generosity

Take the Next Step Toward Your Legacy

Ready to see if a QCD fits your retirement income plan or estate strategy?
We’re here to help you align your giving with your financial goals — so your wealth does more than last… it inspires.

Reach out today to talk about how QCDs can help you build a legacy that withstands the test of time.

Sources
¹ https://www.fidelitycharitable.org/guidance/philanthropy/qualified-charitable-distribution.html
² https://www.edelmanfinancialengines.com/education/tax/how-qualified-charitable-donations-can-lower-your-taxes/
³https://www.schwab.com/learn/story/reducing-rmds-with-qcds
⁴ https://www.fidelity.com/retirement-ira/required-minimum-distributions-qcds

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They are based on assumptions and estimates that may not be accurate or applicable to your individual situation. Always consult with a qualified financial advisor before making any investment decisions.

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