What is a Qualified Charitable Distribution?
- Individuals age 70.5 and older may transfer up to $111,000 per year from their IRA* to a qualified charity without recognizing the distribution as taxable income
- IRA owners aged 73 and older may utilize this strategy to satisfy annual Required Minimum Distributions (RMDs)
* Plans that qualify for QCDs: Traditional IRAs, inherited IRAs, inactive SEP and inactive Simple Plans
Action Steps: How to make a QCD?
- A QCD must be made between institutions; the IRA owner notifies their IRA custodian who then issues a check in the specified amount payable to your selected charity (or charities)
- Individuals may distribute/transfer up to $111,000 from the IRA to charity per year; if the distribution is to count towards the IRA owner’s RMD, this transfer must be made before the December 31 RMD deadline
- Careful: Some charitable entities do not qualify as charitable organizations under this strategy including donor advised funds, private foundations and supporting organizations
Why make a QCD?
- As of age 73, IRA owners must begin to take annual RMDs which could increase income and taxes
- A QCD can satisfy the RMD requirement while helping a charity and lowering taxes
- A QCD is not a tax deduction but rather an exclusion from your taxable income; this reduces your taxable income and may thus lower your tax burden (see below illustration; focus here on federal taxes only, pre state taxes and FICA)
Supporting Information
Last Reviewed: 11/24/2025
Key Sources
- Internal Revenue Code Sections 62, 63, 170, 408, 1411
- Notice 2007-7, 2007-5 I.R.B. 395, IR 2024-289
- IRS Notice 2025-67
Further Reading
- IRS Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs)
- IRS Retirement Plans-IRA FAQs-Distributions (Withdrawals)
- IRS Notice 2025-67
Archford Capital Strategies, LLC (“Archford”) is a Registered Investment Advisor, registered with the U.S. Securities and Exchange Commission (“SEC”). Registration as an investment advisor does not imply a certain level of skill or training. The information presented has been prepared on the basis of publicly available information, internally developed data or other third-party sources. There is no guarantee as to the accuracy, completeness, or reasonableness of the contents contained herein. Archford Capital Strategies, LLC and its affiliates do not provide legal advice. Tax and accounting services are offered through Archford Accounting, LLC, an affiliated entity of Archford Capital Strategies.
