Giving
qualified charitable distribution
A qualified charitable distribution is a gift sent straight from your IRA to a charity. You must be at least age 70½. A nontaxable QCD cannot also be claimed as a deduction.
A qualified charitable distribution (QCD) is money your IRA trustee sends directly to a qualified charity. You do not receive the money first. The IRS says you must have been at least age 70½ when the distribution was made.
If all the rules are met, a QCD may be nontaxable. The tradeoff: the IRS says that if a QCD is nontaxable, you cannot also claim it as a charitable deduction. The benefit comes from keeping the money out of your taxable income, not from a deduction.
For example: a woman age 72 asks her IRA trustee to send $5,000 straight to her church. The $5,000 never shows up as income on her return, if the rules are met. She does not add it to her itemized deductions.
Why it matters: if you take the standard deduction, a normal gift may give you no deduction, while a QCD can still keep the money out of your income. It can also help with the income-based costs that a bigger IRA withdrawal can trigger. The yearly dollar limit changes, so check the current figure with the IRS, and ask your CPA whether a QCD counts toward your required minimum distribution.
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