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Qualified Charitable Distributions of IRAs


The ''Protecting Americans from Tax Hikes Act of 2015'' includes the provision to permanently restore the law that allows donors to make charitable gifts from their IRA accounts during tax year 2015 and beyond without incurring income tax on the withdrawal. If you are age 70½ or older and are required to take minimum withdrawals and you do not need them for personal use, a Qualified Charitable Distribution (QCD) may be a great way to make a gift to one or more qualified charities for the current tax year. While you cannot claim a charitable deduction for IRA gifts, you will not pay income tax on the amount.

Benefits of a QCD:

  • Can total up to $100,000 in each tax year (if your spouse has a separate IRA account, you can each contribute up to $100,000 per tax year);
  • Can be excluded from your gross income for federal income tax purposes on line 15a of Form 1040 (no charitable deduction is available, however);
  • If you don’t itemize deductions and are not yet required to take your RMD, a QCD offers all of the benefits of an itemized income tax charitable deduction;
  • If you are age 72 or older and must take your RMD, a QCD can satisfy your RMD without increasing your income taxes;
  • Are not subject to the 50% deductibility ceiling or the 2% rule.

To qualify:

  • You must be age 70 ½ or older at the time of the gift.
  • Transfers must be made from a traditional or Roth IRA account by your plan provider DIRECTLY to the charity. Funds that are withdrawn by you and then contributed do NOT qualify.
  • Gifts from 401k, 403b, SEP and other retirement plans do not qualify.
  • Gifts must be outright. Distributions to donor-advised funds, supporting organizations, or life-income arrangements such as charitable remainder trusts and gift annuities are precluded.

For more information

See our complete IRA gift transfer instructionsEmail us, or call us at (800) 797-8022 Ext. 5 so that we can assist you through every step of the process