Glossary
Qualified charitable distribution
Also called QCD
Definition
A qualified charitable distribution (QCD) is a direct transfer from an IRA to a qualifying charity by an owner aged 70½ or older. It counts toward the RMD but isn't included in taxable income, which can beat itemizing the same gift.
How qualified charitable distribution works
Because the gift never becomes income, it can keep adjusted gross income lower, which affects the taxation of Social Security and Medicare premium surcharges.
The money must go directly from the IRA custodian to the charity, and donor-advised funds don't qualify. An annual limit applies.
Why it matters to a firm
QCDs combine RMD, charitable and tax planning in one move, a natural fourth-quarter recommendation for charitably inclined retirees.
Calculators that use qualified charitable distribution
Questions about qualified charitable distribution
Who can make a QCD?
IRA owners aged 70½ or older.
Can it go to a donor-advised fund?
No.
Does it count toward my RMD?
Yes.
No question matches that filter. Clear it to see them all, search the whole site, or ask us directly; we reply within one business day.
Related terms: Required minimum distribution · Itemized deductions
Next entry
Put the definition next to the number
Calculators on your site explain their own terms, in English or Spanish, before the client ever calls.
Firm and Network plans include a 14-day trial. Cancel before it ends and you pay nothing.