A Case for QCDs

Margaret Davis is 74 years old and does not need the Required Minimum Distributions from her IRAs. Because she is over the age of 70 and a half, a Qualified Charitable Distribution (QCD) may satisfy her RMD and reduce her reportable income. 

Margaret can direct up to $108,000 (the 2025 limit) to qualified charities. Better yet, she can set up a designated fund at The Community Foundation to receive her QCDs (donor advised funds cannot receive QCDs) and direct them to her favorite nonprofits on a schedule. 

The designated fund supports Margaret’s favorite charities and can even be a named beneficiary in her estate plans. The QCD distribution is excluded from Margaret’s income and may reduce her exposure to Medicare IRMAA surcharges — benefits that would not have accrued if she’d simply donated from after-tax cash. 

If your client base includes people like Margaret, please give The Community Foundation a call! The tax benefits are terrific, but what’s most important is that you are helping your clients fulfill their charitable objectives, making our community and the lives of the people who live here even better for generations to come.