Q: “I recently turned 70½ and regularly give to nonprofits. I've heard I can make donations directly from my IRA through something called a QCD. How does that work, and what are the benefits?”

A: Yes! If you're already supporting nonprofits that matter to you, a Qualified Charitable Distribution (QCD) may allow you to continue making those gifts in a more tax-efficient way.

Once you reach age 70½, you're eligible to make QCDs. For 2026, you can give up to $111,000 per person, or $222,000 combined for a married couple, provided both spouses are at least 70½ and each makes gifts from their own eligible IRA.

Here's how it works: You direct your IRA custodian, such as Schwab or Fidelity, to send funds directly from your IRA to an eligible nonprofit. You can make multiple gifts throughout the year, whether that's $500 each to five nonprofits or a larger gift to one organization. While there’s an annual limit on QCDs, there’s no IRS minimum donation amount, although your IRA custodian may have its own requirements.

Key tax benefits:

  • Give without increasing your taxable income. Unlike a regular taxable IRA withdrawal, a QCD is generally excluded from your taxable income. You can benefit from a QCD whether you itemize deductions or take the standard deduction. It may also help reduce taxes on Social Security benefits or manage Medicare premiums.
  • Make your required withdrawals count. Once you're required to take annual withdrawals from your IRA, known as Required Minimum Distributions (RMDs), QCDs can satisfy part or all of that requirement without increasing your taxable income.
    • For example: If your annual RMD is $15,000 and you plan to give $5,000 to nonprofits, you could make that gift directly from your IRA. It would count toward your RMD, leaving $10,000 to withdraw, while keeping the charitable portion out of your taxable income.

A few things to remember: You can’t make a QCD to a donor advised fund. And you can't claim a separate charitable deduction for a QCD. To count for 2026, your QCD must be completed by December 31. Contact your IRA custodian early to allow time for processing.

If charitable giving is already part of your financial plan, it's worth considering how you give, not just how much. A QCD may help you support the causes that matter most to you while making more efficient use of your retirement savings.

Ask an Advisor is provided for general educational purposes only and should not be considered personalized financial, investment, tax, or legal advice. Readers should consult their own qualified professionals regarding their individual circumstances. Publication of this column does not imply an endorsement of any advisor or firm by the Summit Foundation.