Qualified Charitable Distributions

A Tax-Smart Way to Give in 2026

If you're charitably inclined and age 70½ or older, a Qualified Charitable Distribution (QCD) may be one of the most tax-efficient ways to support causes you care about. Unlike a typical cash donation, a QCD lets you give directly from your IRA — and in many cases, it won't cost you a dime in extra taxes.

Here's what you need to know.

A QCD is a direct transfer of funds from your IRA to a qualifying charity. Because the money goes straight from the IRA custodian to the charity — never passing through your hands — it is excluded from your taxable income. That's different from a regular charitable deduction, which only helps if you itemize. A QCD helps you whether you itemize or take the standard deduction.

•      You must be at least age 70½ on the date of the distribution.

•      The distribution must come from a traditional IRA (including inherited IRAs). SEP and SIMPLE IRAs generally only qualify if they are no longer receiving employer contributions.

•      The transfer must go directly from the IRA custodian to the charity — a check made out to the charity, or a custodian-initiated transfer. Funds that pass through your personal account first, even briefly, don't qualify.

The numbers for 2026:

•      The annual QCD limit is $111,000 per person (up from $108,000 in 2025), and it's indexed for inflation each year.

•      A married couple can give up to $222,000 combined if each spouse has a separate IRA and is individually age-eligible.

•      A one-time, lifetime election allows up to $55,000 of your QCD to fund a split-interest vehicle, such as a charitable remainder trust or charitable gift annuity. This amount counts toward — not in addition to — the $111,000 annual cap.

•      If you're age 73 or older and subject to required minimum distributions (RMDs), a QCD counts dollar-for-dollar toward satisfying your RMD for the year.

•      Cash transfers from a traditional or inherited IRA to an eligible 501(c)(3) public charity

•      Gifts made directly by the custodian — check, wire, or electronic transfer payable to the charity

•      Gifts completed by December 31 of the tax year in which you want the QCD to count

•      Donor-advised funds (DAFs) — QCDs cannot be directed to a DAF, even though DAFs are popular for other types of giving

•      Private foundations — these are excluded from QCD treatment

•      Supporting organizations — certain types of supporting organizations are also excluded

•      401(k)s, 403(b)s, and other employer plans — QCDs apply only to IRAs, not workplace retirement accounts (though funds can sometimes be rolled into an IRA first)

•      Distributions that touch your hands first — if the IRA sends the money to you and you then write a check to the charity, it's treated as a regular withdrawal, not a QCD

1.    Confirm eligibility — verify age (70½+) and account type with your advisor.

2.    Identify the charity and confirm it's a qualifying 501(c)(3) public charity — not a DAF or private foundation.

3.    Contact the IRA custodian and request a direct QCD transfer. Many custodians have a specific QCD request form or checkbook feature.

4.    Specify the exact dollar amount and the charity's full legal name and mailing address.

5.    Complete the transfer by December 31 of the year you want it to count.

6.    Obtain a receipt or acknowledgment letter from the charity confirming the gift (see record-keeping below).

7.    Review the 1099-R the custodian issues the following January — it will typically show the full distribution as a regular taxable distribution, since custodians generally don't code QCDs separately. This makes the next step especially important.

8.    Report it correctly on Form 1040 — the QCD amount is reported on the IRA distribution line but excluded from the taxable amount, with “QCD” noted next to the line, per IRS instructions.

Because the 1099-R won't identify the distribution as a QCD, documentation is essential:

•      Written acknowledgment from the charity stating the date and amount of the gift, and confirming that no goods or services were received in exchange (same requirement as any charitable gift of $250 or more)

•      Confirmation from the IRA custodian showing the transfer was sent directly to the charity, not to the account owner

•      A copy of the request form or instruction letter sent to the custodian

•      A personal log noting the date, amount, charity, and tax year for each QCD made — especially useful for clients making multiple QCDs in a year or using the one-time split-interest election

•      Retain these records for at least three years after filing the return reporting the QCD (longer in cases involving amended returns or basis tracking)

Custodians can take time to process QCD requests, especially in December. If you're planning a QCD, it's wise to submit the request well before year-end — early December at the latest — to make sure it's completed and the funds reach the charity by December 31.