How to Donate Directly From Your IRA to Charity

If you are at least 70½, you can donate directly from your IRA to charity through a qualified charitable distribution (QCD) and keep the money out of your taxable income entirely. For 2026, the cap is $111,000 per person, and the tax break works whether you itemize or take the standard deduction. For retirees who already give, this is usually the most tax-efficient way to do it.

Who Can Use This Strategy

You must be at least 70½ on the day the money leaves your IRA, not the age you will reach later in the year.¹ That threshold sits below the age when required minimum distributions begin (currently 73 for most retirees), so you can start giving this way years before RMDs kick in.

Eligible accounts include traditional IRAs, rollover IRAs, inherited IRAs, and inactive SEP or SIMPLE IRAs. A SEP or SIMPLE counts as inactive if your employer has not contributed to it for the plan year that ends within the tax year of your QCD.²

Employer plans do not qualify directly. A 401(k), 403(b), 457, or active SEP or SIMPLE cannot send a QCD. You would first have to roll that money into a traditional IRA, and the rollover itself does not count as the QCD.

Roth IRAs are technically eligible, but there is almost never a reason to use one. Roth distributions are usually already tax-free, so running them through a QCD produces no extra savings.

How Much You Can Give Tax-Free

For 2026, the exclusion is up to $111,000 per person.³ The cap is per individual, not per account, and it adjusts for inflation each year in $1,000 increments. A married couple who each own IRAs can each exclude $111,000, for a household total of $222,000, but each spouse must meet the age test independently and the money must come from that spouse’s own IRA.

Anything you send above the annual cap is treated as a regular taxable distribution. You could claim a Schedule A deduction for the excess, but only if you itemize.

Which Charities Qualify

The recipient must be a public charity eligible for tax-deductible contributions under Section 170(b)(1)(A) of the tax code. That covers most places people commonly give: churches and religious organizations, hospitals, universities, and other publicly supported nonprofits.¹

Three common charity types are ruled out:

Donor-advised funds. A QCD sent to a DAF is fully taxable.
Most private non-operating foundations.
Supporting organizations described in Section 509(a)(3).

The gift also has to be a true no-strings donation. If the charity gives you anything in return, whether event tickets, merchandise, or membership perks, the distribution fails as a QCD.⁴ Even a thank-you dinner can disqualify the entire amount, so confirm with the charity beforehand that no benefit is attached.

The Tax Payoff

QCD money never appears as income on your return. A regular IRA withdrawal counts as ordinary income even if you turn around and donate the cash the same day. A QCD skips that step, because the funds move straight from your custodian to the charity and the income exclusion happens automatically.²

This is especially valuable if you take the standard deduction. A regular withdrawal followed by a personal check to charity gives you no offset if you don’t itemize. A QCD gets you the benefit anyway, because the income was never recognized to begin with.

It Counts Toward Your RMD

If you’re 73 or older and subject to required minimum distributions, a QCD counts toward that year’s RMD. If your RMD is $30,000 and you plan to give $15,000 to charity, routing that gift as a QCD cuts the taxable portion of the RMD in half. A QCD larger than the year’s RMD does not carry over. Each year’s RMD stands alone.⁵

Effects Beyond the Immediate Tax

Because a QCD lowers adjusted gross income, it can help in places that key off AGI. Medicare Part B and Part D premiums are tied to income from two years earlier, so a lower AGI can help you avoid the income-related monthly adjustment amount surcharges. The taxable share of Social Security benefits also rises with income, so keeping AGI down through QCDs can reduce how much of your benefit is taxed. The same logic applies to any tax provision with a phase-in or phase-out.

Making the Transfer the Right Way

Contact your IRA custodian, whether that’s a brokerage, bank, or fund company, and request a qualified charitable distribution. You will need the exact dollar amount and the charity’s full legal name. Most custodians have a QCD request form, and some let you start the process online.

The transfer typically happens by electronic payment to the charity’s account. Some custodians instead cut a check drawn on your IRA and made out to the charity. If you receive that check, you can mail or hand-deliver it yourself. What matters is that the payee line reads as the charity, not you.

One rule is absolute: the money cannot pass through your personal bank account. If you withdraw the funds into your checking account and then write a personal check to the charity, the full amount is a taxable distribution no matter what you intended.¹ There is no way to correct this after the fact.

The December 31 Deadline

A QCD counts for the tax year in which the charity receives the money. December 31 is the hard cutoff, with no extensions.⁵ Custodians can take a week or more to process a request, and mailed checks need time to arrive. If you’re using the QCD to cover an RMD, start well before year-end. A check mailed December 27 that arrives January 3 counts for the following year, which leaves the current RMD unsatisfied and exposed to a penalty.

Reporting It on Your Return

Your custodian reports the full distribution on Form 1099-R, with the gross amount in Box 1. Beginning with the 2025 tax year, custodians use a new Distribution Code Y in Box 7 alongside the standard code, either Code 7 for a normal distribution from a non-inherited IRA or Code 4 for a distribution from an inherited IRA.⁶ Code Y specifically flags the payment as a QCD. If your custodian has not updated its systems, you may see only Code 7 without the Y; the QCD is still valid, you just have to identify it yourself on your return.

On Form 1040, enter the full Box 1 amount on Line 4a. Enter the taxable portion on Line 4b. If the entire distribution was a QCD, Line 4b is $0. Write “QCD” next to Line 4b to explain the gap between the two numbers.⁵ If only part of the distribution was a QCD, Line 4b shows the remaining taxable amount with “QCD” still noted beside it.

Two Traps to Watch

Deductible IRA Contributions After 70½

This one catches people. If you made deductible IRA contributions after turning 70½, the IRS reduces your QCD exclusion dollar-for-dollar by the total of those contributions.¹ The reduction is cumulative across all years. If you deducted $7,000 at age 71 and another $7,000 at age 72, the first year you make a QCD your exclusion drops from $111,000 to $97,000, and the $14,000 reduction keeps applying until QCDs fully absorb it. The rule blocks a double benefit: a deduction going in and a tax-free exclusion coming out. Nondeductible contributions do not trigger it, but if you plan to make QCDs, think hard before taking a deduction for an IRA contribution after 70½.

The Favorable Treatment of Nondeductible Basis

If you have made nondeductible contributions to your traditional IRA, ordinary distributions are split between taxable and nontaxable dollars using a pro-rata rule. QCDs get an exception: they come from the taxable portion of your IRA first.¹ The QCD drains the pretax money, leaving a higher share of after-tax basis behind. Future ordinary withdrawals then carry a bigger nontaxable share, so the benefit continues past the year of the gift.⁵

The One-Time Life Income Gift

SECURE 2.0 added a once-in-a-lifetime option to direct up to $55,000 from your IRA to a charitable remainder trust or a charitable gift annuity funded entirely by the QCD.³ Instead of the charity receiving the full amount now, the arrangement pays you (and optionally your spouse) income for life, with the remainder going to the charity when payments end.

The requirements are tight:²

You can make this election only once in your lifetime.
Only you and your spouse can be named as payment recipients.
Payments must begin within one year of funding; no deferral is allowed.
A charitable gift annuity must pay at least 5% annually.
The trust or annuity cannot accept any other assets alongside the QCD funds.
Payment rights cannot be assigned or given back to the charity.
All income you receive from the arrangement is taxed as ordinary income.

The $55,000 counts against your $111,000 annual QCD limit. Fund a $55,000 charitable gift annuity and you can still make up to $56,000 in standard QCDs to other charities the same year.

Records to Keep

Get a written acknowledgment from every charity that receives a QCD. The IRS requires written documentation for any charitable contribution of $250 or more, and the acknowledgment must include:⁷

The charity’s name.
The dollar amount received.
A statement that no goods or services were provided in return, or a description and good-faith value estimate if any were.

Keep the acknowledgment with your 1099-R and your custodian’s confirmation of the transfer. If the IRS asks about the difference between Lines 4a and 4b, those three documents together substantiate the exclusion.

1
Office of the Law Revision Counsel. 26 USC 408 – Individual Retirement Accounts
2
Internal Revenue Service. Publication 526 (2025), Charitable Contributions
3
Internal Revenue Service. 2026 Amounts Relating to Retirement Plans and IRAs, as Adjusted for Changes in Cost-of-Living
4
Internal Revenue Service. Charitable Contributions: Quid Pro Quo Contributions
5
Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
6
Internal Revenue Service. Instructions for Forms 1099-R and 5498
7
Internal Revenue Service. Charitable Contributions: Written Acknowledgments