When you do a QCD (Qualified Charitable Deduction) from your IRA you tell your fiduciary how much and to what charity part of your withdrawal is being donated. Your fiduciary sends the donation directly to the charity or may send you the check made out to the charity for you to send to the charity (Vanguard does that). When you report your 1099-R you tell the program how much of your IRA is the charitable donation and the program includes in your income only the amount not contributed to the charity. So in effect the donation decreases your AGI.
