Yes, you can make a Qualified Charitable Distribution. A QCD is a direct transfer of funds from your IRA custodian, payable to a qualified charity. A QCDs counts toward satisfying your required minimum distributions (RMDs) for the year, as long as certain rules are met. To make a QCD, the following rules apply:
- You must be 70½ or older to be eligible to make a QCD.
- QCDs are limited to the amount that would otherwise be taxed as ordinary income. This excludes non-deductible contributions.
- The maximum annual amount that can qualify for a QCD is $100,000. This applies to the sum of QCDs made to one or more charities in a calendar year. (If, however, you file taxes jointly, your spouse can also make a QCD from his or her own IRA within the same tax year for up to $100,000.)
- For a QCD to count towards your current year's RMD, the funds must come out of your IRA by your RMD deadline, generally December 31.
- If you contribute to an IRA, it may result in a reduction of the QCD amount you can deduct.
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