What is a qualified charitable distribution?
A qualified charitable distribution (QCD) is a distribution of funds from your IRA (other than a SEP or SIMPLE IRA) directly to a qualified charitable organization, such as the American Red Cross. Because the gift goes directly to the charity without passing through your hands, the dollar amount of the gift may be excluded from your taxable income up to a maximum of $100,000 annually, with some exceptions. Please consult your tax advisor for information regarding your specific exceptions.
To learn more about QCDs, please visit IRS.gov »
Who can make a qualified charitable distribution?
QCDs can be made by IRA owners who are age 70 1/2 or older. QCDs made prior to the age you are required to take a minimum distribution from your retirement assets (pre-Required Minimum Distribution QCDs) will not reduce or otherwise impact future Required Minimum Distribution. Your tax advisor can provide additional information on your particular situation.
Many individuals who are required to take money from their IRA but do not need it for living expenses have chosen to make QCDs from their IRAs to support the work of the Red Cross. This may make sense for you too!
To learn more about eligibility, please visit IRS.gov »
How do I make a qualified charitable distribution to the American Red Cross?
Your QCD must be made directly from your IRA custodian to the Red Cross on your behalf. Each financial institution has its own process for initiating a qualified charitable distribution. Account holders can sometimes find it challenging to access the right information. That’s why the Red Cross, with our partner FreeWill, is offering a free tool to guide you through the exact process required by the most popular financial institutions. If the forms required by your IRA custodian are not listed on the FreeWIll site, the tool can still provide guidance about the steps you’ll need to take to make your QCD. Many retirement plan administrators require you to use their distribution forms and comply with other requirements, so follow your financial institution’s forms and procedures to ensure you receive any potential tax benefits associated with this gift.
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