If you’re over 70½ and you give to charity, there’s a smarter way to do it. Most people don’t know it exists. It’s called a Qualified Charitable Distribution (QCD) and it could save you real money every year.
Here’s the problem with how most people give in retirement. They take money out of their IRA, pay taxes on it, and then donate what’s left. Or they give from their bank account and try to deduct it. But thanks to tax law changes in 2020 and 2026, that deduction isn’t worth as much as it used to be for many retirees.
A QCD works differently. Instead of taking the money out first, it goes straight from your IRA to the charity, without ever touching your hands. And because it goes directly, the IRS doesn’t count it as income. That means no taxes on that amount at all.
Who can use one?
To make a QCD,
- You need to be at least 70½ years old.
- The money has to come from a traditional IRA, inherited IRA, or rollover IRA.
- It must go directly from your IRA to a qualified 501(c)(3) charity. Not a donor-advised fund.
In 2026, you can give up to $111,000 this way. If you’re married and both spouses have IRAs, that doubles to $222,000.*
How it helps with RMDs
If you’re 73 or older, you already know about Required Minimum Distributions (RMD). The IRS requires you to take money out of your traditional IRA every year, whether you need it or not. And that withdrawal counts as taxable income.
Here’s what makes a QCD powerful: it counts toward your RMD for the year, but it doesn’t add to your taxable income. So instead of being forced to take a distribution and pay taxes on it, you can send that money straight to a charity you care about, and satisfy your RMD at the same time.
That’s a meaningful difference, especially if a larger RMD would push you into a higher tax bracket or increase your Medicare premiums.
Why it matters even more right now
In 2026, new tax rules have made it harder for many retirees to benefit from the standard charitable deduction. A QCD sidesteps all of that. Because the money never shows up as income, you don’t need to itemize or claim a deduction. The tax benefit happens automatically, simply by doing it the right way.
Is it right for you?
If you’re over 70½, already giving to charity, and taking RMDs, a QCD is almost always worth looking at. The best time to set one up is before year-end, so don’t wait until December.
Want to talk through whether a QCD fits into your plan? Reach out to us at www.kramerwealth.com/contact.
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