Turning Your IRA Into a Tax-Smart Giving Tool

A Unique Opportunity for Donors 70½ and Older

For donors aged 70½ and up, the IRA isn’t just a retirement account. It can also be a powerful charitable giving tool. Through a qualified charitable distribution (QCD), individuals can donate directly from their IRA to a qualified charity, reduce their taxable income, and meet their required minimum distribution (RMD). This giving strategy isn’t new, but many donors (and nonprofits) don’t realize how impactful it can be, especially when paired with a platform like GiveClear.

What Is a Qualified Charitable Distribution (QCD)?

A QCD allows individuals aged 70½ or older to give up to $100,000 per year directly from their IRA to a qualified charity. These gifts:

 

• Count toward the donor’s required minimum distribution (RMD)
• Are excluded from taxable income
• Must be made directly from the IRA custodian to the nonprofit

 

It's a win-win. Donors meet their RMD without triggering higher taxes, and nonprofits receive
direct support.

Why QCDs Are a Strategic Giving Tool

Unlike traditional charitable gifts, QCDs don’t require donors to itemize deductions. Instead, the benefit comes from the exclusion of the gifted amount from taxable income, which can help avoid a higher tax bracket or reduce taxes on Social Security income.

For high-capacity donors, particularly those with large IRAs (for example, $1 million or more), this strategy can significantly increase the efficiency of their giving.

The GiveClear Difference: Flexibility Through a Single Charity Fund

One challenge with QCDs is that they must be made as a direct gift to a single qualified charity. They can’t go into a donor-advised fund (DAF). That’s where GiveClear offers a unique benefit. When donors make a QCD to GiveClear’s Single Charity Fund, they can:

 

• Meet their RMD and gain the tax benefit
• Avoid the need to donate the full amount in one lump sum
• Take time to decide how and when to distribute gifts to multiple charities

 

This fund gives donors the control of a DAF with the IRS alignment of a direct gift. It offers a valuable middle ground.

Empowering Donors With Smarter Giving Options

As QCDs become more widely understood, nonprofits and advisors have a powerful opportunity to educate donors on this tax-efficient strategy. And with GiveClear’s Single Charity Fund, donors don’t have to choose between flexibility and compliance.

For donors aged 70½ and up with substantial IRA balances, a QCD might be the most impactful gift they can make this year—for both their finances and their favorite causes.

 

To learn how a QCD or the GiveClear Single Charity Fund can support your giving goals, connect with us—we’re here to help you make the most of your charitable impact.

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