QCD Flashcards
(19 cards)
QCD stands for?
Qualified Charitable Distribution
QCDs come up with which asset?
An IRA.
Does a QCD apply to a 401(k)?
No, a QCD only applies to IRA accounts.
A rollover to an IRA is required to take advantage of the QCD.
Does a QCD apply to a 403(b)?
No
A QCD is distributed from where?
A QCD is distributed from an IRA.
The custodian of the IRA cuts a check to the charity.
Does a QCD count as a required minimum distribution (RMD)?
Yes, a QCD satisfies the RMD requirements from IRAs.
Even though it is excluded from income, a QCD counts as an RMD.
Does a QCD entitle the taxpayer to a charitable deduction?
No, a QCD reduces gross income.
Is a charitable deduction an itemized deduction?
Yes.
This means the taxpayer cannot take the standard deduction.
Can a taxpayer take advantage of a QCD while taking a standard deduction?
Yes, a QCD is an exclusion of income, not a deduction.
Itemizing deductions is not required to benfit from a QCD.
What is the age requirement for a QCD?
70½ or older.
Does the donor need something from a charity for a QCD?
Yes, the donor has to have a letter from the charity that the donor received no goods or services in exchange for the gift.
At what age do IRA owners have to take required minimum distributions (RMDs)?
IRA owners must start taking distributions every year from their IRA when they turn 73 years old.
Is there a limit on how much a QCD can exclude from income?
Yes, the most you can exclude from your income in 2025 is $108,000, but this limit is indexed for inflation.
An IRA administrator issues a payment, when is that distribution determined?
IRA distributions are determined when the IRA administrator issues the payment from the IRA account, not when it is received.
An IRA account holder cuts a check from the IRA, when is that distribution determined?
When the check is deposited, not when it is made.
Can you use a QCD for a Donor Advised Fund (DAF)?
No
Can you use a QCD for a private foundation?
No
Can you use a QCD for a supporting organization?
A 509(a)(3), “friends of the hospital”, and the like.
No
Can you use an inherited IRA to make a QCD?
Yes
As long as the benefiicary is 70 1/2 years old, or older.
