Generally, a QCD is a direct transfer of funds from an IRA owned by an individual over age 70 ½, payable directly to a qualified charity, as described in the QCD provision in the Internal Revenue Code. The maximum annual distribution amount that can qualify for a QCD is $105,000 (indexed for inflation). In general, QCDs must be reduced by the amount of deductible IRA contributions made for the year you turn 70 ½ or later. This limit would apply to the sum of QCDs made to one or more charities in a calendar year. The QCD is excluded from your taxable income. The QCD will be reported as a normal distribution on your 1099-R for any non-Inherited IRAs. For Inherited IRAs, the QCD will be reported as a death distribution. You should keep an acknowledgement of the donation from the charity for your tax records because you'll also need to report the QCD on your tax return. Information about how to report QCDs on your income tax return is available on the IRS website.
If you have any questions, please consult a qualified tax professional.
