QCDs Qualified Charitable Distributions

If you have a traditional IRA and are age 70½ or older, you can consider a special tax benefit available with your account: giving up to $105,000 of Qualified Charitable Distributions (QCDs) in 2024 to operating charities (excluding donor-advised funds) tax-free.

• While withdrawals from traditional IRAs are taxable income, QCDs are not taxable.

• This can satisfy some or all of your annual required minimum distribution (RMD) if you’re age 73 or older.

• QCDs can also be used whether you take the standard deduction or itemize deductions, but note that you cannot claim a tax deduction for a QCD.

• may also direct a one-time, $53,000 QCD, within the $105,000 limit, to a charitable remainder trust (CRT)

• Contact your IRA trustee (ex. Schwab) and request your intent to do a Qualified Charitable Distribution (QCD) from your IRA to an eligible charitable organization.

• Distributions become tax-free as long as they're paid directly from the IRA to an eligible charitable organization.

• QCDs can be made electronically, directly to the charity, or by check payable to the charity. (a check made payable to the IRA owner is not a QCD.)

• A 2024 QCD must be reported on the 2024 federal income tax return, normally filed during the 2025 tax filing season.

• In early 2025, the IRA owner will receive Form 1099-R from their IRA trustee that shows any IRA distributions made during calendar year 2024, including both regular distributions and QCDs. The total distribution is in Box 1 on that form. There is no special code for a QCD.

• Donor must get a written acknowledgement of their contribution from the charitable organization, before filing their return.

• In general, the acknowledgement must state the date and amount of the contribution and indicate whether the donor received anything of value in return.

• Like other IRA distributions, QCDs are shown on Line 4 of Form 1040 or Form 1040-SR. If part or all of an IRA distribution is a QCD, enter the total amount of the IRA distribution on Line 4a. This is the amount shown in Box 1 on Form 1099-R.

• Then, if the full amount of the distribution is a QCD, enter 0 on Line 4b. If only part of it is a QCD, the remaining taxable portion is normally entered on Line 4b.

• Either way, be sure to enter "QCD" next to Line 4b. Further details will be in the final instructions to the 2024 Form 1040.

• 針對2024年的省稅角度來看，59歲半和70歲半的人在做慈善贈予的策略上有一些值得關注的事項：59歲半的人：雖然在59歲半時通常無法進行QCD捐贈，但他們仍然可以通過其他方式捐贈給慈善機構。

• 考量因素：

  1. 税率：收入，可扺稅項目總額，估算和標準扺稅額的差異（Itemized vs Standard deduction)

  2. 可動用資產：股票基金投資及淨利，退休金，其他資產 

  3. 考慮捐贈金額

  4. 綜合評估個人最佳選擇（組合）：現金／股票／Donor-Advised Fund (DAF) / 慈善信託（CRT）/ 其他

• 若#1的差異不大則考慮用逐項抵稅(itemized)來申報。捐贈有長期利得的股票或基金，DAF皆可考慮．

• 若有不少數量的股票及長期利得則考慮一次性多放些入DAF再賣，即可拿抵稅、投資免稅成長又能逐年捐贈，可藉機提領IRA. 所以可能是最佳選擇。