What every fundraising professional needs to know about QCDs

What every fundraising professional needs to know about QCDs

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In the nonprofit world, QCD gifts have
been growing pretty dramatically. And you might be wondering what exactly is a QCD gift? So a QCD or a Qualified Charitable Distribution is also known as an IRA
charitable rollover, and these are gifts that the donor makes directly from his
or her IRA to your organization. Because of recent tax changes this is actually
one of the best ways for many older Americans to give. Anyone over 70 and a
half can give a QCD up to $100,000—tax-free! This counts against the donors
RMD, which is a Required Minimum Distribution—the amount that they have
to take out of their IRA every year after they turn 72. And if they don’t
take it out, they face a massive fine up to 50% of this RMD. These gifts are for
traditional IRAs and Roth IRAs usually don’t see QCDs in the same way. Since
QCDs count towards a donor’s RMD, it’s a win-win for both you and the
donor. You get a sizable gift; the donor satisfies his or her RMD. And because RMDs happen every year, you can steward these folks into being annual givers out
of their IRA. You can learn more in our 2020 QCD report.

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