What is a qualified charitable distribution (QCD)?

A qualified charitable distribution (QCD) is a direct transfer of funds from an IRA to a qualifying charity. Individuals who are 70 1/2 years or older may donate up to a specified annual limit, and it does not count towards taxable income. In 2026, the QCD limit is $105,000 per individual. QCDs can also count towards satisfying an individual’s required minimum distribution for the year. Since the QCD exclusion can lower your adjusted gross income, you can potentially qualify for lower taxes on Social Security and Medicare premiums.