Utah · Retirement Tax Planning · Charitable Giving · 2026

Qualified Charitable Distributions (QCDs): Donate to Utah Nonprofits, Satisfy Your RMD, and Cut Taxes

If you're over 70½, support causes you care about, and want to reduce your tax bill, a QCD is one of the smartest tools available.

Utah Retirement Income Data Desk

Reviewed by Brian Penner, Retirement income & long-term care planner · Updated August 6, 2026

If you're retired and giving to charity, there's a tool that most Utah families overlook: a qualified charitable distribution. It lets you support causes you care about, reduce your tax bill, and avoid the complexity of itemized deductions — all in one move. Here's how it works and why it matters to your retirement plan.

What is a qualified charitable distribution (QCD)?

A qualified charitable distribution is a direct transfer of funds from your IRA to a qualified 501(c)(3) nonprofit. The money never touches your hands. Your IRA custodian sends it straight to the charity. The transfer is excluded from your taxable income and counts toward your required minimum distribution (RMD).

This is different from taking a withdrawal and then donating it yourself. When you do that, you have to include the withdrawal in taxable income — even if you donate the full amount to charity. QCDs skip that step entirely: the money comes out of your IRA tax-free, directly to the charity, and you never report it as income.

Who can make a QCD?

You must meet three requirements:

• Age 70½ or older when the distribution is made.
• An IRA (traditional, SEP, or SIMPLE). QCDs do not work with 401(k)s, Roth IRAs, or other retirement plans.
• Intent to give to a qualified charity (a tax-exempt 501(c)(3) organization eligible to receive tax-deductible contributions).

Note: you can start making QCDs at 70½, but you don't have to take required minimum distributions until age 73 (if you were born between 1951 and 1959) or age 75 (if you were born in 1960 or later, under the SECURE Act and SECURE 2.0). This timing gap is a huge planning opportunity.

How much can you donate via QCD in 2026?

Up to $111,000 per individual, or $222,000 for married couples filing jointly. This limit is indexed for inflation annually and applies in aggregate across all your IRAs. There's no minimum donation — you can give $1 if you want.

Source: IRS Publication 590-B (Distributions from IRAs) and 2026 tax guidance — irs.gov/retirement-plans.

QCDs and your RMD: how they work together

This is the cornerstone of QCD planning. A QCD counts dollar-for-dollar toward your required minimum distribution. Here's what that means:

Suppose you're 75, required to take a $10,000 RMD, and want to donate $4,000 to Utah nonprofits. You can make a $4,000 QCD to the charities, then withdraw only $6,000 in taxable distribution to complete your RMD. Result: $4,000 is excluded from taxable income, and only $6,000 appears on your 1040.

Compare that to the non-QCD route: you'd withdraw $10,000, report it all as income, and then donate $4,000 to charity after taxes — meaning you paid income tax on money you intended to give away.

The QCD approach saves you income tax on the amount you were going to donate anyway.

The tax benefits of QCDs

QCDs offer several tax advantages beyond the immediate exclusion from taxable income:

Lower adjusted gross income (AGI)

By reducing your AGI via a QCD, you may avoid or reduce income-based Medicare premiums (IRMAA). For 2026, Modified AGI thresholds for Part B and Part D surcharges start at $97,000 for single filers and $194,000 for married couples — and a QCD can help you stay below those levels.

Reduced Social Security taxation

Social Security benefits are taxed based on your combined income (including a portion of benefits plus other income). Lowering AGI via QCD can reduce the taxability of your benefits and keep more of your Social Security check.

Simplified charitable giving

You don't need to itemize deductions. Many retirees use the standard deduction, which means charitable donations provide no tax benefit — unless you use a QCD. A QCD gives you the tax benefit regardless of whether you itemize.

Avoids the adjusted gross income trap

Charitable donations that you itemize reduce your taxable income but not your AGI. QCDs reduce AGI, which means they avoid triggering higher Medicare premiums or Social Security taxation — even if the donation itself doesn't benefit you on a line-by-line basis.

QCD requirements: the mechanics matter

A QCD only qualifies for tax-free treatment if it meets specific requirements:

Direct trustee-to-trustee transfer

The money must transfer directly from your IRA custodian (Fidelity, Schwab, Vanguard, your bank, etc.) to the charity. You cannot withdraw the money yourself and then donate it. The IRA custodian must send it straight to the charity, and the charity must receive it.

Qualified charity only

The recipient must be a tax-exempt organization described in section 501(c)(3) and eligible to receive tax-deductible contributions. This includes most nonprofits, educational institutions, and religious organizations. It does NOT include donor-advised funds, private foundations, or charitable gift annuities.

Charitable contribution, not a loan

The transfer must be an outright gift. You cannot use a QCD to fund a charitable annuity or retain an interest in the donated property. If you expect a benefit in return (like a seat named after you), the transaction becomes more complicated.

Utah context: examples of qualified charities

Utah is home to thousands of qualified nonprofits. Utahns donated about $2.7 billion to charities in recent years, with nearly 12,215 active 501(c)(3) organizations registered in the state. Some large, well-known examples that accept QCD transfers include:

• University of Utah Foundation
• Brigham Young University Foundation (BYU)
• Utah State University Foundation
• Red Cross and humanitarian organizations
• Local healthcare and community organizations
• Religious and faith-based organizations
• Educational and research institutions throughout the state

You can verify a charity's 501(c)(3) status at IRS.gov using their Tax Exempt Organization Search (TEOS).

Source: Utah Foundation — utahfoundation.org/reports/the-state-of-nonprofits-in-utah.

Important deadlines and gotchas

December 31 deadline

The charitable organization must receive (not just acknowledge or process) the QCD by December 31 of the year for which you want it to count. There are no extensions. If you want a 2026 QCD, the money must be in the charity's hands by December 31, 2026.

RMD coordination

If you have multiple IRAs, QCDs are coordinated against your total RMD across all IRAs. You cannot use a QCD to avoid an RMD on one IRA by taking it from another.

Roth IRA clarification

Roth IRAs are not eligible for QCDs. This is a common confusion: Roth IRAs don't have RMDs during the owner's lifetime (in most cases), so there's less need for a QCD strategy. However, after-tax money in a traditional IRA is another consideration — work with a tax professional on this.

Consult your custodian early

Not all IRA custodians process QCDs the same way. Some charge fees, others have forms or procedures that take time. October or November is not too early to contact your custodian, confirm they support QCDs, and get the ball rolling.

QCDs and the changing RMD landscape

The RMD age has been rising: the SECURE Act increased it from 70½ to 72, and SECURE 2.0 increased it further to 73 for those born between 1951 and 1959, and 75 for those born in 1960 or later.

But here's the planning opportunity: QCD eligibility starts at 70½, regardless of RMD age. This means you can start making tax-free charitable donations years before you're required to take RMDs. If you're 71 and your RMD doesn't start until 73, you can already start using QCDs to reduce future tax burdens.

Source: SECURE 2.0 Act and Congress.gov — congress.gov/crs-product/IF12750.

Real-world example: how QCDs can lower your taxes

Scenario: You're 75, retired, have a $12,000 RMD, and want to donate $5,000 to the University of Utah Foundation. Your tax bracket is 22%, and you take the standard deduction.

Without a QCD: You withdraw $12,000 (taxable), donate $5,000 to the charity (no tax deduction because you don't itemize), and pay tax on the full $12,000. Tax on $12,000 at 22% = $2,640. Net cost of charity gift: $5,000.

With a QCD: You make a $5,000 QCD directly to the Foundation, withdraw $7,000 to satisfy your RMD. Only $7,000 is taxable. Tax on $7,000 at 22% = $1,540. Your $5,000 gift effectively cost $0 in additional taxes.

Tax savings: $1,100 per year. Over a 10-year retirement, that's $11,000+ in tax avoided. And you still support the causes you care about.

How to start: the checklist

• Check your age: Are you 70½ or older? Do you have a traditional IRA, SEP IRA, or SIMPLE IRA?
• Identify your charities: List the 501(c)(3) nonprofits you want to support. Verify their status at IRS Tax Exempt Organization Search.
• Check the math: How much of your RMD do you plan to give away? A QCD can cover up to $111,000 per person per year.
• Contact your IRA custodian: Ask if they support QCDs, what forms are needed, and if there are any fees or processing times. Do this by October to meet the December 31 deadline.
• Get charity acknowledgment: Ask the charity for written acknowledgment of the transfer. Keep this for your tax records.
• Report on your tax return: While a QCD is excluded from income, you still report it on your Form 1040 with a note. Your tax preparer or software can help.

This is education, not tax advice

QCDs are a legitimate tax-planning tool, but every situation is unique. Your tax bracket, RMD amount, Medicare status, and charitable goals all factor in. Work with a tax professional or financial advisor to confirm a QCD strategy makes sense for you. This article is educational — not personalized tax or financial advice. Consult with a qualified tax advisor or financial planner before acting.

Sources

• IRS — Required Minimum Distributions (RMDs)
• Congress.gov — Required Minimum Distribution (RMD) Rules for Original Owners of Retirement Accounts
• Fidelity — Qualified Charitable Distributions (QCDs)
• Utah Foundation — The State of Nonprofits in Utah
• IRS — Tax Exempt Organization Search (TEOS)