Qualified Charitable Distributions

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Qualified Charitable Distributions

Overview

Support your passion!

If you are at least 70½ years old, you are eligible in 2024 to make Qualified Charitable Distributions (QCDs) from your IRA(s) of up to $105,000 in outright gifts annually, including a one-time-only QCD of up to $53,000 to create a life income gift. QCDs count toward required minimum distributions, and QCDs used to make outright gifts are excluded from federal taxable income entirely (payments you receive from a life income gift will be taxed as ordinary income when received).

You may direct a QCD to benefit the University of Virginia school(s) or program(s) of your choice, and you can designate the distribution for unrestricted use (to meet greatest current needs) or for other charitable purposes you select, such as financial aid or faculty support. If you want to restrict your QCD to support a particular purpose, please contact the Office of Gift Planning so that UVA can review your proposed use and confirm we can carry out your wishes as you intend.

Qualified Charitable Distributions

QCD Considerations

  • You must be at least 70½ years old to be eligible to make a QCD.
  • QCDs must be made from IRAs (including inactive SEP and SIMPLE plans). Distributions from any other type of retirement plan (401(k), 403(b), 457, Keogh, etc.) will not qualify.
  • In 2024, you can now make QCDs totaling up to $105,000 annually (the original $100,000 limit has been indexed for inflation).
  • QCDs used to make outright gifts are excluded from federal taxable income and count toward required minimum distributions (RMDs). If you are subject to an RMD, the federal tax exclusion may allow you to remain in a lower income tax bracket and potentially eliminate “high income” tax penalties. If you will claim the income tax standard deduction, a QCD may act like an itemized deduction by reducing federal taxable income dollar for dollar.
  • In 2024, you can now make in a single calendar year during your lifetime QCDs totaling up to $53,000 (the original $50,000 limit has been indexed for inflation) to fund a new charitable gift annuity or charitable remainder trust for you, your spouse, or both of you; any remaining QCD allowance for that year must be used for outright gifts. Your QCD will be excluded from federal income in the year you create your gift and will count toward an RMD. Payments you receive from a charitable remainder trust or gift annuity will be taxed as ordinary income when received.
  • You cannot claim a federal income tax charitable deduction for your QCD. State laws may vary, and some states may treat QCDs as taxable income followed by a deduction. Please consult your tax advisor to learn more.
  • QCDs must benefit qualified charities. QCDs cannot be made to donor-advised funds or family foundations.
  • QCDs must be distributed directly to the charity by your IRA administrator—amounts distributed to you first and then given to charity do not qualify as QCDs.
  • Your QCD must be completed on or before December 31, 2024, to be counted in the 2024 tax year.

HOW TO SET UP A QUALIFIED CHARITABLE DISTRIBUTION

You must instruct your IRA plan administrator to make a QCD. Some IRA administrators offer their own instruction forms, which often can be found online. The Office of Gift Planning can provide you with the legal names and tax ID numbers you may need to direct your support to any UVA school or area you wish to benefit, or to create a charitable trust or gift annuity.

The Office of Gift Planning can also provide you with sample letters (1) directing your plan administrator to make a QCD to UVA, and (2) notifying UVA of your QCD gift, how you want it to be used, and, if applicable, how you want your gift divided among two or more UVA schools or areas.

Contact giftplanning@virginia.edu

Donor Story

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Gift Planning
We Build Great Beginnings
Jose Lambert’s dream of becoming an architect nearly ended in 1958 when Fidel Castro came to power in Cuba. Families like Lambert’s were no longer allowed to send money to loved ones living in the U.S., and he was forced to leave his studies at the UVA School of Architecture.

The University of Virginia does not provide legal, tax, or financial advice. We strongly recommend that you consult professional advisors on all legal, tax, or financial matters, including gift planning considerations. To ensure compliance with certain IRS requirements, we disclose to you that this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of avoiding tax-related penalties.