Every year around now, the appeals start arriving. Giving Tuesday is November 2, and between now and then your mailbox fills with requests from organizations you actually care about.
If you're 70½ or older and you have an IRA, the way you make those gifts may matter more than the amount.
Because a check and a qualified charitable distribution can deliver the same dollars to the same charity and produce two completely different results on your return.
The problem with the check
Here's what most people never sit down and calculate.
A charitable deduction only helps if you itemize. Since the standard deduction rose, most retirees I meet with in Hillsboro Beach and across South Florida take the standard deduction instead.
Which means the check you wrote in December may produce no federal tax benefit at all. You gave the money. You just didn't get a deduction for it, because you were never itemizing in the first place.
What the QCD does instead
A qualified charitable distribution moves money directly from your IRA to the charity. As long as you're 70½ or older and the transfer runs from the custodian to the charity, that distribution is excluded from your income.
Excluded. Not deducted. That's the entire distinction.
A deduction reduces your taxable income. A QCD reduces your adjusted gross income. And AGI is the number that runs everything downstream:
- Medicare premiums, which are set using income from two years earlier
- How much of your Social Security is taxable
- Whether capital gains stay in the zero percent bracket
- The various thresholds and phaseouts that use AGI as their measuring stick
Lowering AGI is a different and more valuable act than lowering taxable income. It's also why the QCD shows up in nearly every plan I build for a client in required distribution years.
One transfer, two problems
If you're in RMD years anyway, a QCD can count toward the amount you're required to take.
So the money leaves as a distribution you had to take, it satisfies the requirement, and it never appears as income. Compare that to taking the required distribution into your checking account and writing a check afterward, which raises your income, raises the number IRMAA looks at two years from now, and hands you a deduction you may not be able to use.
Same charity. Same dollars. Very different year.
The mechanics people get wrong
Five things worth checking before you do this:
- It has to come from the IRA directly. You cannot take the distribution and then write the check. The transfer runs from custodian to charity.
- It's an IRA move, not a workplace plan move. A 401(k) or 403(b) generally doesn't work unless the money has been rolled to an IRA first.
- No goods or services. You can't use a QCD for a gala ticket or an auction item. The charity has to receive a pure gift.
- The cap is per person. It's indexed, north of $100,000 for 2026, and counted individually rather than per couple.
- Start in early December. December 31 is the deadline, but custodians move slowly in the final two weeks. A transfer requested December 28 may not complete until January.
And get the acknowledgment letter from the charity, stating that no goods or services were received.
What to do this week
Three questions before the appeals stack gets any taller:
- Are you taking the standard deduction? If so, your charitable checks are producing no tax benefit, and that's worth knowing before you write the next one.
- If you're 70½ or older with an IRA, is your giving coming from the right account?
- If you're in an RMD year, are you satisfying it with a distribution that raises your income, or one that doesn't?
The giving season is generous by design. The tax treatment of that generosity is a decision, and it belongs to you rather than to whatever envelope arrives on Thursday.
That's what we do at Tempus Wealth Management. We coordinate the giving, the distributions, and the tax picture so the three aren't fighting each other.
Ready to talk?Schedule a complimentary consultation.
This article is for educational purposes only and does not constitute investment, tax, legal, or insurance advice. Securities and advisory services offered through Cetera Advisors LLC, member FINRA/SIPC. Advisory services offered through Cetera Investment Advisers LLC. Please consult a qualified financial professional regarding your individual circumstances.