I’m 73, married and file my taxes jointly with my spouse. My IRA is in Vanguard mutual funds. We make about $8,000 annually in contributions to charities. I understand that direct contributions from an IRA to charities can reduce the amount of taxable RMDs.
Do these contributions need to be direct wire transfers from Vanguard to the charity? Or, if the IRA has checking account privileges, could the checks be written to the charity and satisfy the taxable reduction? And does the IRS tax form for RMD withdrawals have a line for this deduction?
– William
William, you are absolutely correct. Disbursements from an IRA that are paid directly to a charitable organization can avoid taxation. These are called qualified charitable distributions (QCDs). Whether you pay them via transfer or check doesn’t matter, as long as you pay them directly to the organization. I’ll explain how those work and how to properly report them on your tax return.
A financial advisor can be a valuable resource, whether you need help managing RMDs or charitable giving. Connect with an advisor for free.
What Is a QCD?
A qualified charitable distribution is a way to send money straight from your IRA to a charity, allowing you to satisfy required minimum distributions (RMDs) while avoiding taxation on the transfer. To qualify as a QCD, the distribution must:
- Come from an IRA: 401(k)s, 403(b)s, and other types of employer-sponsored plans are not eligible for QCDs.
- Be paid directly from the account to the qualified charity: You cannot receive the funds first and then pass them along. Whether you do this by check or electronic transfer doesn’t matter.
- Be made after you reach age 70 ½: Only distributions taken once you’ve reached this age count as QCDs.
- Stay within the annual limit: Total $108,000 or less ($216,000 for a couple) in 2025.
(And if you’re interested in using QCDs or exploring other tax-efficient strategies, speak with a financial advisor.)
Are QCDs Tax Deductible?

Notice that I’ve been saying you “avoid taxation” on QCDs, not that you deduct them. This phrasing is deliberate. That’s because QCDs are not tax-deductible in the technical sense. Instead, you never include them in your taxable income to begin with. This is advantageous, but why?
Charitable contribution deductions generally happen “below the line.” This means they come after you calculate your adjusted gross income (AGI) on line 11 of your Form 1040 tax return. Line 12 then tells you to take either the standard deduction or itemized deductions, which you tabulate on Schedule A.
You would only get the benefit of a charitable deduction if your total itemized deductions exceeded the standard deduction. For 2025, that’s $15,750 for a single filer or $31,500 for a married couple. A slight caveat to this is that the One Big Beautiful Bill Act provides for a limited deduction for those who take the standard deduction ($1,000 single/$2,000 couple). Because your charitable contributions total $8,000, you would need to have more than $23,500 in other deductions to benefit from itemizing.
But since QCDs never enter your income figure to begin with, you can still get the benefit even if you claim the standard deduction.
Also, because they are never added to your income, your AGI would be lower. This has additional benefits beyond the direct tax savings on the donations themselves. Many other tax rules and phaseouts such as the taxation of Social Security, Medicare IRMAA surcharges and other deductions are based on AGI or modified AGI. A lower AGI means you potentially avoid taxation on other income as well.
(Consider working with a financial advisor on your tax strategy. Connect with advisors for free using this matching tool.)
How to Report QCDs Correctly
Like many provisions of the tax code, you need to report QCDs properly to actually receive the tax benefit. Fortunately, the IRS gives us clear and direct instructions for how to do this.
You will receive a Form 1099-R showing all distributions you’ve taken from your IRA. However, this won’t specify what was designated as a QCD. It’s up to you to identify QCDs, which you do on Form 1040 when filing your taxes.
Take the total distribution from Box 1 on your 1099-R and write it on line 4a “IRA distributions” of your 1040. Subtract the dollar amount of QCDs from that number, and put the remaining amount on Line 4b “Taxable amount” and write “QCD” out beside it.
For example, say your 1099-R shows $30,000 in Box 1, and you made $8,000 in QCDs. Write $30,000 on Line 4a and $22,000 on Line 4b along with the letters “QCD.”
(And if you need help filing your taxes in addition to holistic financial advice, find a financial advisor who offers tax preparation services.)
Bottom Line

QCDs can be a great way to maximize the tax benefits of donating to charity. However, it’s important to send the money directly to the organization rather than withdrawing it first. Then, properly record the distribution on your form 1040 when you file your tax return.
Charitable Giving Tips
- If your annual donations aren’t large enough to exceed the standard deduction, try “bunching” several years of contributions into one tax year. This allows you to itemize deductions one year, then take the standard deduction in others.
- A financial advisor can help you find strategic ways to give to charity. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Brandon Renfro, CFP®, is a SmartAsset financial planning columnist and answers reader questions on personal finance and tax topics. Got a question you’d like answered? Email AskAnAdvisor@smartasset.com and your question may be answered in a future column.
Please note that Brandon is not an employee of SmartAsset and is not a participant in SmartAsset AMP. He has been compensated for this article. Some reader-submitted questions are edited for clarity or brevity.
Photo credit: Courtesy of Brandon Renfro, ©iStock.com/zimmytws, ©iStock.com/Prostock-Studio