At 74 She’ll Send $10,000 From Her IRA Straight to Her Church. It Will Count Toward Her RMD, Never Show Up in Her Income, and Beat Any Deduction She Could Have Taken
Most retirees donate to their church every year and walk away with no tax benefit at all, but a little-known IRS provision lets certain IRA owners sidestep that problem entirely by skipping the deduction game altogether.
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Many retirees write a check to their church every year and get no tax deduction. If you’re 70½ or older and have an IRA, a qualified charitable distribution (QCD) can change that. Your IRA custodian sends the gift straight to the charity, the money counts toward your required minimum distribution, and none of it lands in your taxable income.
Why Her Church Checks Get No Tax Break Right Now
Take a single 74-year-old filer. For 2026, her standard deduction is $16,100. She also gets an extra $2,050 for being 65 or older, and a separate senior deduction of up to $6,000 that shrinks once her modified adjusted gross income passes $75,000. Itemizing means listing deductions one by one, and it pays off only when that list beats the standard amount.
For most retirees, the standard amount is larger. Starting in 2026, people who don’t itemize can deduct cash gifts, but only up to $1,000 ($2,000 for married filing jointly). People who itemize can deduct only the portion of their giving above 0.5% of adjusted gross income.
What the Tax Code Lets Her IRA Do
Under 26 U.S.C. § 408(d)(8), the IRA trustee must pay the charity directly, and the donor must be at least age 70½ on the day the money goes out. Most public charities, including churches, qualify. Donor-advised funds and supporting organizations are excluded by law, and so are most private foundations. Traditional and inherited IRAs work. Ongoing SEP and SIMPLE IRAs don’t qualify, and you must first move 401(k) money into an IRA.
The cap started at $100,000 and has been indexed to inflation since 2023. For 2025, it was $108,000 per person. For 2026, the limit is adjusted again for inflation to $111,000. The IRS confirms that a QCD counts toward your required minimum distribution (RMD), the amount the law makes you withdraw each year.
Anyone born from 1951 through 1958 must start RMDs at age 73, and SECURE 2.0 later raises the starting age to 75. QCDs open up years earlier than that, which matters because the RMD rule is only one of several IRS tripwires that quietly pull money out of retirement accounts (we listed nine of them in a free guide here: The Retiree’s Tax Trap Map).
Why Keeping It Out of Income Beats a Deduction
Adjusted gross income (AGI) drives several other costs. Social Security benefits become taxable once half your benefits plus your other income exceeds $25,000 for single filers or $32,000 for joint filers. Medicare’s 2026 Part B premium is $202.90 a month. For income above $109,000 ($218,000 joint), it rises to $284.10. Social Security sets that surcharge based on the most recent federal tax return the IRS provides, generally the return from two years earlier, and each spouse pays it on their own Medicare premium. Medical expenses are deductible only to the extent they exceed 7.5% of AGI. A deduction leaves those figures unchanged. Only an exclusion lowers AGI.
Assume she’s single, doesn’t itemize, and sits in the 22% bracket. If she takes a $10,000 withdrawal and writes the check herself, the full $10,000 goes into AGI, and only $1,000 of it comes back as a deduction. That leaves $9,000 of extra taxable income and about $1,980 in added federal tax. Sent as a QCD, the same gift adds zero to AGI.
Mistakes That Make It Taxable
- Taking the cash first. If she receives the money and donates it afterward, it’s an ordinary taxable withdrawal.
- Bad timing. Money she’s already withdrawn this year can’t be treated as a QCD later. If she took her full RMD in February, a December QCD still keeps the gift out of income, but that February withdrawal stays taxed.
- Getting something back. The entire distribution must qualify as deductible, so a dinner or tickets in return would disqualify it. She also needs the same written acknowledgment from the church that a deduction would require.
- The wrong recipient. A donor-advised fund doesn’t qualify.
- Reporting. Form 1099-R shows the whole amount as a distribution. She reports the total on line 4a, enters zero on line 4b, and checks box 2 on line 4c. She can’t also claim the gift as a charitable deduction.
Two Newer Rules Worth Knowing
SECURE 2.0 added a one-time election to send a QCD to a charitable remainder trust or a charitable gift annuity funded only by QCDs. The base limit is $50,000, indexed for inflation. The 2025 figure was $54,000, and the 2026 figure is adjusted again for inflation. That amount counts toward the annual QCD cap, and a gift annuity must start paying at least 5% within a year. Also, any deductible IRA contributions she makes after 70½ reduce her QCD exclusion dollar for dollar.
Calling the Custodian Before the Year-End Cutoff
She should call her IRA custodian, request its QCD form, and provide the church’s legal name, address, and tax ID. Make the check payable to the church. Ideally, she sets this up early in the year, before any other withdrawal, so the gift covers the RMD first. With about two months left in 2026, she should also ask for the custodian’s December processing deadline, since the money has to leave the account by December 31 to count for this year.
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David Beren has been a Flywheel Publishing contributor since 2022. Writing for 24/7 Wall St. since 2023, David loves to write about topics of all shapes and sizes. As a technology expert, David focuses heavily on consumer electronics brands, automobiles, and general technology. He has previously written for LifeWire, formerly About.com. As a part-time freelance writer, David’s “day job” has been working on and leading social media for multiple Fortune 100 brands. David loves the flexibility of this field and its ability to reach customers exactly where they like to spend their time. Additionally, David previously published his own blog, TmoNews.com, which reached 3 million readers in its first year. In addition to freelance and social media work, David loves to spend time with his family and children and relive the glory days of video game consoles by playing any retro game console he can get his hands on.
