QCD Calculator (Qualified Charitable Distribution From an IRA)

A Qualified Charitable Distribution under IRC section 408(d)(8) is money transferred directly from a traditional IRA to a qualifying charity by the custodian. It never touches your bank account and it never enters your adjusted gross income.

That last point is the whole thing, and it is why a QCD is not simply "a tax-efficient way to donate."

A cash gift is a deduction. It only helps to the extent your total itemised deductions clear the standard deduction, and even when it does help, it does nothing at all to AGI.

A QCD is an exclusion. The money never enters AGI, so it helps whether you itemise or not -- which matters enormously, because most retirees take the standard deduction and get precisely nothing from a charitable gift.

And AGI is not a bookkeeping figure for a retiree. It drives the taxation of Social Security under section 86, it drives Medicare IRMAA surcharges two years later, and it drives the medical expense deduction floor. Keeping $20,000 out of AGI is worth more than the federal tax number on this page shows, because none of those second-order effects are modelled here.

The engine computes two complete returns on identical facts and differences the tax.

Step by step:

Step 1 -- Test eligibility. A QCD requires age 70½ or older on the day of the distribution. Below that, no QCD is available and both paths collapse to the cash gift.

Step 2 -- Size the QCD. It is the smallest of three things: the amount you want to give, the distribution it comes out of, and the 2026 annual exclusion limit of $111,000 per individual.

Step 3 -- Identify any donation the QCD could not absorb. Whatever the QCD cannot cover remains an ordinary cash gift, itemisable on the QCD path too.

Step 4 -- Build the QCD path's AGI. Other income plus the part of the distribution that was not routed as a QCD.

Step 5 -- Choose the QCD path's deduction. The larger of the standard deduction and the itemised total (other itemised deductions plus any un-absorbed gift). The excluded QCD amount is deliberately not deductible; you cannot exclude and deduct the same dollar.

Step 6 -- Compute the QCD path's federal tax on the 2026 ordinary schedule.

Step 7 -- Build the cash-gift path's AGI. Other income plus the entire distribution.

Step 8 -- Choose the cash-gift path's deduction. Other itemised deductions plus the whole donation, against the standard deduction.

Step 9 -- Compute the cash-gift path's federal tax.

Step 10 -- Difference the two, and report the AGI kept off the return.

Step 11 -- Apply the QCD against the RMD. A QCD counts toward the required minimum distribution dollar for dollar, capped at the RMD itself.

Using the defaults: age 73, $30,000 IRA distribution, $20,000 gift, $60,000 of other income, $5,000 of other itemised deductions, $25,000 RMD, single filer. The 2026 single standard deduction is $16,100.

Step 1 -- Confirm eligibility. Age 73 is at or above 70½, so a QCD is available.

Step 2 -- Size the QCD. min($20,000 gift, $30,000 distribution, $111,000 limit) = $20,000.00

Step 3 -- Find the donation the QCD could not absorb. $20,000 − $20,000 = $0.00

Step 4 -- Build the QCD path's AGI. $60,000 + ($30,000 − $20,000) = $70,000.00

Step 5 -- Choose the QCD path's deduction. Itemised total is $5,000, below the $16,100 standard deduction, so the standard deduction is taken. $70,000 − $16,100 = $53,900.00 of taxable income

Step 6 -- Compute the QCD path's federal tax. 10% × $12,400 = $1,240.00; 12% × $38,000 = $4,560.00; 22% × $3,500 = $770.00. $1,240.00 + $4,560.00 + $770.00 = $6,570.00

Step 7 -- Build the cash-gift path's AGI. $60,000 + $30,000 = $90,000.00

Step 8 -- Choose the cash-gift path's deduction. $5,000 + $20,000 = $25,000 of itemised deductions, which beats $16,100, so this path itemises. $90,000 − $25,000 = $65,000.00 of taxable income

Step 9 -- Compute the cash-gift path's federal tax. 10% × $12,400 = $1,240.00; 12% × $38,000 = $4,560.00; 22% × $14,600 = $3,212.00. $1,240.00 + $4,560.00 + $3,212.00 = $9,012.00

Step 10 -- Difference the two. $9,012.00 − $6,570.00 = $2,442.00 saved by the QCD

Step 11 -- Read the AGI difference. $90,000 − $70,000 = $20,000.00 of AGI kept off the return, on top of the tax saving.

Step 12 -- Apply the QCD to the RMD. min($20,000, $25,000) = $20,000.00 of the RMD satisfied, leaving $5,000.00 still to take.

Note what happened here. This taxpayer does itemise on the cash-gift route, so the gift is not wasted. The QCD still wins by $2,442, purely because an exclusion beats a deduction of the same size when the deduction merely displaces a standard deduction you were entitled to anyway.

• State income tax. Many states start from federal AGI, which makes the exclusion worth more than shown. Others do not conform. None of it is modelled.
• The taxation of Social Security under section 86. A $20,000 lower AGI can pull benefits back out of taxable income, and that effect is not included in the $2,442.
• Medicare IRMAA. The 2026 income here sets the 2028 Part B and Part D premiums. Staying under a threshold can be worth thousands a year per beneficiary, and none of that is computed on this page.
• The AGI-percentage ceilings on charitable deductions (the 60%, 50% and 30% limits and their carryforwards). The cash-gift path deducts the full gift.
• The medical expense deduction floor, which is a percentage of AGI and therefore moves with it.
• Whether the recipient is a qualifying charity. Donor-advised funds and most private foundations are excluded from QCD treatment. The calculator assumes a qualifying recipient.
• Ongoing SEP and SIMPLE IRAs, which cannot be the source of a QCD.
• Basis in the IRA. QCDs come first out of the otherwise-taxable portion, and the calculator assumes the whole IRA is pre-tax.
• The reduction of the QCD limit for taxpayers who made deductible IRA contributions after age 70½.

• Taking the money first. A QCD must go directly from the custodian to the charity. Withdraw it into your own account and write a cheque, and it is an ordinary distribution plus an ordinary gift, however quickly you do it.
• Confusing 70½ with the RMD age. QCD eligibility starts at 70½. RMDs start later. There are several years in which a QCD is available and no RMD is due, and those are useful years.
• Missing the RMD ordering rule. The first dollars distributed in a year count toward the RMD. If you want a QCD to satisfy it, do the QCD before taking any other distribution.
• Sending it to a donor-advised fund. DAFs do not qualify. Neither do most private foundations or supporting organisations.
• Assuming a cash gift is equivalent because you itemise. On these defaults the taxpayer itemises and the QCD still wins by $2,442.
• Forgetting to tell your tax preparer. The Form 1099-R shows the full distribution. Nothing on it identifies the QCD; you report the taxable amount as reduced and write "QCD" on the return.
• Exceeding the annual limit. Anything above $111,000 for 2026 falls back to being an ordinary distribution plus an itemisable gift.

• IRS Notice 2025-67, https://www.irs.gov/pub/irs-drop/n-25-67.pdf -- "The aggregate amount of qualified charitable distributions that are not includible in gross income under section 408(d)(8)(A) is increased from $108,000 to $111,000," and the split-interest entity election "is increased from $54,000 to $55,000." Fetched and read 2026-08-30.
• IRS, "Retirement plans FAQs regarding IRA distributions (withdrawals)" -- "a qualified charitable distribution is an otherwise taxable distribution from an IRA (other than an ongoing SEP or SIMPLE IRA) owned by an individual who is age 70½ or over." Fetched 2026-08-30.
• IRS, "Seniors can reduce their tax burden by donating to charity through their IRA" -- "A QCD will count toward a required minimum distribution," reported with a taxable amount of zero. Fetched 2026-08-30.
• IRC section 408(d)(8) -- the statutory exclusion, the annual limit, and the split-interest entity election.
• IRS Revenue Procedure 2025-32, https://www.irs.gov/pub/irs-drop/rp-25-32.pdf -- the 2026 ordinary brackets and the $16,100 single standard deduction, held in engine/tables/2026/federal-tax.json.