A QCD routes IRA funds directly to charity, excluding the full $60,377 RMD from taxable income and cutting a $10,166 federal tax bill to roughly $1,000. A 401(k) must be rolled into a traditional IRA ...
For retirees facing Required Minimum Distributions (RMDs), the Qualified Charitable Distribution (QCD) isn't just a "definition"— it can be one of the most powerful tax planning tools in your arsenal.
A charitably inclined 73-year-old single retiree with $1.6 million in a traditional 401(k), $300,000 in a Roth IRA, and $30,000 a year in Social Security just hit her first required-distribution year.