How do I take a qualified charitable distribution (QCD)?
You can sell shares from your Vanguard mutual funds or Vanguard brokerage account by check to donate to a qualified charity. This is called a qualified charitable distribution (QCD). You can take qualified charitable distribution from your IRA.
Why do this?
- You may be able to avoid taxes on otherwise taxable distributions if you're drawing from a traditional IRA.
- A qualified charitable distribution (QCD) is not subject to ordinary federal income taxes – the amount is simply excluded from your taxable income.
- Your annual Required Minimum Distribution (RMD) may be donated to a qualified charity.
When can you do this?
- You must be 70½ at the time of the distribution.
How can you do this?
- Confirm that the receiving charity is qualified under Internal Revenue Code § 170(b)(1)(A).
- You can take a maximum of $100,000 per year in qualified charitable distributions.
- Print this page and then start your distribution by clicking here and following the instructions listed below.
- Choose an eligible account and select Send me a check from the Where’s the money going? drop-down.
- Select the Qualified Charitable Distribution checkbox and read the QCD considerations.
- Enter the name of the charity.
- Proceed through to the confirmation screen.
About taking a qualified charitable distribution for your RMD
- If you are age 70½, up to a maximum of $100,000 of your RMD can be donated to a qualified charity.
- Your QCD counts for your RMD.
- If you have the RMD service, be sure to factor in these donations to avoid distributing more than your annual RMD.
- Qualified charitable distributions are counted for the tax year in which they're taken.