QCD Tax Savings Calculator (Qualified Charitable Distribution)
Tax saved by giving to charity directly from an IRA as a qualified charitable distribution instead of taking the RMD and donating cash — for donors 70½+ who take the standard deduction, with IRMAA and Social Security effects.
How it works
QCD saving = gift × (federal + state marginal rate) − value of the cash deduction (zero for standard-deduction filers); QCD counts toward the RMD; max $108,000 (2025)
Since the 2017 tax law doubled the standard deduction, most retirees get no tax benefit from charitable gifts — the money comes out of already-taxed income. A qualified charitable distribution fixes that for anyone 70½ or older with an IRA: the custodian sends the gift straight to the charity, it counts toward the required minimum distribution, and it never appears in adjusted gross income. That is worth the full marginal rate on the gift, and because AGI itself is lower, it can also keep you under the Medicare IRMAA cliffs, reduce how much of your Social Security is taxed, and preserve other income-tested benefits. Even itemisers gain from the AGI effect. The limit is $108,000 per person in 2025, and the gift must go to a qualifying public charity, not a donor-advised fund.
Worked example
A 74-year-old with a $30,000 RMD giving $8,000 a year, in the 22% federal and 5% state brackets, taking the standard deduction: a QCD saves about $2,160 a year that a cash gift would not, and lowers AGI by $8,000.
Frequently asked questions
Can I do a QCD from a 401(k)?
No — only from IRAs (traditional, inherited, inactive SEP/SIMPLE). Roll the 401(k) to an IRA first if you want to use QCDs.
I am 71 — do I have an RMD yet?
RMDs start at 73 (75 from 2033), but QCDs are allowed from 70½, so you can give tax-free from the IRA before RMDs begin and shrink future RMDs.
Related calculators
Educational estimate, not financial or tax advice. Rules and thresholds change — confirm current figures with the IRS/HMRC or a qualified adviser before acting.