What Is a QCD?: Giving with Your IRA

We know you want to sustain and extend the reach of First Presbyterian Church of Orlando, to leave a legacy that grows the kingdom of God. We also know you want to do so in the most strategic ways possible, so that your resources can make the greatest impact. 

Good news! If you are 70 ½ years of age (or will be soon) and own or have inherited an Individual Retirement Account (IRA), you have a unique opportunity to give an extra tax-savvy gift to a nonprofit organization, called a Qualified Charitable Distribution (QCD). 

How does a QCD allow you to leave an even more impactful legacy? 

When you give a QCD, you’re able to give up to $108,000 from your IRA and exclude that amount from your gross income for tax purposes. If you have a spouse with an IRA, they can also give another $108,000 to an eligible charitable organization, doubling your giving opportunities.

Usually, distributions from your IRA are taxable once you receive them, but when you donate your distribution directly from your IRA to a charitable organization like the Heart of the City Foundation, they are tax-free!

As you may know, IRAs also have a high tax rate compared to other appreciated assets. Therefore, giving from your IRA can also help the beneficiaries of your estate in the long run, relieving them of some of the weight of the tax responsibilities when they inherit your IRA. 

Once your required minimum distributions (RMDs) begin at age 73, these gifts can count towards your RMDs for the year as long as they meet certain qualifications, making them even more helpful financially as a way to give. 

So if you don’t need your RMDs to live on, you can allow them to nurture others in their relationship with God: investing in life-changing discipleship programs at FPCO, pouring resources into Christ-centered missions, maintaining and improving our facilities, and empowering people to pursue higher education and theological training. 

So, how do you give a QCD to the Heart of the City Foundation? 

Here are the steps you will want to take: 

1. Contact your IRA trustee and share with them your desire to set up a QCD. They’ll know what to do. 

2. Let us know of your intent! We’ll need to know the details of your gift ahead of time for security purposes in order to receive it. 

3. When tax season comes around, report it properly. You will receive Form 1099-R from your IRA trustee with your total distributions recorded, and from there, you’ll need to specify what was a QCD and what was a distribution to yourself. You can check out this article to ensure you report it correctly. 

That’s it! 

Now you know how to give a QCD and why it’s an excellent way for you to leave an even more influential legacy with our church. We hope this resource opens up a giving opportunity to you that you might’ve not known about before, one which can help you manage your resources with even more wisdom so that you can feel all the more confident in your giving.