If you’re age 70½ or older, you can make a Qualified Charitable Distribution (QCD) from your Traditional IRA or an inherited IRA directly to Children’s Hospital Colorado Foundation, potentially lowering your taxable income.
If you’re age 73 or older, a QCD may also help fulfill your Required Minimum Distribution (RMD), allowing you to make a lasting difference for children and families in our community while meeting your financial requirements.
In 2025, individuals can give up to $108,000 tax-free through a QCD, or for married couples filing jointly up to $216,000.
Smart QCD Giving Strategy
Sarah, age 74, is required to take a $50,000 RMD from her IRA this year. She wants to donate $25,000 to Children’s Hospital Colorado Foundation and use the other $25,000 for her personal needs.
In one scenario, Sarah could take her full RMD of $50,000 as taxable income and donate $25,000 in cash to the Foundation from her personal funds. Assuming she takes the standard deduction on her tax return, she would likely receive no tax benefit for the charitable gift.
With a more tax savvy approach, Sarah could request a QCD to send $25,000 directly from her IRA to the Foundation as a donation and withdraw the remaining $25,000 for personal use — satisfying her RMD.
Since the QCD is excluded from her income, she would only pay tax on the $25,000 she keeps, potentially reducing her taxable income and helping to lower her Medicare premiums and other costs that are calculated on her income.
See the information below for a side-by-side comparison of how these choices may affect her adjusted gross income (AGI), taxable income and overall tax owed.
Comparison: Full RMD + Cash Donation vs. QCD + Partial Withdrawal
|
Scenario 1
Full RMD + Cash Donation |
Scenario 2
QCD + Partial Withdrawal |
|
|---|---|---|
| IRA RMD Distribution | $50,000 | $50,000 |
| Charitable Contribution (QCD) | $25,000 | $25,000 |
| Amount Included in AGI | $50,000 | $25,000 |
| Standard Deduction (2025) | $15,000 | $15,000 |
| Taxable Income | $35,000 | $10,000 |
| Federal Tax | $9,450 | $2,700 |
| Net Tax Owed | $9,450 | $2,700 |
Assumptions: The scenarios provided assume Sarah is age 74 and required to take a $50,000 Required Minimum Distribution (RMD) from a Traditional IRA. A federal income tax rate of 27% is used to reflect a typical effective tax rate for many retirees; actual tax rates will vary based on income level and filing status. The example assumes Sarah is subject to federal income tax only and does not itemize deductions. No state income taxes, Medicare surcharges, Social Security taxation impacts or Net Investment Income Tax are included in these scenarios. These scenarios are for illustrative purposes only and do not reflect every individual’s situation. We strongly recommend consulting with a tax or financial advisor to determine how a QCD fits into your personal retirement, tax planning and charitable giving strategies.
Is a QCD Right for You?
QCDs are available from Traditional, inherited and certain SEP/SIMPLE IRAs (if inactive) but not from 401(k), 403(b) or 457 plans unless plan assets are rolled into an IRA.
If you’re 70½ or older, want to lower your taxable income and/or don’t need all your RMD income, especially if you claim the standard deduction, a QCD could be a smart and efficient way to give. Please consult your financial advisor to see if it’s right for you.
How to Make a QCD Gift?
Contact your IRA administrator
(e.g., Fidelity, Schwab, Vanguard)
Provide these details:
- Legal Name: Children’s Hospital Colorado Foundation
- Mailing Address: P.O. Box 5585, Denver, CO 80217-9142
- Tax ID/EIN: 840813462
- QCD gift amount
- Gift purpose
Notify us of your gift
Letting us know your gift is on the way helps us properly credit and thank you.
Information provided is general and educational in nature and should not be construed as legal, accounting or tax advice. Every taxpayer’s situation is different. Rules and regulations regarding tax deductions for charitable giving vary and laws of a specific state or laws relevant to a particular situation may affect the applicability, accuracy or completeness of the information provided. Please consult an attorney or tax advisor regarding your specific legal or tax situation prior to taking any action based on this information.