Every January, financial advisors get the same call from retirees who just wrote a five-figure check to their favorite charity.
The caller wants to know if they can write it off.
The answer, for many of them, is no — and it has nothing to do with how generous they were.
Since 2018, the standard deduction has been high enough that roughly nine in ten taxpayers take it instead of itemizing.
If you don't itemize, charitable gifts don't reduce your taxable income at all.
There's a workaround that's been sitting in the tax code since 2006, and a lot of people who could use it have never heard of it.
It's called a qualified charitable distribution, or QCD.
If you're 70½ or older, you can send money straight from your IRA to a charity.
The transfer counts toward your required minimum distribution, but it never shows up as income on your return.
Because income is the number that drives everything else in retirement.
It determines how much of your Social Security is taxed.
It can push your Medicare premiums higher through IRMAA surcharges.
It affects whether you owe the net investment income tax.
The limit for 2025 is $108,000 per person, indexed for inflation.
A married couple with two IRAs can each do it, which doubles the ceiling.
The money has to go directly from the custodian to the charity — if it touches your checking account first, the whole thing is disqualified.
No charitable deduction on top of the exclusion.
You need to be 70½, not 72, even though required distributions don't start until 73.
The charity has to be a legitimate 501(c)(3), and you can't send it to a donor-advised fund or a private foundation.
You also won't get a receipt the way you would writing a check, so keep the custodian's transaction record.
Retirees who don't itemize, people with large traditional IRAs they don't need for living expenses, and anyone flirting with a Medicare premium surcharge.
If you already itemize heavily and you're in a low bracket, the math is murkier and worth running with an accountant.
Once the money leaves the IRA, it's gone.
This is not a strategy for stretching a tight budget.
The uncomfortable part is how much of this advice is free and how rarely it's delivered.
Custodians don't advertise QCDs aggressively because moving money out of an IRA shrinks the asset base they manage.
Accountants mention it, but usually only if you ask.
Charities love it, obviously, but they can't initiate it for you.
If you're charitably inclined and sitting on a traditional IRA, this is worth a fifteen-minute phone call to your custodian before year-end.
Ask specifically for a qualified charitable distribution, get the exact wording, and confirm the check is made payable to the charity.
The tax code rarely hands out clean wins.
This is one of the few, and it comes with an expiration date each December 31.
Final Thoughts
Waiting until you file your return in April is too late — by then, the year is closed and so is the option.