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Why Take Your QCD Now

A Qualified Charitable Distribution (QCD), also known as IRA charitable rollover, is still a terrific way to make a tax-free gift to Bryn Mawr College using your traditional IRA. The recent enactment of the “Setting Every Community Up for Retirement Enhancement” Act (or the SECURE Act) includes changes to the rules governing retirement plans that will affect all Americans. Nevertheless, there are still tax-saving reasons to make gifts via your IRA.

How Do I Qualify?

  • You must be 70½ years old or older at the time of the gift.
  • Gifts must come from a traditional IRA account.
  • Gifts must go directly from your IRA to Bryn Mawr College.
  • Gifts cannot exceed $100,000 per donor.

Benefits of a QCD

> The SECURE Act became effective on January 1, 2020 and increased the age at which you must start taking required minimum distributions (RMDs) from 70½ to 72. There are, however, still reasons to consider a QCD at 70½. First, increases in the standard deduction mean far fewer taxpayers can itemize their income tax charitable deductions. If you don’t itemize, a QCD offers all the benefits of an income tax charitable deduction. You can’t claim a deduction for your QCD, but your QCD is not included in your income. The QCD is a tax-free gift.

Another reason to consider a QCD at 70½ is to reduce the balance in your IRA. At age 72 or older your RMD is based on the balance in your IRA at the end of each year, and then multiplied by a factor published by the IRS. You may be in a position where you don’t want or need the income from your IRA. Higher income can increase Medicare premiums and create other tax issues. Consider making QCDs at 70½ to reduce the balance in your IRA. 

If you are interested in making a QCD for Bryn Mawr, contact the Office of Gift Planning.

**NEW LAW: No Required Minimum Distributions in 2020!

As a part of the CARES Act, Congress waived most RMDs from retirement plans during 2020. Check with your financial advisor to see how this might affect you. Even without an RMD, a QCD remains a great way to make tax advantageous contributions. Learn more about ;the CARES Act.

SECURE Act Knowledge Base

Cheryl Holland ’80 is a member of the Bryn Mawr College Board of Trustees and the President and Founder of the wealth management firm Abacus Planning Group. She and her team published the SECURE Act at a Glance to outline the recent changes made by the SECURE Act.