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What’s a QCD? Use this end-of-year tax-planning strategy to support your favorite station and save on taxes

Sustain the news that sustains you and get a break on your taxes by giving through a qualified charitable distribution (QCD) from your IRA!

If you are at least 70 ½ years of age, you can make all of the above happen in just a few steps. Just have your IRA administrator make a one-time or ongoing qualified charitable distribution, which provides the opportunity to support your favorite public radio station while being tax-smart. A QCD is withdrawn from your IRA by your IRA administrator, and donated to St. Louis Public Radio. Here are the Frequently Asked Questions listeners have about starting a QCD.

Question: What is a QCD?

Answer: A QCD is a distribution taken directly from an IRA fund and donated to a nonprofit organization. A QCD can be made starting at the age of 70 ½.

Question: What are the benefits for me?

Answer: Currently, at age 73, an individual must take a required minimum distribution (RMD) from their IRA, even if they do not need it. However, you can instead make a QCD which will satisfy the RMD, while lowering your taxable income. This can often prevent a donor from being pushed into a higher tax bracket and can reduce RMDs in following years, as a QCD lowers the balance of the IRA.

As an added plus, QCDs are not counted toward the maximum deductible amounts for those who itemize their charitable giving on their taxes. Even for those who do not itemize their giving, a lower adjusted gross income might allow income tax on Social Security benefits and Medicare charges to be lowered. Your QCD will also not be subject to the 50% deduction limits on charitable gifts.

Question: What else do I need to be aware of when making a QCD?

Answer: A QCD can only be made from a qualifying IRA. Qualifying IRAs include: traditional IRAs, Inherited IRAs, Inactive SEP IRA plans, and Inactive SIMPLE IRA plans.

A QCD donation that exceeds the amount of one’s required minimum distribution (RMD) for the year cannot be carried over to the next year to help meet an RMD for the following year, and will only satisfy the RMD for the year the QCD is made. (For instance: if your RMD is $10,000, and you contribute $15,000 you cannot carry over $5,000 to the following year.)

Lastly, your QCD may not be used for something you will gain benefit from such as gala tickets or an auction.

Question: What should I do once my QCD is on the way to STLPR?

Answer: Thank you for your gift! Let your IRA administrator know that you would like your information to be included so it can be attributed to your membership. You can also contact us to let us know your gift is on the way. You can contact Everis Clarke Jr. through email at eclarke@stlpr.org or by phone at 314-516-7481.

Question: How does the Secure 2.0 Act affect IRA giving?

Answer: The Secure 2.0 Act became law in December 2022. It builds on the provisions of the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019, which aimed to improve retirement savings options, so now you can:

  • Give more: Secure 2.0 adjusts for inflation in relation to the $100,000 annual limit on direct gifts to qualified charities from your IRA, which means the annual limit is no longer $100,000.
  • Give now and in the future: Secure 2.0 also allows donors to make a QCD in an amount up to $50,000 to fund either a Charitable Remainder Unitrust, Charitable Annuity Trust, or Charitable Gift Annuity. All of these charitable gift annuities provide tax benefits now and provide a lifetime income for the donor and (if requested) the beneficiary as well. Learn more about gift annuities.

Question: What will my IRA administrator need to make a QCD to STLPR?

Answer: They’ll need our legal name: St. Louis Public Radio; Address: 3651 Olive Street, St. Louis, MO 63108; and federal tax ID: 26-6440629.

Question: I’m not yet 70 but still looking for ways to give through my IRA. What can I do?

Answer: It’s never too early to start planning for the future. In the meantime, consider a beneficiary designation from an IRA, life insurance policies, 401(k), 403(b), or other retirement plans. Speak with an accountant or financial services attorney to determine the best option for you.