For two decades, the qualified charitable distribution was a niche tool — useful mainly for retirees who couldn't itemize. The One Big Beautiful Bill Act's charitable provisions took effect this year, and they widened that advantage considerably. Anyone over 70½ who gives to charity should re-run the math before December.
The Floor Nobody Priced In
Starting with the 2026 tax year, itemized charitable deductions are subject to a 0.5% of AGI floor. You deduct only the giving that exceeds that threshold. A couple with $200,000 of AGI loses the first $1,000 of their donations. Separately, the value of an itemized charitable deduction is now capped at 35%, even for filers in the 37% bracket.
Non-itemizers got something in return: a universal above-the-line deduction of up to $1,000 (single) or $2,000 (joint) for cash gifts to qualified charities. Donor-advised funds are excluded. Amounts disallowed by the 0.5% floor aren't lost — they carry forward up to five years.
None of this touches the QCD, because a QCD isn't a deduction at all.
Above the Line, Not Below It
A QCD moves money directly from your IRA custodian to a 501(c)(3). The distribution never enters your adjusted gross income. There's nothing to floor, nothing to cap, and no need to itemize.
The 2026 numbers: up to $111,000 per individual, or $222,000 for a married couple where both give from their own IRAs. SECURE 2.0 indexed this cap to inflation in 2024, and it has climbed from $100,000 to $105,000, $108,000, and now $111,000. A one-time election of up to $55,000 can fund a charitable remainder trust or gift annuity.
The eligibility age is 70½ — not 73, the age RMDs begin. That gap is the overlooked part. Charitable gifts made in your early seventies shrink the IRA before required distributions ever start, which lowers every RMD that follows.
Two constraints matter: the transfer must go directly from custodian to charity — withdrawing and then donating disqualifies it — and donor-advised funds, private foundations, and supporting organizations don't count.
Why AGI Is the Number That Matters Now
The new senior deduction makes this concrete. Filers 65 and older get up to $6,000 each ($12,000 per couple) for tax years 2025 through 2028, but it phases out at 6% of MAGI above $75,000 single and $150,000 joint.
Consider a couple, both 72, with $200,000 of income who want to give $20,000. Write the check, and AGI stays at $200,000: the senior deduction shrinks by $3,000, to $9,000, and the 0.5% floor eats the first $1,000 of the gift. Route it as a QCD, and AGI falls to $180,000 — the senior deduction only shrinks to $10,200, and the full $20,000 escapes tax.
That $1,200 of restored deduction is the small win. The $20,000 of AGI suppression is the large one. AGI drives the IRMAA tier that sets your Medicare premium two years out, the share of Social Security that becomes taxable, and most state income tax bills.
Practical Takeaways
- If you're 70½ or older and give to charity at all, default to the QCD — the check now carries a floor the QCD doesn't.
- Instruct the custodian to pay the charity directly; a reimbursement to yourself voids the treatment.
- Use the 70½-to-73 window to shrink the IRA before RMDs begin.
- Verify the recipient is an eligible public charity — DAFs and private foundations are out.
- Request the transfer well before December; custodian processing and check clearing must complete inside the tax year.
- Keep the acknowledgment letter. Custodians report a QCD on Form 1099-R as an ordinary distribution; you and your preparer flag the exclusion on the return.
Sources: IRS – IRS releases tax inflation adjustments for tax year 2026, including amendments from the One, Big, Beautiful Bill (Rev. Proc. 2025-32); Fidelity – Qualified Charitable Distributions (QCDs) and Planning Your IRA Withdrawal; Taft Law – Charitable Giving After the OBBBA: The 2026 Outlook; Regions Bank – 2026 Charitable Deduction Rules: What Changed and Who Benefits; Focus Partners – Using QCDs to Unlock the New Senior Tax Deduction; Kiplinger – How the New $6,000 Senior Bonus Deduction Works; Elliott Davis – What to Know About Qualified Charitable Distributions Under the 2026 Tax Rules