Annually, individuals 70.5 and older can transfer up to $100,000 as a Qualified Charitable Distribution (QCD) from their traditional IRA* to a qualified charity such as ESCAPE Family Resource Center. Following the rules for a QCD, you must transfer directly from your IRA to ESCAPE Family Resource Center in order for your gift to qualify as a tax-free- transfer.
Please work with your tax advisor to determine if this program can work for you and ESCAPE Family Resource Center.
*Please note the requirements are different with a Roth IRA
*What is a qualified charitable distribution?
Generally, a qualified charitable distribution is an otherwise taxable distribution from an IRA (other than an ongoing SEP or SIMPLE IRA) owned by an individual who is age 70½ or over that is paid directly from the IRA to a qualified charity. Distributions from Individual Retirement Arrangements (IRAs)) for additional information.
Can a qualified charitable distribution satisfy my required minimum distribution from an IRA?
Yes, your qualified charitable distributions can satisfy all or part the amount of your required minimum distribution from your IRA. For example, if your 2014 required minimum distribution was $10,000, and you made a $5,000 qualified charitable distribution for 2014, you would have had to withdraw another $5,000 to satisfy your 2014 required minimum distribution.
How are qualified charitable distributions reported on Form 1099-R?
Charitable distributions are reported on Form 1099-R for the calendar year the distribution is made.
How do I report a qualified charitable distribution on my income tax return?
To report a qualified charitable distribution on your Form 1040 tax return, you generally report the full amount of the charitable distribution on the line for IRA distributions. On the line for the taxable amount, enter zero if the full amount was a qualified charitable distribution. Enter “QCD” next to this line. See the Form 1040 instructions for additional information.
A Kiplinger article elaborates:
People older than 70½ can transfer up to $100,000 per year from their traditional IRAs to charity, which can count as their required minimum distribution but is not taxable if they follow the rules for a qualified charitable distribution (QCD). (This doesn’t apply to a Roth IRA, which has tax-free withdrawals and no required distributions.) The gift stays out of your adjusted gross income only if you make a direct transfer from your IRA to the charity. It doesn’t count as a tax-free transfer if you withdraw the money first and then make a donation to the charity.