A record number of Americans are reaching retirement—more specifically, age 70½. This important age marks the time when an IRA owner can make a gift directly from a traditional IRA to your organization. These qualified charitable distributions (QCDs) are often larger than cash gifts and provide useful benefits to donors—but many donors are still unaware of this option or don’t realize how easy it is to complete.
Generating more gifts from IRAs starts with outreach and education. Charities that marketed QCDs experienced a 50% higher chance of receiving a gift from an IRA, with consistent marketing—at least three times throughout the year—greatly increasing the likelihood of multiple QCD gifts. If your team is ready to speak to donors about these gifts, consider the following three steps to help with those discussions.
1. Determine which donors are good candidates for IRA gifts.
Consider individuals who:
• own an IRA
• are age 70½ or older (or about to turn age 70½)
• don’t need their required minimum distribution (RMD) and want to avoid paying tax on it
• would like to establish a fixed income stream to supplement other sources of retirement income
• want to make a current or future gift that won’t impact their current cash flow
Look to your donor database to pinpoint individuals who fit these criteria. If your database doesn’t already contain this information, here are a couple of ways to move forward:
• Reach out to all donors age 70 and older.
• Survey supporters to ask about age, IRA ownership, and interest in making these gifts. Donor surveys can be a great way to not only gather information but also educate supporters and inspire gifts.
2. Share the basics and benefits of IRA gifts.
Make sure the appropriate donors understand how easy it is to make a gift from an IRA and exactly how it can benefit them. Touch on the following points:
• Starting at age 73, owners of traditional IRAs are required to take taxable RMDs or pay a significant tax penalty on any amount required but not taken.
• These required distributions increase taxable income, potentially impacting Medicare and Social Security benefits.
• An IRA owner who doesn’t need the RMD to meet current financial needs may be interested in a way to meet the RMD requirement without paying the tax or increasing taxable income—all while meeting charitable goals. (Note that no charitable income tax deduction is available for this gift.)
• A qualified charitable distribution offers a simple solution by allowing the IRA owner to make a tax-free distribution that counts toward their RMD.
• An outright QCD is a gift made directly from the donor’s IRA to your organization. Up to $108,000 (annual aggregate limit for 2025) may be distributed tax free. The donor simply needs to request the distribution from the IRA custodian.
• A one-time life-income QCD is also available. The donor can directly transfer up to $54,000 (in 2025) tax free to fund a new charitable gift annuity (CGA) or charitable remainder trust (CRT)—both of which provide the donor and/or the donor’s spouse with a lifetime income stream. Spouses may combine distributions from their individual IRAs into a joint-life CGA or a single CRT. (This is the only feasible way for donors to use the QCD to fund a CRT since a CRT typically has a minimum of $100,000.) Donors may be particularly interested in the CGA option right now as gift annuity rates remain high.
Remind donors of the future gift option
As part of your discussion about IRA gifts, make sure to mention charitable beneficiary designations. This easy future gift, executed with a simple Change of Beneficiary form, is great for donors who want to leave an important legacy without impacting their current finances and with the flexibility to change the gift if their needs or goals change. For this part of the discussion, make sure to:
• Explain the tax benefits of leaving retirement assets to charity while leaving other types of assets to heirs.
• Encourage donors to let you know if they are planning or have made this type of future gift.
3. Strategically communicate with donors.
Determine the best ways to share your clear message with the donors most likely to make an IRA gift.
• Ensure that your planned giving website includes easy-to-access information on QCDs, including tax benefits and instructions for making these gifts.
• Send out information on IRA gifts at least twice a year. The timing of your messaging is important—consider sending around tax time, at year end, or on the anniversary of a prior QCD.
• Remember that senior donors appreciate face-to-face interactions, legacy giving opportunities, and personalized mail.
Retirement opens up an exciting new chapter in donors’ lives—a chapter that comes with new opportunities for donors to support and invest in meaningful causes. Help those who want to make a difference understand their options so they can select the best ways to maximize giving while saving on taxes. Sharing the advantages of IRA gifts can help your donors engage in powerful, effective giving.
