Charitable IRA Rollover FAQs

Charitable IRA Rollovers—also known as Qualified Charitable Distributions (QCDs)—are a tax-smart way for individuals aged 70 ½ or older to support Wabash College.

Below are answers to some frequently asked questions. If you need assistance, please contact the Advancement Office at 877-743-4545 or at giving@wabash.edu.

WHAT IS A CHARITABLE IRA ROLLOVER?

A Charitable IRA Rollover, also called a QCD, is a gift made directly from your Individual Retirement Account (IRA) to a qualifying charity such as Wabash College. The funds must be transferred directly from your IRA custodian to Wabash—not withdrawn personally first.

IS A QCD THE SAME THING AS A CHARITABLE IRA ROLLOVER?

Yes. “Qualified Charitable Distribution” (QCD) is the term used in the tax code, but the phrase “Charitable IRA Rollover” is often used interchangeably.

WHAT IS THE MINIMUM AGE FOR MAKING A CHARITABLE IRA ROLLOVER GIFT?

You must be at least 70½ years old on the date of the distribution request.

WHEN AM I REQUIRED TO BEGIN TAKING REQUIRED MINIMUM DISTRUBUTIONS (RMDs)?  

You must take your first Required Minimum Distribution (RMD) for the year in which you turn 73. However, you may delay that first RMD until April 1 of the following year.

HOW DO I CREATE A CHARITABLE GIFT ANNUITY USING A CHARITABLE IRA ROLLOVER? 

Beginning in 2025, federal law allows certain donors age 70½ or older to make a one-time QCD of up to $54,000 from a traditional IRA to fund one or more Charitable Gift Annuities (CGAs).

• Multiple charities may issue CGAs, provided the total combined amount does not exceed $54,000 in that year.
• Once a CGA is created using a QCD, no further CGAs using IRA funds may be established in later years—even if the original $54,000 threshold was not reached.
• Married couples may each contribute up to $54,000 from their respective IRAs—a combined total of up to $108,000—to create a single, jointly payable CGA.

WHAT IS THE TAX TREATMENT FOR CHARITABLE IRA ROLLOVERS?

Because QCD funds are transferred directly from your IRA to a qualified charity, they are not included in your taxable income—and therefore, no charitable income tax deduction applies.

The advantage is that you avoid paying ordinary income tax on the amount distributed. This can be especially beneficial for donors who do not itemize deductions.

Even before RMDs are required, some donors choose to make QCDs as a way to reduce future taxable income once RMDs begin.

Note: If an account owner fails to take an RMD—or if an intended QCD is not completed by year-end—the untaken amount may be subject to a 25% excise tax penalty (may be reduced to 10% if the RMD is taken and an amended tax return is filed within two years). Please consult your tax advisor to determine the best approach for your situation.

WHAT TYPE OF ACKNOWLEDGEMENT WILL I RECEIVE?

Wabash will provide a written acknowledgment of your QCD, confirming the amount and the intended designation of your gift. Because QCDs are not tax-deductible, this acknowledgment will not serve as a conventional charitable receipt.

CAN I USE A ROTH IRA FOR A CHARITABLE IRA ROLLOVER?

Yes, Roth IRAs are eligible. However, since Roth IRA distributions are typically tax-free, using Roth assets for QCDs may not be the most tax-efficient strategy. 正规赌钱软件app encourage you to consult your financial advisor before proceeding.

CAN I MAKE A CHARITABLE IRA ROLLOVER FROM ANOTHER RETIREMENT ACCOUNT?

No. QCDs must come directly from an IRA. However, if you hold assets in a 401(k), 403(b), or other qualified retirement plan, you may be able to roll those funds into an IRA and then make a QCD from that account. Please discuss this process with your financial advisor.

WHAT IS THE MINIMUM AND MAXIMUM GIFT SIZE? 

Gift minimums are set by your IRA custodian.

• In 2025, the maximum annual QCD limit for outright gifts is $108,000 per individual.
• For QCDs used to fund Charitable Gift Annuities (CGAs), the minimum at Wabash is $10,000, and the total maximum for all CGAs across all charities is $54,000 per individual, one time only.
• Married couples may each contribute up to $54,000 from their individual IRAs—a combined $108,000—to establish a single CGA.
• The combined total of all QCDs—outright and CGA-related—may not exceed $108,000 per person in any single tax year.

ARE THERE RESTRICTIONS ON CHARITABLE IRA ROLLOVERS?

Yes. QCDs cannot be used to make gifts for which the donor receives a benefit, such as event tickets or dinner seating.

HOW DO I INITIATE A CHARITABLE IRA ROLLOVER?

1. Contact your IRA custodian. Only IRA custodians can initiate QCD transfers on behalf of account holders.
2. Checks must be issued directly from the custodian payable to Wabash College.
3. If you have IRA check-writing privileges, ensure your check is written by the custodian—not by you personally.
4. Timing is critical:
• A QCD counts toward your RMD only when Wabash receives and deposits the funds by December 31.
• Simply mailing a check by year-end does not qualify if it is not received and processed in time.

Please notify the Advancement Office when initiating a rollover. Occasionally, IRA custodians send checks without the donor’s name or intended designation attached.

ARE THERE SPECIAL FORMS I NEED TO USE?

Most IRA custodians now provide their own forms for QCD requests. If yours does not, visit our IRA Charitable Rollover Instructions page to download a sample instruction letter you can send to your custodian.

Please also inform Wabash when your transfer has been requested so we can help ensure proper crediting.

WHEN SHOULD I INITIATE A QCD REQUEST EACH YEAR? 

QCD requests can be made any time after reaching age 70½. However, because year-end processing times vary, we recommend beginning your transfer by early December to allow sufficient time for funds to be received and deposited before December 31.

CAN MY IRA GIFT SATISFY A PLEDGE OR CREATE AN ENDOWED FUND?

Yes. Your QCD can be used to fulfill a pledge or establish an endowed fund at Wabash. Payment schedules of up to five years may be arranged.

HOW DO I KNOW IF A CHARITABLE IRA ROLLOVER IS RIGHT FOR ME?

A QCD may be ideal if:

• You are 70½ or older and have an IRA.
• You do not itemize deductions on your tax return.
• You do not need some or all of your RMD.
• Your RMD increases the portion of your Social Security income that is taxable.
• You are already giving at your charitable deduction limit but wish to do more.

I HAVE MORE QUESTIONS. WHOM SHOULD I CONTACT?

Please call the Advancement Office at 877-743-4545 or e-mail us at giving@wabash.edu