70 1/2 QCD limit since no RMD until 73
I have clients who are over 70 1/2 and want to make QCD’s out of their IRA’s. Since they do not have an RMD until age 73…
Questions:
- what amount are they allowed to give to charities through the QCD since they do not have any RMD?
- is there a dividing factor for them or can the give as much as the want before their RMD starts?
- Is the QCD prior to RMD’s still nontaxable (going directly to charities)
Thank you.
Douglas
Permalink Submitted by Alan - IRA critic on Tue, 2024-12-17 15:26
They can make QCDs up to 104,000 in 2024 and 108,000 in 2025. That’s the only limit.
These QCDs are non taxable and will reduce the IRA balance and that will reduce future RMDs once they reach 73 since the IRA balance will be lower.
But once they reach 73, they should be sure to complete their annual QCDs before completing the RMD as that will eliminate taxes on the RMD to the extent of the QCDs. QCDs done after the RMD is completed will not be taxable, but will not reduce RMD taxes for earlier RMDs that were not offset by earlier QCDs.