IRA QCD – You are not allowed to receive ANY benefit in return for your charitable donation.
is this true?
You are not allowed to receive any benefit in return for your charitable donation.
For example, if your donation covers your cost of playing in a charitable golf tournament, your gift would not qualify as a QCD.
https://www.fidelity.com/learning-center/personal-finance/retirement/qcds-the-basics
or a tote bag or backstage pass?
so if you make an IRA QCD to a nonprofit, the charity will remove ALL ( not just the dollar allocated) benefits?
example:
https://www.atlantahistorycenter.com/support/membership/
Please refer to this benefits listing prior to making any donations related to a donor-advised fund, a foundation or IRA distribution. Because of the IRS limitations on providing benefits in exchange for contributions from donor-advised fund gifts or qualified charitable distributions from IRAs, AHC WILL WAIVE BENEFITS on your behalf for any gifts of membership received from Donor Advised Funds or made via a qualified charitable distribution from an IRA.
I can see disallowing an assigned value but not effectively requiring the non-profit to exclude benefits to this making a contribution via an IRA QCD.
What am I missing?
And I cannot find the IRC statutory(apparently it is not in the code), regulatory, or Rev Ruling. The IRS publication mentions this with no clarification.
I doubt all charities are doing this.
Has anyone else run into this?
Permalink Submitted by Craig Mullins on Mon, 2023-01-23 17:49
The QCD rule comes from IRC section 408(d)(8)(C), which states, “a distribution to [a charitable] organization…shall be treated as a qualified charitable distribution only if a deduction for the entire distribution would be allowable under section 170 (determined without regard to [section 170(b)] and this paragraph).” So, if you get an item of value, a deduction for the entire distribution would not be allowed, and thus would not be treated as a QCD. Here are a few articles they also shared that discuss/mention the concept. https://www.investmentnews.com/giving-funds-in-iras-to-charity-with-qcds-230118 https://www.cl-law.com/news-events/tax-free-direct-charitable-ira-distributions https://www.raymondjames.com/soundwealthmanagement/pdfs/tax-planning-qualified-charitable-distributions.pdf