If you are 70½ years or older you may make a Qualified Charitable Distribution (QCD) from your IRA to your parish, school or other church ministry without paying federal income tax.

The funds transferred will count toward your required minimum distribution. Transferred funds do not qualify for a charitable deduction, but are not counted as taxable income.

Your disbursement must come directly from the administrator of your IRA to the diocese. You cannot receive the funds first.

Assume your required minimum distribution for the year, which you are required to take by December 31 is $25,000.

In November, you make a $25,000 Qualified Charitable Distribution (QCD) to the Diocese of Austin designating your gift to be split with $15,000 going to support your parish, $5,000 to the Catholic Services Appeal and $5,000 to Catholic Charities of Central Texas.

The QCD satisfies your $25,000 Required Minimum Distribution (RMD) for the year. While the $25,000 distribution is generally not tax deductible, your tax benefit comes from excluding the $25,000 from your annual gross income.

For further assistance, please contact Lisa Rosenberger at [email protected] or call (512) 949-2450