What is an RMD?

What is an RMD?

A required minimum distribution (RMD) is a requirement by the IRS for individuals aged 72 and older to withdraw from their IRA. RMDs are subject to income taxes and are included in the IRS’ calculation of taxable income.

This additional taxable income may push you into a higher tax bracket, which can lead to unwanted impacts on things like Social Security income and Medicare benefits. If you don’t take your RMDs by December 31 each year, you could be subject to a 50% penalty on the amount that wasn’t withdrawn.

How can a QCD help?

Qualified charitable distributions (QCD) allow you to instruct your IRA administer to direct your RMD (up to $100,000 per year) to qualified 501(c)(3) charities (donor advised funds do not qualify). Since the IRA distribution is sent directly to the charity through your administrator, the QCD is not reported as taxable income. This is a win-win option for donors who want to support nonprofits in a tax advantaged way!

Making a QCD generally provides greater tax savings than cash donations.

Now that you are thinking about ways to give through your IRA, it’s important that you consider what will happen to your IRA one day. A great option is to designate The Community Foundation or one of our funds, as a beneficiary. Not all assets are treated the same when you pass them to your heirs. Your heirs would pay income taxes on your IRA if you left it to them.

However, The Community Foundation (or any of our funds) would not because we are a public charity. Therefore it’s important to speak with your professional advisor about the smartest ways to meet your goals of caring for your loved ones and supporting the causes and charities you care about most.

Please note that The Community Foundation does not render tax or legal advice. We ask that you consult with your professional advisor about your situation before making a charitable gift.

The Process is Simple

  1. CHOOSE your gift amount and how you would like your gift to be used.
    QCD gifts may be made to support The Community Foundation or one of its programs, like Youth in Philanthropy, the Women and Girls Fund or The Community Fund for emerging and urgent needs.You can also make a gift to any existing Community Foundation scholarship, field of interest, designated or agency fund. (Distributions cannot be to a donor advised fund.)Or ask us about establishing a new charitable fund on your behalf!
  2. ASK your plan administrator to direct your IRA distribution to The Community Foundation.  You may choose a recurring or one-time gift.

Do You Qualify?

  • Donors must be 72 and older on the date of the distribution to a fund at The Community Foundation
  • Your plan administrator must transfer the funds directly to a fund at The Community Foundation.
  • Your gift cannot be directed to a donor advised fund.
  • Distribution must be received by the deadline to be counted in the current tax year. Check with your financial advisor for complete details.
  • Qualified Charitable Distributions are limited to $100,000 in total during each year.


  • All QCD gifts can be used to satisfy your IRA required minimum distribution.
  • Your QCD gift goes directly to The Community Foundation and is not subject to federal income tax.

Sample Letter from Donor to IRA Administrator

Sample Request from Donor/IRA Plan Owner to Administrator for Charitable Distribution from Individual Retirement Account

RE: Request for Charitable Distribution from Individual Retirement Account
Dear Sir or Madam:
Please accept this letter as my request to make a direct charitable distribution from my Individual Retirement Account # ___________ (Account Number).
Please issue a check in the amount of $___________ payable to the organization specified below:
Coral Gables Community Foundation
1825 Ponce de Leon Blvd, Box 447
Coral Gables, FL 33134
Attn: Mary Snow, President & CEO
In your transmittal to the foundation, please indicate my intention to direct this distribution to (select one):