Can QCDs be made to donor-advised funds?
When it comes to tax-smart charitable giving, retirees often look at two tools that stand out: qualified charitable distributions (QCDs) and donor-advised funds (DAFs). Both help you support the causes you care about while maximizing your tax benefits, but they don’t always work the same way. One common question keeps coming up—can a QCD go to a DAF?
This guide explains how QCDs and donor-advised funds work, what the IRS allows, and how you can still use both for a balanced, efficient giving plan.
What is a qualified charitable distribution (QCD)?
A qualified charitable distribution is a direct transfer of funds from your traditional IRA to a qualified charity. For retirees aged 70½ or older, it’s one of the most tax-efficient ways to give.
You can donate up to $100,000 per year directly from your IRA to an eligible charity. That transfer goes toward your required minimum distributions (RMDs) and keeps the amount out of your taxable income, even if you do not itemize deductions.
And since QCDs reduce your adjusted gross income (AGI), they may also mitigate Medicare surcharges or Social Security taxes — making them a savvy move in long-term financial planning.
QCD facts:
- You must be 70½ or older
- The annual limit is $100,000 per person (indexed for inflation)
- It must come from a traditional IRA, not a Roth IRA or simple IRA
- The money must go directly to a qualified 501(c)(3) public charity
Can a QCD be made to a donor-advised fund?
No. A qualified charitable distribution can’t be sent to a donor-advised fund, a private foundation, or certain supporting organizations.
According to the IRS under Internal Revenue Code §408(d)(8)(B)(i), QCDs must go directly to a charity that will use the funds immediately for a charitable purpose. A DAF, however, allows donors to retain advisory privileges and control over distributions, which disqualifies it from QCD eligibility.
If a QCD is accidentally directed to a DAF sponsor, it loses its tax-free treatment and will count as regular income on your tax return, increasing your tax liability and not satisfying your RMD requirement.
Example:
If you direct a $10,000 QCD to a DAF, that amount will be treated as a normal IRA withdrawal, fully taxable as income for the tax year.
💡Pro tip: Always confirm that the recipient is an IRS-qualified public charity, and request confirmation in writing for your records.
How QCDs and donor-advised funds work together
While QCDs can’t be used to fund a DAF directly, you can use both tools side by side for smarter charitable giving.
Use QCDs for:
- Annual charitable contributions directly from your IRA
- Meeting your required minimum distribution (RMD) without raising taxable income
- Supporting nonprofit organizations, churches, and food banks
Use your DAF for:
- Larger or long-term charitable gifts
- Building a fund for future grantmaking
- Donating appreciated assets: real estate or securities, for extra tax advantages
By combining them, you can meet your RMD with a QCD each year, while growing a DAF for strategic giving across your lifetime.
The Secure Act and QCD updates
Under the SECURE Act, the age for RMDs was raised to 73, but QCD eligibility still begins at 70½. You can use QCDs to lower future RMDs by gradually reducing your retirement account balance, which may also reduce future estate taxes.
If you’ve inherited an IRA, a QCD may not apply the same way, so it’s best to check with a CFP or tax professional before making a transfer.
Comparing QCDs and donor-advised funds
QCDs
- Must be paid directly to an eligible charity
- Reduce AGI and income tax
- Count toward RMDs
- No itemized deductions needed
- Limited to $100,000 per taxpayer annually
DAFs
- Open to all ages and income levels
- Offer immediate tax deductions when you contribute
- Funds can grow tax-free and be granted over time
- Backed by a sponsoring organization that handles due diligence
- Ideal for flexible wealth management and estate planning
Smart planning with GoFundMe Giving Funds
You can’t send a QCD directly to your GoFundMe Giving Fund, but it can still play an important role in your financial planning and charitable giving.
Here’s how:
- Donate appreciated assets or cash for tax deductions
- One account to manage all of your giving with one tax receipt.
- Donate to established, validated charitable organizations
- You can begin your grant recommendations online with as little as $5
GoFundMe Giving Funds makes giving easy with tax-efficient options for retirees and working donors who prefer to give on a regular basis or in one organized initiative.
The bottom line
Qualified charitable distributions (QCDs) are one of the most effective ways for retirees to give directly from their retirement accounts while lowering taxable income. Although QCDs can’t fund donor-advised funds, combining the two allows for both immediate tax savings and long-term philanthropy.
Whether you’re managing your required minimum distributions, refining your tax planning, or creating a future giving plan, both QCDs and DAFs can help you support your favorite charities while maintaining financial flexibility.
Your giving can be simple, strategic, and impactful—whether through a QCD, a DAF, or both.
Frequently asked questions
Can I give a QCD to a DAF?
No. The IRS doesn’t permit QCDs to go to donor-advised funds, private foundations, or supporting organizations.
Can I make a QCD and still contribute to my DAF?
Yes. Many taxpayers use both in the same tax year to balance short-term giving and tax efficiency.
What’s the benefit of a QCD over a normal donation?
They reduce AGI, decrease income taxes, and count toward your RMDs — a win for retirees who don’t need all the IRA income.
What’s the difference between a QCD and a DAF contribution?
A QCD provides an exclusion from taxable income, while a DAF contribution gives you a tax deduction.
What if I send my QCD to the wrong organization?
It’s treated as a taxable withdrawal, so double-check that it goes to a qualified charity.
What if I’m not 70½ yet?
Consider donating appreciated assets to your Giving Fund for similar tax benefits.
This content is for educational purposes only and does not constitute tax, legal, or investment advice. Any financial or tax-related calculations provided are illustrative examples only and should not be relied upon for making financial decisions.
Laws and regulations regarding donor-advised funds vary, and tax benefits depend on individual circumstances. Readers should consult with a qualified tax, legal, or financial professional for personalized guidance.