Planning
Using QCDs to lower IRMAA
A qualified charitable distribution sends money straight from your IRA to a charity. From age 70½ it can count toward your required minimum distribution while staying out of your adjusted gross income, which lowers your MAGI and can keep you below an IRMAA cliff. Writing a check to the same charity from your bank account does not have that effect.
Why a QCD beats a regular donation for IRMAA
When you take money out of a traditional IRA and then give it to charity, the withdrawal is income first. It lands in adjusted gross income and in MAGI. You may get a charitable deduction later, but only if you itemize, and itemized deductions are subtracted after AGI, so they never reduce MAGI. Most retirees take the standard deduction and get no tax benefit from the gift at all.
A QCD skips the income step. The IRA custodian pays the charity directly, the amount is excluded from your income, and it can satisfy all or part of your RMD for the year. For IRMAA, that is the difference between a donation that raises your Medicare premium and one that lowers it.
The rules that matter
- Age: you must be at least 70½ on the date of the distribution. That is earlier than the RMD age, so QCDs can start before RMDs do.
- Account: traditional IRAs, and inherited IRAs if you are 70½. Not 401(k)s or 403(b)s directly; you would roll money to an IRA first.
- Direct payment: the check must go from the custodian to the charity, or be a check payable to the charity that you deliver.
- Eligible charity: a qualifying public charity. Donor-advised funds and private foundations are not eligible.
- Annual limit: the per-person limit is adjusted for inflation each year; it was $108,000 for 2025. Check irs.gov for the current figure.
- No benefit back: you cannot receive anything in return, such as event tickets, or the whole amount fails.
A worked example
James, from our RMD guide, is single with $70,000 of other income and a $48,780 RMD at age 75, for a MAGI of $118,780. He gives about $15,000 a year to his church and a food bank. Compare two ways of doing it:
| Withdraw, then give | Give as a QCD | |
|---|---|---|
| Other income | $70,000 | $70,000 |
| RMD taken as income | $48,780 | $33,780 |
| Sent directly to charity | $0 | $15,000 |
| MAGI | $118,780 | $103,780 |
| IRMAA tier | Tier 1 | Standard |
| Yearly Part B + Part D surcharge | $3,583.20 | $2,434.80 |
| Room before the next cliff | $18,220 | $5,220 |
The charities receive the same $15,000 either way. Done as a QCD, the gift takes James back under the $109,000 limit and saves $1,148.40 in Medicare premiums two years later, on top of any income tax he saves. Because his headroom after the QCD is only $5,220, he should also keep an eye on December fund distributions in that year.
How to make a QCD
- Ask your IRA custodian for its QCD form or online request. Most large firms offer one.
- Give the charity's legal name, address and tax ID. Confirm it is a public charity and not a donor-advised fund.
- Make the QCD before you take the rest of your RMD for the year, so the first dollars out of the IRA are the charitable ones.
- Get a written acknowledgment from the charity stating you received nothing in return.
- At tax time, check that your Form 1099-R shows the full distribution and report the QCD amount as non-taxable on line 4b, writing "QCD" next to it.
The last step matters. The 1099-R usually does not mark a QCD separately, so if you or your preparer miss it, the gift is taxed as income and your MAGI goes up after all.
Who benefits most
QCDs help most when three things are true: you are 70½ or older, you already give to charity, and your MAGI is close to an IRMAA limit or a tax bracket edge. A retiree giving $3,000 a year who is $2,000 over a cliff can erase the whole tier with a single form. Someone far from any edge still saves income tax but may see no IRMAA change.
QCDs for married couples
The QCD limit applies per person, and each spouse can give only from their own IRA. A couple where both spouses are 70½ can each make QCDs up to the annual limit. On a joint return, every QCD dollar lowers the couple's combined MAGI, and because IRMAA is charged to each spouse on Medicare, keeping a joint return under a cliff saves the surcharge twice. If only one spouse has a large IRA, that spouse makes the QCDs; the other spouse's account cannot be used for them.
Couples who plan to give anyway sometimes shift all of their regular giving to QCDs once one spouse turns 70½, and keep check-writing only for charities that cannot accept them, such as donor-advised funds.
Subtract your planned QCD and see if it moves you below a cliff.
Open the IRMAA calculatorFrequently asked questions
Does a QCD lower MAGI for IRMAA?
Can I make a QCD from my 401(k)?
Can a QCD go to a donor-advised fund?
Do I need to be taking RMDs to use a QCD?
Sources
- IRS Publication 590-B: qualified charitable distributions
- IRS: Qualified charitable distributions
- CMS: 2026 Medicare Parts B premiums and deductibles