Before I worked in ministry marketing, I worked for a self-directed IRA custodian, the company that holds clients’ IRA investments, processes their trades, and helps them take their required minimum distributions (RMD) every year. When RMD season rolled around, clients had choices. Some liquidated assets to take cash out, but others took their distribution “in kind,” handing over shares of stock, gold, even crypto, straight out of the account. Many clients would choose yet another option—I would have clients ask me to send their distribution directly to a nonprofit they cared about instead. Once you understand the dual benefits, it is easy to understand why they would choose this route.
What Donors Need to Know
Once your donors reach a certain age, the IRS requires them to start withdrawing money from their IRA every year, whether they want the income or not. It is called a required minimum distribution (RMD). Under current rules, that begins at age 73 for donors born between 1951 and 1959, and age 75 for anyone born in 1960 or later. Missing the deadline brings a steep IRS penalty, so this is a date on your donors’ calendars whether they like it or not.
Why Clients Chose This, Every Single Year
When a client took their RMD in kind, that distribution counted as taxable income based on its value the day it left the account. They owed taxes on it no matter what they did with the asset afterward.
But when a client sent that same RMD directly to a nonprofit through a Qualified Charitable Distribution (QCD), the math changed completely. The gift still satisfied their RMD for the year, and none of it showed up as taxable income—not a dollar. They did not even need to itemize deductions to get the benefit, which matters more than ever now that most people take the standard deduction. This year, donors 70½ and older can give up to $111,000 this way.
I processed a lot of these requests, and the reason was never just about the tax savings. Yes, it was the cleanest, most tax-efficient way to take money out of an account they were required to touch anyway. But almost every client I talked to lit up a little when they told me who they were giving to and why. They wanted their required distribution to go toward something that actually mattered to them, not just land in a checking account they did not need it in. It was a win for their tax bill, but just as often, it was a win for their heart. Someone just has to give your donors that same option.
Turning This into a Conversation, Not Just a Mailer
You do not need a complicated campaign to make this work. You need good timing and the right list.
- Start in early fall, not December. Custodians need time to process the transfer, and donors who wait until the last week of the year risk missing the deadline.
- Pull your list of donors 70½ and older from your CRM. This is a small, high-value segment. It deserves a personal note, not a line in your newsletter.
- Keep the message simple. Donors do not need a tax lecture, and you are probably not a tax professional either. They need to know the gift comes straight from their IRA custodian, it is not taxable, and you are happy to help them get started.
A short, warm email or letter explaining this option can turn a routine tax requirement into a meaningful act of generosity.
One Detail You Cannot Skip
When you receipt one of these gifts, do not treat it like a normal donation. A QCD is not tax deductible, so your acknowledgment letter should not thank donors for a “tax-deductible contribution.” It should simply confirm the date, the amount, and that no goods or services were exchanged. Getting this wrong can create a real headache for your donor at tax time.
The Bottom Line
In my years on the custodian side, this pattern repeated every single year without fail. That means it is not a one-time opportunity for your ministry. It is a giving season you can plan for annually, right alongside year-end and GivingTuesday. A little proactive communication turns a tax obligation into a gift for your mission.
Disclaimer: This is general information, not tax or legal advice. Encourage your donors to talk with their own advisor, and loop in your organization’s accountant when you set up your QCD process.
If your ministry wants help building this outreach into your fall communications plan, the team at Infinity Concepts is ready to help. CLICK HERE or call us at 724-733-1200.
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