Community Foundation of Northeast Alabama Blog

Did you know the Community Foundation has 40 Designated funds, 31 Donor-Advised funds, and 13 Field of Interest funds? 

Designated Funds are restricted funds in which the donors specify the fund beneficiaries. Field of Interest funds are funds a community foundation holds for a specific charitable purpose such as education or health and wellbeing. Donor-advised funds are funds for donors, businesses, or organizations that allow cash and non-cash assets to be donated to be used for future giving.

What is Qualified Charitable Distribution (QCD)?

QCDs allow donors who are 70½ years old or older to donate up to $100,000 to one or more charities directly from a taxable IRA instead of taking their required minimum distributions. As a result, donors may avoid being pushed into higher income tax brackets and prevent phaseouts of other tax deductions, though there are some other limitations. One limitation is that a donor-advised fund is not considered a qualifying charity. Therefore, QCDs cannot be added to donor-advised funds.

What is the correlation between fund types and QCDs?

A QCD removes funds from an IRA before donors reach the age-73 threshold for Required Minimum Distributions (RMDs). This can lessen the eventual income tax hit that accompanies RMDs. For RMD-applicable donors, the QCD counts toward their RMD.

BOTH CASES, the QCD transfers do not fall into the donor’s taxable income. Although Donor-advised funds cannot accept QCDs, the community foundation offers other types of funds that can accept QCDs. Field of Interest Funds and Designated Funds held at the community foundation are ideal recipients of QCD transfers.

Does this interest you?  Contact Jennifer S. Maddox, MBA, CAP, President & CEO, and discuss your charitable wishes. 256-235-5160, ext. 25.

Learn more about the work we do at cfnea.org