Tax season may be in full swing, but now is the perfect time to plan ahead and maximize your giving for this year. A Qualified Charitable Distribution (QCD) allows individuals 70½ or older to donate tax-free from their IRAs to eligible funds at the Community Foundation of Anne Arundel County (CFAAC). In 2025, you can direct up to $108,000 to Designated, Field of Interest, Scholarship, or Unrestricted Funds. While Donor Advised Funds (DAFs) are not eligible recipients of QCDs, other types of funds at CFAAC can receive QCDs.

First, ensure you’ve taken your Required Minimum Distribution (RMD) for 2024, if you’re 73 years or older, as missing it can result in penalties. If you intended to make a QCD but missed the RMD deadline, there is good news—you can still file IRS Form 5329 to request a waiver.

Although QCDs can’t be retroactive, making one early in 2025 will help to ensure it counts toward your RMD under the “first dollars out” rule. Acting early also prevents last-minute processing delays.

While you can donate directly to a nonprofit, CFAAC also offers these tax-smart options to make a greater impact:

Contribute Directly to CFAAC:

• Community Leadership Fund: CFAAC’s operating fund that allows us to respond quickly and effectively to our community's most pressing needs and supports our vital work in Anne Arundel County.
• Community Leadership Operating Endowment Fund: The endowment to support CFAAC’s operating fund now and in the future.

Contribute to or Open a Fund at CFAAC (Eligible for QCDs):

• Designated Funds (endowed or non-endowed): A fund designated to benefit one or more nonprofits chosen by the donor.
• Field of Interest Funds: Pooled funds intended to benefit a specific nonprofit interest such as the environment, classroom teaching, children’s health, women and girls. In addition, Field of Interest Funds also offer support for families going through hardship and nonprofits during a community crisis. These funds are awarded through a competitive grant process.
• Scholarship Funds: Funds that support students at any educational level.
• Memorial Fund: Designated Funds established in someone’s memory.
• Nonprofit Agency Funds: Funds established by a nonprofit to support the organization; these funds are often endowments that provide annual distributions to support their operating budget.

Establish a Charitable Gift Annuity (CGA):

Opening a Charitable Gift Annuity (CGA) to benefit CFAAC means you will receive income for the duration of your life. The IRS allows a donor to make a one-time QCD donation of $54,000 for a CGA. The remaining balance will transfer to CFAAC’s Community Leadership Fund (endowed or non-endowed per your choice) at the time of your passing and requires no updating of your estate documents.

The Community Foundation team is always happy to work with you and your professional advisors to help you carry out your charitable goals. Give us a call today at 410.280.1102 or email us at info@cfaac.org.

Download more information about how QCDs are a win-win for you and our community here.