Long-Time Donors Use QCDs to Give More, Gain More
October 29, 2024
| By La Crosse Community Foundation |
QCDs, or Qualified Charitable Donations, allow Chris Haskell and Bob Carney to give more
After giving to La Crosse Area Community Foundation for more than 20 years, retired educators Bob Carney and Chris Haskell came up with a new way to give that would allow them to have greater financial impact while streamlining their giving.
A friend gave Bob the idea after he and Chris, both retired educators, reached a stage where they were required to take minimum distributions from their IRAs (called Required Minimum Distributions or RMDs). Previously, they had used the RMD income to fund annual contributions to LACF. But taking money out of an IRA, regardless of whether it’s mandatory or directed to charity, is considered a taxable event, so their gifts were reduced to the amount withdrawn after taxes.
The friend mentioned newer provisions to the tax code would allow Bob and Chris to give the full amount withdrawn from their IRAs rather than the net after taxes.
“All we had to do was qualify our IRA withdrawal as a Qualified Charitable Distribution,” said Bob. “It turned out to be a pretty simple process with the guidance of La Crosse Area Community Foundation and our financial institution. Now, our financial institution issues the annual RMD/QCD distribution directly to LACF.”
Why a QCD is a smart way to give
A Qualified Charitable Distribution allows older individuals to avoid income tax on QCDs from their IRA far exceeding most people’s RMD limit. In 2024, anyone over 70½ years of age can make a QCD charitable gift from their IRA up to $105,000 without paying additional tax.
Bob noted that he still receives a 1099 from the IRS noting the amount as income, and it isn’t clear that the distribution was a tax-deductible charitable contribution. He advises other donors to be sure to note the amount was distributed as part of a QCD when filing taxes.
Overall, for donors like Bob and Chris, this method meets IRS requirements and provides a tax-advantaged way to give more generously to the causes they care about.
Why run it through the foundation?
Bob and Chris said they chose to run their QCDs through La Crosse Area Community Foundation because it simplifies the process of distributing their charitable gifts to multiple organizations.
“We really like working with La Crosse Area Community Foundation because we like giving to more local organizations and organizations where we can actually see their work,” said Chris.
Every December, Bob and Chris review a list of potential recipients, prioritizing causes that align with community needs. From supporting LACF and the La Crosse Public Education Foundation to the Parenting Place and La Crosse Jail Ministry, Bob and Chris appreciate the ability to distribute their funds widely and thoughtfully. By running their QCDs through the foundation, they ensure their gifts are not only meaningful but also handled efficiently.
La Crosse Area Community Foundation makes it easy
“The foundation makes it so easy to do,” said Chris. Not only does the foundation handle the IRS requirements, but it also provides both administrative and emotional comfort. “They’re wonderful to work with; the community is extremely lucky to have this organization,” she added.
For Bob and Chris, giving through a QCD allows them to see the tangible impact of their philanthropy while benefiting from a streamlined and tax-efficient giving process. Their support for local causes has grown as a result, and they continue to find joy in helping others.
QCDs at LACF: give more, gain more
“Giving is just what you do. You help other people who need it, and it makes you feel good,” said Bob. “We like to be able to help, and the foundation makes it so easy and comfortable to do. It’s a wise choice.”
Through their thoughtful giving and smart use of QCDs, Bob Carney and Chris Haskell have found a way to make a lasting impact in their community. By leveraging the support of La Crosse Area Community Foundation, they’re able to give more, gain more, and live in a better community as a result.