Changes Ahead for Qualified Charitable Distributions

Thinking about ways to make your giving go further? At Brooklyn Org, we help donors maximize impact through our Donor Advised Fund program, a flexible and accessible vehicle for charitable giving that supports our community year-round. As federal policy continues to evolve, we’re paying close attention to opportunities that may expand giving options for our fundholders.

If you are 70 ½ and older, by now you’ve likely heard about a charitable giving tool called a Qualified Charitable Distribution (“QCD”), allowing you to direct a distribution from your IRA to an eligible charity, such as a Donor Advised Fund or Memorial fund at Brooklyn Org. With a 2025 limit of $108,000 per taxpayer, QCDs count toward required minimum distributions (RMDs) but are excluded from taxable income, which can help you avoid higher tax brackets and phaseouts of deductions.

BKO’s Donor Services team is here to help you make the most of charitable giving tools, including QCDs. A frequently-asked question about QCDs is whether they can be used to add money to a Donor Advised Fund. The answer is no–for now. While most public charities qualify as QCD recipients, Donor Advised Funds, private foundations, and supporting organizations do not under current law. Recently-proposed legislation, however, aims to further expand QCD eligibility by allowing distributions to Donor Advised Funds.

If enacted, this change would give you and other eligible donors even more flexibility in maximizing your philanthropy. Indeed, a Donor Advised Fund is often the “hub” of a family’s charitable giving because it makes it so easy to stay organized and track support to favorite charities over the years. It’s becoming common for a family to add to its charitable giving “portfolio” by establishing a designated fund alongside the Donor Advised Fund, as well as giving to Brooklyn Org’s initiatives through the DAF. In many cases, family members also update their estate plans to include bequests to their funds at Brooklyn Org.

A QCD is a wonderful tool, and we’ll keep our fingers crossed that it becomes even more wonderful. As always, Brooklyn Org’s Donor Services team will keep you posted on this and other tax law changes that may impact your plans for supporting your favorite causes and the community we all love.

Whether you already hold a Donor Advised Fund at Brooklyn Org or are just beginning to explore your giving options, our team is here to support your generosity at every step.