Give Today 
Using Your IRA for the GIFT VIII Match
Are You or Someone You Know 70 1/2 or Older? Use Your IRA for a $2-for-$1 Match!
The Community Foundation of Southern Indiana (CFSI) currently has a $2-for-$1 match available – through Dec. 31, 2025 – for gifts to our Community Impact Fund, which is used to make grants that address the greatest needs and highest priorities of our community. If you’re at least 70 1/2 years old, a great way to support this is by making a Qualified Charitable Distribution, or QCD.
Although you can make a QCD beginning at 70 1/2, when you turn 73 or older, you get “required minimum distributions” (RMDs) paid to you from your IRA account each year. You can’t avoid these distributions, and they increase your taxable income, sometimes in ways that may negatively impact certain tax credits or deductions, including Social Security and Medicare.
The QCD amount can be counted toward satisfying your RMDs for the year, and excludes the amount donated from your taxable income (unlike a regular withdrawal from your IRA).
Answering Questions on Qualified Charitable Distributions
What is a QCD?
A Qualified Charitable Distribution is a direct transfer of funds from your IRA account to a qualified charity. You must be 70 1/2 or older to be eligible. As a reminder, QCDs are not taxable to you.
What If I Don’t Itemize?
Don’t worry! QCDs don’t require it. And due to recent tax law changes, this means that you could choose to take advantage of the higher standard deduction, yet still use a QCD for your charitable giving and not increase your Annual Gross Income (AGI).
Are There Special Requirements?
Yes! Most IRAs are eligible for QCDs (Traditional, Rollover, Inherited, inactive SEP plans, and inactive SIMPLE plans). But you can only do a QCD from your IRA, not from a 401(k), 403(b), or other workplace retirement plans. Roth IRAs can make QCDs, but since they are not subject to RMDs during your lifetime and distributions are generally tax-free, you should consult your tax advisor to see if this option makes sense for you.
Who Can I Give To?
QCDs must be directed to a public charity – but not to a private foundation, supporting organization, or donor advised fund. CFSI is a qualified public charity eligible to accept QCD gifts – and between now and Dec. 31, 2025, every gift to the Community Impact Fund tripled by our $2-for-$1 match!
Are There Any Limitations?
QCDs are limited to the amount that would otherwise be taxed as ordinary income (which means that non-deductible contributions are excluded). The aggregate amount of deductible IRA contributions to your IRA after you turn 70 1/2 will reduce the amount of the QCD not included in your gross income.
What If I’m Still Making IRA Contributions?
There is a complex rule for people who make deductible IRA contributions after age 70 1/2. Basically, these IRA distributions reduce your allowable tax-free QCD amount until they are used up.
Is There A Gift Maximum?
In 2024, the most you can give as a QCD is $105,000.
LEADING BY EXAMPLE: Judge J. Terrence Cody
Retired Circuit Court Judge J. Terrence Cody has always been committed to giving back to his community. Because of his career, he is familiar with the community’s challenges and needs.
After careful consideration, he decided to make a QCD gift to support CFSI’s unrestricted Community Impact Fund in 2024. The fund is designed to address our region’s most pressing needs and highest priorities. And now, thanks to the Lilly Endowment’s $2-for-$1 match, his gift – and its impact – will be tripled.
By contributing to this fund, Judge Cody knows his donation will be used strategically to create the greatest positive change across a variety of areas, such as education, health, economic development, and social services.
Cody’s gift reinforces his commitment to enhancing the quality of life in Southern Indiana. His thoughtful and strategic charitable giving sets an example for others, showcasing how retirement assets can be used to support and strengthen the community for generations.
Tell Me More About This $2-for-$1 Matching Grant
From now through Dec. 31, 2025 (or when all match funds are expended, whichever comes first), you have a rare opportunity to TRIPLE the impact of your charitable dollars with the GIFT VIII’s matching grant. Courtesy of the Lilly Endowment, CFSI has funds available at a $2-for-$1 rate for all gifts made to the Community Impact Fund.
Each year from the unrestricted Community Impact Fund, we award over $400,000 to organizations, projects, and programs that directly benefit Southern Indiana residents. By meeting our matching grant goal, there would be an estimated additional $200,000 in local grant awards – a 50% annual increase
– each year. Forever. Imagine the impact of an estimated $600,000 in grants to our community every year from now on!
IRAs, QCDs, RMDs, oh my! Understanding Giving Scenarios
The following scenarios can be helpful in understanding how donors can make a qualified charitable distribution (QCD) from their individual retirement arrangement (IRA) using some (or all!) of their annual required minimum distribution (RMD). Use Marcia, pictured left, as your guide:
Scenario #1: Marcia makes a QCD using a portion of her annual RMD.
Marcia’s annual RMD = $15,000
Marcia makes a $10,000 QCD to CFSI for match
1. Marcia’s $10,000 is matched $2-for-$1, resulting in a $30,000 addition to Community Impact Fund.
2. Marcia pays no income tax on the QCD.
3. Marcia’s remaining RMD of $5,000 will be included in her taxable income.
Scenario #2: Marcia makes a QCD using her entire annual RMD.
Marcia’s annual RMD = $15,000
Marcia makes a $15,000 QCD to CFSI for match
1. Marcia’s $15,000 is matched $2-for-$1, resulting in a $45,000 addition to Community Impact Fund.
2. Marcia satisfied her full RMD by making a QCD.
3. Marcia’s taxable RMD income is $0, rather than $15,000.
Scenario #3: Marcia makes a QCD using her entire annual RMD, and donates an additional amount to another charity.
Marcia’s annual RMD = $15,000
Marcia makes a $15,000 QCD to CFSI for match. Marcia makes additional $5,000 QCD to another charity.
1. Marcia’s $15,000 is matched $2-for-$1, resulting in a $45,000 addition to Community Impact Fund.
2. Marcia satisfied her full RMD by making a QCD.
3. Marcia’s additional $5,000 gift further reduces her IRA balance, which potentially reduces future RMD amounts. (Note: None of the additional amount made as a QCD can count toward Marcia’s RMDs for future years.)
Disclaimer: The Community Foundation of Southern Indiana is a resource and sounding board as you serve your philanthropic clients. We understand the charitable side of the equation and are happy to serve as a secondary source as you manage the primary relationship with your clients. This newsletter is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice.