This year marks a milestone most donors, and more than a few fundraisers, probably missed: the 20th anniversary of the Pension Protection Act (PPA) of 2006. Signed into law on August 17, 2006, the PPA was written to shore up corporate pension funding and reform retirement savings accounts like 401(k)s. But tucked inside was a provision that would go on to reshape charitable giving: the IRA charitable rollover, better known today as the qualified charitable distribution (QCD).
Twenty years later, qualified charitable distributions are one of the fastest-growing ways donors support the causes they care about. Yet many nonprofits still aren’t talking about them nearly enough. As we mark this anniversary, it’s a good moment to look at where QCDs came from, how the rules have changed, and what you can do right now to help more of your donors discover this tax-smart way to give.
What Is a Qualified Charitable Distribution?
A qualified charitable distribution (QCD) is a direct, tax-exempt transfer of funds from an individual retirement account (IRA) to an eligible charitable organization. Donors must be at least 70½ years old.
- Individuals can contribute up to $111,000 annually in 2026, with the limit indexed for inflation.
- Donors can give in one lump sum or smaller amounts throughout the year.
- Funds must transfer directly from the IRA to the eligible charity.
- For donors who are required to take required minimum distributions (RMDs), a QCD can count toward their RMD.
From Emergency Fix to Permanent Giving Tool
While the PPA introduced the IRA charitable rollover to donors, financial advisors, and fundraisers for the first time, it was enacted as a temporary measure set to expire at the end of 2007.
Congress repeatedly extended the charitable IRA rollover through various emergency and tax-relief packages. Financial advisors and donors faced persistent uncertainty late in each calendar year, never quite sure whether the rollover provision would remain active for the next tax cycle.
It wasn’t until 2015 that the Protecting Americans from Tax Hikes Act finally made the IRA charitable rollover permanent, ending the cycle of temporary congressional extensions.
The SECURE Acts of 2019 and 2022 built on that permanence with two more changes fundraisers and donors should be aware of:
- The “stretch IRA” was eliminated for most non-spouse beneficiaries, replaced by a 10-year withdrawal rule, making IRA assets potentially more attractive for charitable giving.
- The $100,000 annual limit on QCDs was indexed for inflation beginning in 2024, and a limited one-time rollover to split-interest entities, such as charitable gift annuities, was permitted. In 2026, the annual QCD limit is $111,000 per individual. Married couples may be able to make up to $222,000 in combined QCDs if each spouse makes a qualifying QCD from their own IRA.
A Growing Opportunity for Nonprofits
A recent FreeWill study found that QCD gifts increased by 56% in 2024 and by another 47% in 2025. That growth isn’t limited to the ultra-wealthy, either: gifts under $1,000 increased by 840%, and gifts between $1,000 and $5,000 increased by 975%, with an average gift size of $4,000 in 2025.
FreeWill’s research points to what it calls an opportunity gap: the pool of eligible donors is growing, but actual participation remains low. That’s unrealized funding your organization can pursue simply by changing how you talk about non-cash assets like QCDs.
How to Encourage QCD Gifts This Year-End
The most effective way to encourage your donors to consider a QCD is to be proactive in your outreach, keeping the focus on potential tax benefits and mission impact rather than complex tax rules.
- Provide Easy-to-Understand Information. Make the QCD information on your website easy to read and understand. Provide step-by-step instructions for making a gift, and include sample documents donors can download and use to request a gift from their IRA custodian.
- Leverage Social Proof. Include donor stories sharing why they chose to make a QCD gift. Feature advisor testimonials about why they encourage clients to consider QCDs as a tax-smart strategy. People are more likely to consider an option when they see others using it.
- Use Targeted Mailings. Can you identify donors in your database who are over 70? If not, consider mailing to all your planned giving prospects, your most consistent or long-term donors, or former board members and current or former volunteers. In whatever way you can, identify those who may be most likely to consider a QCD gift. Have the letter written by, and sent from, a donor who has made a QCD gift.
- Send a Dedicated Email. If possible, segment your email list to include donors over 70. If not, it’s still worth educating everyone about how they can give from their IRA. Focus on impact, not technical jargon, and use a warm, clever subject line to capture attention.
While year-end is a natural time to highlight QCDs, don’t save the conversation for December. Regular promotion matters, so work smart by integrating giving options like QCDs into your marketing and communications year-round through newsletters, social media, and your website.
RELATED: Explore charitable bequests.
Why QCDs Matter for Charitable Giving
Twenty years ago, a law aimed at fixing pension funding rules quietly created one of the most donor-friendly giving tools available today. A qualified charitable distribution allows eligible donors to make a charitable gift directly from an IRA without including the qualifying distribution in taxable income. The QCD has evolved from a temporary measure into a permanent and growing part of the charitable giving landscape, and the donors who stand to benefit most from it are likely already in your database.
This anniversary is a good time to ask: Is your organization making it easy for donors to give via a QCD? A clear webpage, a well-timed mailing, or a single conversation with a longtime donor about their IRA might be all it takes to turn a good intention into a completed gift.
The opportunity is not just to tell donors that QCDs exist. It’s to make this giving option visible, understandable, and easy to act on.
Have questions about qualified charitable distributions or how to incorporate QCDs into your fundraising strategy? Connect with Maureen Mahoney Hill, CFRE, at maureen@advancementadvisorsgroup.com.
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Maureen Mahoney Hill, CFRE, is the founder and principal of Advancement Advisors, a consulting firm dedicated to helping nonprofits strengthen their fundraising efforts.