As the calendar moves further into November, year‑end tax planning becomes more urgent. Unlike Roth conversions or tax‑loss harvesting, Required Minimum Distributions (RMDs) and Qualified Charitable Distributions (QCDs) involve custodians, paperwork, and processing timelines. Acting early helps avoid delays and ensures distributions are completed before year‑end.
This blog combines RMDs and QCDs because they work hand in hand, especially for retirees, women navigating widowhood, and anyone looking to reduce taxable income while supporting charitable causes.
1. Calculate Your RMD Early to Avoid Penalties and Delays
RMDs begin at age 73, based on current IRS rules. Missing an RMD triggers a 25% penalty, reduced to 10% if corrected within two years. The IRS provides the Uniform Lifetime Table used to calculate RMDs based on your prior year’s account balance.
Action steps:
Use your prior year’s December 31 IRA balance and the IRS Uniform Lifetime Table.
If 2026 is your first RMD year, remember you can delay until April 1 — but that stacks two RMDs into one tax year.
Contact your custodian early to confirm your RMD amount and distribution method.
Avoid late‑December processing bottlenecks.
2. Turn Your RMD Into a Gift: Using Qualified Charitable Distributions
A Qualified Charitable Distribution (QCD) allows you to send up to $111,000 per person directly from your IRA to a qualified charity in 2026. The IRS confirms that QCDs count toward your RMD but do not increase your taxable income, which can help:
Reduce the taxable portion of Social Security
Support charities you care about
Simplify your tax return if you don’t itemize
Action steps:
Confirm you are age 70½ or older.
Ask your custodian to send the distribution directly to the charity.
Request a written acknowledgment from the charity.
Complete the QCD by December 31.
3. Combine RMDs and QCDs for Maximum Tax Efficiency
Many retirees choose to satisfy their entire RMD through QCDs. This approach is especially helpful for:
Women experiencing widowhood
Business owners transitioning into retirement
Households with large pre‑tax IRA balances
Anyone who wants to give meaningfully without increasing their tax bill
Handle RMDs and QCDs Before the Holiday Rush
RMDs and QCDs are time‑sensitive and best completed before December. Acting early helps you avoid penalties, reduce taxable income, and support causes you care about.
If you want help calculating your RMD or exploring QCD options, schedule a conversation with Longview Insurance and Investments.
Sources
- Internal Revenue Service. “Required Minimum Distributions (RMDs).” irs.gov.
- Internal Revenue Service. “Charitable Distributions from IRAs.” irs.gov.
- Social Security Administration. “Medicare Premiums: Rules for Higher-Income Beneficiaries.” ssa.gov.