Login | November 23, 2025
Can a founder make QCD donations to his own charity?
JULIE JASON
The Discerning Investor
Published: November 20, 2025
We're quickly closing in on the end of the year, which means it's time to make sure that required minimum distributions (RMDs) from tax-deferred accounts are taken care of.
It's also the time to reflect on worthy causes and, with a sense of gratitude, review how you might support them. Put the two thoughts together and you have perfect dance partners: Bringing together charitable causes and RMDs through QCDs (qualified charitable distributions).
While we've talked about QCDs before, the topic continues to generate interest. QCDs can be used to benefit both charity and the IRA owner. If the IRA owner is in RMD stage, he can arrange to pay all or part of the RMD directly to the charity to avoid taxes on the withdrawal. (The maximum QCD for 2025 is $108,000 per IRA owner).
The question I'm addressing today came from "Joe," a 75-year-old individual who actually organized a brand-new public charity that I'll call "ABC Charity." As a public charity, ABC will raise funds from public sources to pay bills. Can the founder also contribute with his own QCD?
Attorney Leonard Calbo, a partner at Connecticut-based Smolin, Calbo, Davidson, and Associates, LLC, said, "I suppose the IRS could disallow it by saying the donor received an inherent benefit since it went to a public charity set up by the donor, but I think that is a stretch."
In these potentially tricky situations, it's wise to go back to basics. For guidance, let's run through what the IRS provides us, starting with IRS Publication 590-B (tinyurl.com/td2dbtdx):
"A QCD is generally a nontaxable distribution made directly by the trustee of your IRA (other than an ongoing SEP or SIMPLE IRA) to an organization ..."
So, the QCD must be made directly by the trustee of the IRA to the organization -- Joe will call his IRA trustee (custodian) to arrange it.
"... eligible to receive tax-deductible contributions." The IRS Tax Exempt Organization Search (tinyurl.com/48y7pz64) allows you to find organizations that have a 501(c)(3) designation, meaning they are eligible to receive tax-deductible contributions. ABC Charity has a 501(c)(3) designation.
"You must be at least age 70 1/2 when the distribution was made." Not a problem, since Joe is 75. If he had not yet reached age 73 (the current age for requiring RMDs for IRA owners) but was older than 70 1/2, he could still make the QCD.
Another requirement? The charity must acknowledge the receipt of the QCD in writing, noting ng the amount received, the date, and that no goods or services were provided in exchange for the donation.
That can be a potential sticking point depending on the circumstances. In IRS Publication 526, "Charitable Contributions" (tinyurl.com/t7et2eyd), is "Contributions From Which You Benefit," which states: "If you receive or expect to receive a financial or economic benefit as a result of making a contribution to a qualified organization, you can't deduct the part of the contribution that represents the value of the benefit you receive."
This would apply if Joe received goods or services in exchange for the QCD. But here, Joe is doing the opposite. He is not only donating money, but also his time and knowledge to further the mission without pay.
Is there some way that a founder benefits beyond the benefit every taxpayer receives when making a QCD (tax savings) just because he is the founder?
Mark Luscombe, principal analyst at Wolters Kluwer Tax & Accounting, believes the answer is "no." "The founder of a charity that is considered a qualified 501(c)(3) charity by the IRS can make a (QCD) to the charity provided that the founder receives no personal benefit from the contributed funds (other than the tax exclusion), the charity is a qualified 501(c)(3) charity, and the transfer was made directly from the IRA administrator to the qualified charity."
Again, be sure to confirm the answer with your accountant or attorney. In and of itself, the fact that the donor is the founder of a public charity does not end the discussion. It all depends on whether there are financial or economic benefits.
On Nov. 5, I'm giving an in-person presentation on QCDs at Greenwich Library. For more information, go to juliejason.com/events/upcoming-events. ** ** **
Seasoned investment counsel (tinyurl.com/52nus8hz) and award-winning columnist and author, Julie Jason, JD, LLM, promotes financial literacy and investor protection. Read her latest book, "The Discerning Investor: Personal Portfolio Management in Retirement for Lawyers (and Their Clients)" (tinyurl.com/4u7h9pjs), published by the American Bar Association. Write to Julie at readers@juliejason.com. While all questions cannot be answered, each email is read and reviewed and can lead to discussion in a future column.
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