How to Thank a Donor Who Gave From Their IRA (QCD)

A check arrives in November from a financial company you've never heard of. The memo line says "FBO Margaret Hale." There's no address, no note, and no clue whether Margaret has given before. Someone on your board says, "Oh, that's an IRA gift." Now what?

Here's the direct answer to how you thank a donor who gave from their IRA: find out who they are, send a written acknowledgment that states the date, the amount, and that they received nothing in return, and pair it with a warm, personal thank-you that leaves out "tax-deductible" language. That's what a good qualified charitable distribution thank you letter does. The rest of this guide covers the details, plus why these donors deserve extra attention.

This is general information, not tax or legal advice. Your donor's advisor handles their taxes; your job is the acknowledgment and the relationship.

What is a qualified charitable distribution?

A qualified charitable distribution, or QCD, is a gift sent directly from an IRA to a charity by an IRA owner who is age 70½ or older. The money goes from the IRA custodian straight to you. It never passes through the donor's bank account.

Donors like QCDs for practical reasons. According to the IRS, a QCD isn't deductible as a charitable contribution on Schedule A, but it isn't counted as taxable income either. The annual limit is indexed: it was $108,000 for 2025 and is $111,000 for 2026, per IRS Notice 2025-67. You don't need to know more than that. Your donor's advisor will.

What you do need to know is when these gifts show up. Many older donors make their QCDs late in the year, before December 31, so fall is when a small nonprofit is most likely to see a check from a custodian with an unfamiliar name.

Why do QCD gifts arrive without the donor's address?

Because the check usually comes from the IRA custodian (a brokerage or bank), not from the donor. Custodians send money, not context. A typical QCD check might include:

• The custodian's name and return address.
• The donor's name, sometimes written as "FBO" (for the benefit of) or "IRA of."
• Occasionally an account reference number.

What's often missing is the donor's home address, their email, a note about why they gave, or even a clear sign that this is the same Margaret Hale who has given $100 every spring for nine years. Some custodians mail a separate letter with donor details. Many don't.

That's the real risk with QCDs. Not the tax rules, but the moment getting lost. A gift without an address can't be thanked, and a donor who isn't thanked doesn't know you noticed.

How do you identify and confirm a QCD donor?

Work through these in order. Most of the time step one or two solves it.

1. Search your donor records by name. Check spelling variations and maiden names. Long-time donors often turn up here.
2. Look for a pattern. A gift arriving around the same time of year as a past personal check is a strong clue.
3. Check for a separate letter. Some custodians mail donor details in a second envelope a few days later. Hold the check record open for a week.
4. Call the custodian. The number is on the check. Ask whether they can share the donor's contact information or forward a message. Policies vary.
5. Ask your board and staff. In a small community, someone often knows exactly who Margaret Hale is.

Once you've found the donor, add a note to their record that this gift was a QCD. It changes what the acknowledgment should say, and it tells you something about who they are.

What should a QCD acknowledgment include?

The IRS says that, even though QCDs aren't deductible on Schedule A, the donor still needs a written acknowledgment from you before filing their return. Per the IRS, it should:

• State the date of the contribution.
• State the amount of the contribution.
• Indicate whether the donor received anything of value in return.

That's the core. Include your organization's legal name, and it's good practice to note the gift was received from their IRA custodian.

One thing to leave out: don't call a QCD "tax-deductible." It isn't deductible in the usual sense, and a phrase that suggests otherwise could confuse your donor or their advisor. A plain statement that no goods or services were provided does the job. If you're unsure how your general receipts handle this, our guide to what a donation receipt must include covers the broader rules.

A sample QCD acknowledgment and thank-you letter

The acknowledgment and the thank-you can live in the same letter. The first paragraph does the warm work; the paragraph near the end does the paperwork.

Dear Margaret,

Thank you. Your gift arrived this week, and I wanted you to hear from me personally. It's going straight to our after-school reading program, where 31 kids are working with tutors this fall. Several of them started the year reading below grade level. Your gift helps make sure they don't stay there.

I'll write again in the spring to tell you how the year is going.

With gratitude,

Maria Lopez, Executive Director

For your records: Riverside Literacy Project received a qualified charitable distribution of $1,500 from your IRA custodian, Northpoint Financial, on November 12, 2026. No goods or services were provided in exchange for this gift.

Notice what it does. It names the program. It gives one concrete detail. It promises a follow-up, then keeps the official language short and clearly separated. Everything in how to write a donor thank-you letter applies here too.

Why QCD donors deserve extra attention

Think about who makes a QCD. They're 70½ or older, they have an IRA, and they chose your organization for a planned, deliberate gift. QCD donors are very often long-time supporters, people who have given quietly for years.

That makes them some of the most valuable people on your list, and some of the easiest to under-thank. Their gift arrives through a third party, without a note, at the busiest time of year. If the thank-you is slow or generic, it reads like a transaction, which is the opposite of what a decade of loyalty deserves.

A few habits help:

• Thank them fast. Within a couple of days of identifying them. Here's why speed matters so much.
• Pick up the phone if you can. A short call from the ED or a board member lands well with donors who have given for years.
• Note the anniversary of their giving. If they've been with you a long time, say so. "You've supported us for nine years" is a remarkable sentence to receive.

What should QCD donors hear after the thank-you?

Progress. A few months after the gift, send a short note about what happened, with no ask attached. For a QCD donor, that note is what turns a once-a-year transfer into a relationship.

Keep it to three to five sentences: one number or story, tied to what their gift supported. If they give again next fall, the note before that QCD season is the one that keeps you top of mind. Our guide to showing donors their impact has formats and examples.

Where Perennial fits

Perennial Giving tracks every gift you import, including notes like "QCD" or "IRA gift," and flags who needs a thank-you, then drafts it in your voice for you to approve. It also notices long-time donors' giving anniversaries and reminds you to send a progress note months after the gift, which is exactly the follow-up QCD donors rarely get. A careful spreadsheet and a calendar reminder can do the same job. The point is that the gift doesn't get lost.

One check, one relationship

A QCD check from an unfamiliar custodian can feel like paperwork. It's usually a loyal donor making a thoughtful gift in the most tax-sensible way they know. Find them, acknowledge the gift accurately, thank them like a person, and tell them later what it did. That's how a fall check becomes next year's gift too.