Qualified Charitable Distribution (QCD)
Individuals age 70½ or older who own a Traditional IRA may make a Qualified Charitable Distribution (QCD) directly from their IRA to a qualified charity. The distributed amount is excluded from taxable income. For 2025, up to $108,000 per person may qualify for this tax-free treatment. If both spouses have their own IRAs, each spouse may use the same annual limit.
IRA Contributions
Under the SECURE Act, the age limit for making IRA contributions has been eliminated. As long as you have earned income, you may continue contributing to an IRA even after retirement.
For 2025, the annual contribution limit is $7,000, with an additional $1,000 catch-up contribution available for individuals age 50 or older.
Contributions to a Roth IRA are not tax-deductible, but qualified withdrawals—including investment earnings—are generally tax-free if IRS requirements are met.
Saver’s Credit
Eligible taxpayers with income below certain thresholds may qualify for the Saver’s Credit by contributing to a retirement account.
For 2025, the maximum credit is:
- Up to $1,000 for single filers
- Up to $2,000 for married couples filing jointly
Income limits for 2025 are:
- Married Filing Jointly: up to $79,000
- Head of Household: up to $59,250
- Single Filers: up to $39,500
To claim the credit, taxpayers must file IRS Form 8880 with their tax return.
Spousal IRA Contributions
If one spouse has earned income and the other does not, the working spouse’s income may be used to fund an IRA or Roth IRA for the non-working spouse. Married couples filing a joint tax return may also qualify for available tax benefits associated with these contributions.
Reduced Penalties for Required Minimum Distributions (RMDs)
The age at which Required Minimum Distributions (RMDs) must begin has increased to 73.
The penalty for failing to take a required distribution has been reduced from 50% to 25%. If the error is corrected within the period specified by the IRS, the penalty may be further reduced to 10%.