Webinar Replay

Click Here to Download Summary Below

Charitable Giving After the SECURE 2.0 Act: Advanced Planning Strategies for Advisors

This session explored how the SECURE Act and SECURE 2.0 have reshaped charitable giving strategies—particularly for clients with significant IRA assets—and how advisors can use Qualified Charitable Distributions (QCDs), life-income vehicles, and planning conversations to unlock substantial tax and philanthropic benefits.

Rick Peck emphasized that retirement accounts now represent one of the largest pools of wealth available for charitable planning, and that recent legislative changes have created both constraints (e.g., the 10-year rule) and new opportunities (e.g., QCD-funded life income plans). Advisors who understand these tools can help clients reduce taxes, create income streams, and align wealth with purpose.

A central theme throughout the session was that technical strategies alone are insufficient—advisors must proactively uncover client intent, values, and philanthropic goals to apply these tools effectively.

Key Topics and Expanded Insights

1. SECURE Act & SECURE 2.0: Structural Changes Driving Planning Opportunities

Key Takeaways

• The SECURE Act fundamentally altered inherited IRA planning by replacing the “stretch IRA” with a 10-year distribution rule for most non-spouse beneficiaries. 
• Required Minimum Distributions (RMDs) now generally begin at age 73. 
• QCD eligibility remains at age 70½, creating a strategic planning window before RMDs begin. 

Planning Implications

• The loss of the stretch IRA accelerates taxation for heirs, increasing the importance of lifetime planning strategies. 
• QCDs can now serve as a primary tool to reduce IRA balances before death, mitigating future tax burdens on beneficiaries. 

Advisor Insight

• Clients who previously relied on inherited IRA deferral strategies must now pivot toward charitable and tax-efficient distribution strategies during life. 

2. Qualified Charitable Distributions (QCDs): Core Strategy for Tax Efficiency

Key Takeaways

• QCDs allow up to $111,000 per individual annually (indexed for inflation) to be transferred directly from an IRA to charity. 
• QCDs satisfy RMDs but are excluded from taxable income, offering a unique tax advantage. 
• Unlike traditional charitable deductions, QCDs do not require itemizing, making them valuable for the ~90% of taxpayers who take the standard deduction. 

Important Nuances

• QCDs must go directly to a qualified charity (not donor-advised funds or private foundations). 
• They reduce Adjusted Gross Income (AGI), which can: 
  • Lower Medicare IRMAA surcharges 
  • Preserve deductions and credits tied to AGI thresholds 

Case Study Insight

• A couple maximizing QCDs over 20 years saved approximately $1.7 million in taxes while fulfilling philanthropic goals. 

Advisor Takeaways

• Prioritize QCDs for: 
  • Clients who are charitably inclined 
  • Clients with large IRAs and no need for distributions 
  • Clients facing AGI-related tax thresholds 

3. New SECURE 2.0 Opportunity: One-Time QCD Funding of Life Income Plans

Key Takeaways

• SECURE 2.0 introduced a one-time QCD (up to $55,000 per person) to fund: 
  • Charitable Remainder Trusts (CRUTs) 
  • Charitable Remainder Annuity Trusts (CRATs) 
  • Charitable Gift Annuities (CGAs) 

Key Limitations

• Only available once per lifetime
• Income beneficiaries must be the IRA owner and/or spouse 
• No charitable deduction is allowed when funded via QCD 

Planning Insight

• While the $55,000 limit may seem modest relative to setup costs, it represents: 
  • A “foot in the door” strategy 
  • A potential foundation for larger future planning if limits increase 

4. Life Income Vehicles: CGAs, CRUTs, and CRATs

A. Charitable Gift Annuities (CGAs)

Key Features

• Fixed, predictable income stream for life 
• Backed by the issuing charity 
• Payout rates increase with age (e.g., ~5–6% for clients in their 70s) 

Advantages

• Simplicity and predictability 
• No investment risk for the donor (risk borne by issuer) 

Risks / Considerations

• Inflation risk (fixed payments) 
• Credit risk of issuing charity 

B. Charitable Remainder Unitrusts (CRUTs)

Key Features

• Variable payout based on annual asset value (typically ≥5%) 
• Payments can increase with investment performance 

Advantages

• Inflation hedge 
• Potential for higher long-term income 

Risks

• Market volatility 
• Income unpredictability 
• Risk shared between donor and charity 

C. Charitable Remainder Annuity Trusts (CRATs)

Key Features

• Fixed payout (like CGA) 
• Structured as a trust (more flexible than CGA) 

Use Case

• Best suited for fixed-term income needs (e.g., funding college expenses) 

Comparative Insight

• CGAs: most popular for simplicity (often lower dollar amounts) 
• CRUTs: preferred for larger gifts and growth potential 
• CRATs: niche use for defined payout periods 

5. Strategic Role of Retirement Assets in Charitable Planning

Key Takeaways

• Retirement accounts represent nearly 40% of U.S. household assets, exceeding $30 trillion. 
• These assets are often: 
  • Highly taxable 
  • Poor legacy assets for heirs 

Planning Implications

• IRAs are among the most tax-efficient assets to give to charity 
• Non-cash assets (real estate, securities) can also be used in advanced strategies 

Advisor Insight

• Reframing retirement accounts as “charitable assets” rather than inheritance assets can unlock better outcomes. 

6. Advisor-Led Discovery: The Missing Link in Charitable Planning

Key Takeaways

• Technical strategies are ineffective without understanding client intent 
• Advisors should ask: 
  • What causes matter most? 
  • How do you currently give (time, money, connections)? 
  • Do your giving patterns reflect your true values? 

The “Five T’s” Framework

• Time 
• Talent 
• Treasure 
• Ties 
• Testimony 

Behavioral Insight

• Up to 85% of charitable giving is reactive (triggered by being asked) rather than strategic 

Advisor Takeaways

• Move clients from reactive giving → intentional planning 
• Integrate philanthropy into financial planning conversations early 

Practical Advisor Takeaways

• Use QCDs as a default strategy for charitably inclined retirees with IRAs 
• Leverage the age 70½–73 window for proactive tax planning 
• Evaluate whether clients benefit more from: 
  • Fixed income (CGA/CRAT) 
  • Growth-oriented income (CRUT) 
• Position IRAs as philanthropic tools, not just retirement vehicles 
• Introduce charitable discussions using structured discovery questions 
• Explore non-cash asset strategies for high-net-worth clients 
• Recognize that behavioral and emotional factors drive giving decisions as much as tax considerations

External Reference Sources

• IRS – Qualified Charitable Distributions
  https://www.irs.gov/retirement-plans/qualified-charitable-distributions 
• IRS – Required Minimum Distributions (RMDs)
  https://www.irs.gov/retirement-plans/plan-participant-employee/required-minimum-distributions  
• IRS – Retirement Plan Distributions and 10-Year Rule
  https://www.irs.gov/publications/p590b 
• SECURE Act Overview (Congress.gov)
  https://www.congress.gov/bill/116th-congress/house-bill/1994
• SECURE 2.0 Act Summary (U.S. Senate Finance Committee)
  https://www.finance.senate.gov/chairmans-news/secure-20-act-section-by-section-summary  
• American Council on Gift Annuities (ACGA Rates)
  https://www.acga-web.org
• National Philanthropic Trust – Charitable Giving Statistics
  https://www.nptrust.org/philanthropic-resources/charitable-giving-statistics
• Fidelity Charitable – QCD Overview
  https://www.fidelitycharitable.org/guidance/charitable-strategies/qualified-charitable-distribution.html