We evaluate whether human induced pluripotent stem cell-derived retinal pigment epithelium (iPSC-RPE) cells can be used to prioritize and functionally characterize causal variants at age-related macular degeneration (AMD) risk loci. We generated iPSC-RPE from six subjects and show that they have morphological and molecular characteristics similar to those of native RPE. We generated RNA-seq, ATAC-seq, and H3K27ac ChIP-seq data and observed high similarity in gene expression and enriched transcription factor motif profiles between iPSC-RPE and human fetal RPE. We performed fine mapping of AMD risk loci by integrating molecular data from the iPSC-RPE, adult retina, and adult RPE, which identified rs943080 as the probable causal variant at VEGFA. We show that rs943080 is associated with altered chromatin accessibility of a distal ATAC-seq peak, decreased overall gene expression of VEGFA, and allele-specific expression of a non-coding transcript. Our study thus provides a potential mechanism underlying the association of the VEGFA locus with AMD.