Saving on Taxes and Give to Charity

Here is a tip from my favorite CPA, Brent, on a way to save taxes and still donate to your charity.

If you are 70 1/2 and have to take a Required Minimum Distribution, RMD, one way to give to your favorite church/charity is via this RMD.

Have the firm/trustee liquidate a specified dollar amount from your IRA and have them mail/wire the amount directly to the charity.

You will pay no taxes on those withdrawals and still benefit from your standard deduction.

Any amount processed as a QCD, Qualified Charitable Deduction, counts toward your RMD and reduces the amount of your IRA distribution.

You can only make the tax free transfer from an IRA, not a 401(k) or a 403 (b).

 

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