Ways to Give
Qualified Charitable Distributions (QCDs)
Utilizing a QCD is a tax-savvy strategy that allows you to transfer up to $100,000 per year from your IRA directly to a qualified charity*. It is only available to IRAs and individuals who have reached the required minimum distributions (RMDs) age of 70.5. Any amount processed as a QCD counts towards your RMD requirement and reduces the taxable amount of your IRA distribution. This lowers both your adjusted gross income and taxable income, resulting in a lower overall tax liability.
*PLEASE NOTE: Donor Advised Funds limit their giving to 501c(3) Charitable Organizations. When recommending a grant to support Marines’ Memorial, please use the Foundation’s EIN number: 45-5261064
Example: A 70+ year-old couple who has an annual RMD between the two of them of $24,000, can instead direct $10,000 of it to charity as a QCD. This reduces their taxable income by $10,000 and are still able claim the same $26,550 standard deduction. In this example, if the couple is in the new 24% tax bracket, they will have saved $2,400 in federal taxes.
The above example demonstrates the benefits to perform a QCD when planning to take the standard deduction in 2018.**
A tax advisor can help you determine if both your IRA and charity qualify for QCDs.
** For a QCD to count towards your current year’s RMD, the funds must come out of your IRA by your RMD deadline, generally December 31.
