It’s that time of year when we think about the tax benefits of donations! With all these acronyms, it can be hard to know just what people are talking about. We’d like to share a few tips to help you understand these giving options.
Did you know that you must take a required minimum deduction (RMD) from your individual retirement account (IRA)? A qualified charitable distribution (QCD) allows individuals who are 70½ years old or older to donate up to $100,000 which you can exclude from your taxable income.
IRA holders are required to take a certain amount out of their account each year, even if they don’t want or need the funds. To avoid pushing an account holder into a higher income tax bracket, the account holder can make a charitable donation out of the account. This fulfills the RMD.
“I learned about it through our financial advisor. Given our enduring support for SHIM and after carefully evaluating our financial situation, the qualified charitable distribution (QCD) emerged as a seamless option that wouldn’t burden us with tax concerns. It’s incredibly straightforward and I enthusiastically share this option with everyone!”– Sue Pettigrew, SHIM supporter
An added benefit of QCDs is that they do not count toward the maximum amounts deductible for taxpayers itemizing, allowing donors to give more than $100,000 in total each year. For donors looking to have a greater impact, this allows for large charitable gifts to be made from multiple sources.
Donors can make QCDs all year round, but they are not allowed to receive any personal benefits from the gift. Should you choose to give a QCD to SHIM, be assured that the full amount of your gift would qualify.
We’re grateful to all our donors for ensuring that neighbors in need have a place to turn. If a QCD seems right for you, we encourage you to take advantage of the tax benefits while helping South Hills residents!
Contact Seth Dubin with any questions at sdubin@shimcares.org or 412-854-9120 x109.
