As part of the new tax structure recently put in place by Congress, the standard deduction was significantly increased. This has caused some donors to search for other ways to make charitable impacts while still enjoying a tax benefit.
If you will not be making charitable gifts that exceed your standard deduction, you may gain a significant tax advantage by exploring a Qualified Charitable Distribution (Charitable Rollover) from your IRA.
Here’s how it works… If you are at least 70½ years old and you have an IRA, this may be an option. Each year you are required to take a minimum distribution from your IRA. This can cause other income to be taxed at a higher level.
So, if you don’t need all of the minimum distribution, you can designate a portion of that distribution (up to $100,000 in most cases) to charity. When you do this, the charitable distribution is NOT TAXED as income. In this way, your taxable income is lowered regardless of your standard deduction.
So, how do you make this happen? Simply contact your IRA administrator and they will lead you though the process based on their administrative policies.
This tool can be used to support your parish, school, or archdiocesan ministries. There are some limitations on how you can use a Qualified Charitable Distribution.
Contact 502-585-3291 x116 or mission@archlou.org.
