As you may already know, the IRS requires everyone to take a Required Minimum Distribution from their qualified retirement accounts at 70-1/2.
To lessen the impact of these distributions on your taxable income, you can take advantage of charitable IRA rollover to make a meaningful gift to the Companions of St. Anthony.
At 70-1/2 or older, you can transfer up to $100,000 a year from your IRA to a qualified charity. If your spouse has a separate IRA, he/she can also make charitable IRA rollover gift. The amount of the transfer will not be included in your taxable income and the transfer amount can count toward the IRA’s required minimum distribution.
For an individual with a traditional IRA, with a required minimum distribution of $30,000, such a distribution would be taxable at a marginal tax rate of 35 percent. Using a charitable IRA rollover, however, this person could instruct his or her plan administrator to transfer $30,000 to the Companions of St. Anthony, and the $30,000 will no longer be included in his or her taxable income. This individual could also choose to direct a portion of the required minimum distribution, or a greater amount, not to exceed $100,000, to the Companions.
IS THE CHARITABLE IRA ROLLOVER FOR YOU?
The charitable IRA rollover may be particularly appealing if:
• You want to make an outright gift to the Companions of St. Anthony that will have an immediate impact.
• You have a required minimum distribution, but do not need additional taxable income. A charitable IRA rollover can satisfy the requirement with a direct transfer.
• You have maxed out your charitable income tax deductions. An IRA distribution operates separately from tax rules that limit the tax benefit of individual charitable giving.
• You do not itemize your income tax deductions. If your IRA distribution goes directly to the Companions of St. Anthony, the amount of your distribution is never considered taxable income to you in the first place.
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