With the new tax reform increasing the standard deduction, many people will no longer find it beneficial to itemize their deductions and therefore not be able to deduct there charitable contributions. However, there is a tax strategy that is available to some of us. The IRA qualified charitable distribution (QCD) provides a way for donors 70 1⁄2 and older to receive a tax benefit for their generosity. It is beneficial regardless of the ability to itemize or not because the QCD will not be included in adjusted gross income and is therefore not subject to tax. A donor can make a QCD of up to $100,000 annually to a charity, and as an added benefit, the QCD satisfies the donor’s required minimum distribution. For more information, you should contact the financial institution holding your IRA’s or 401k plans that are triggering your required minimum distributions.
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