Tax-Smart Giving: IRA Required Minimum Distributions
If you are over age 70.5, you are required to take a portion of your IRA, called a Required Minimum Distribution (RMD), as taxable income each year. Current tax law allows you to gift up to $100,000 of your RMD directly to charity and exclude that amount from your taxable income. This is called a Qualified Charitable Distribution (QCD) and is a generous and effective way to give to St. John the Divine.
If you advise your IRA administrator or financial advisor to direct your QCD to St. John the Divine, it will reduce the taxable amount of your RMD by the amount of the gift – the bigger the gift, the less tax is owed and your adjusted gross income could possibly lower your Medicare Part B and D premiums.