Did you know you can reduce required minimum distributions from your IRA with charitable distributions?
One strategy to help reduce your taxable income after you start RMDs is to make tax-free qualified charitable distributions (QCDs). You can give up to $100,000 from a Traditional or Roth IRA each year to charity ($200,000 if you file jointly with a spouse) , which counts toward your RMD but isn’t taxable. You must transfer money directly from the IRA to the charity (ask you IRA custodian for their procedure; the money can’t go to a donor-advised fund or private foundation). Even though RMDs start at age 72, you can do QCDs after you turn 70½.
You’ll get a tax benefit from your charitable gift, regardless of whether you itemize or not. The money stays out of your adjusted gross income, so it isn’t included in the income calculation for taxing Social Security benefits or the Medicare high-income surcharge.
“Your qualified charitable distribution gift to SCLT can be especially valuable because you can create a legacy for what you love and the distribution never shows up in your adjusted gross income. It truly is a win-win-win – for our community, for SCLT and for you and your family,” said Executive Director Brad Bauer.
Qualified charitable contributions must be made by December 31 each year in order to exclude that amount from taxable income. Charitable contributions can only be made from IRAs, not 401(k)s or similar types of retirement accounts. So you might need to roll funds over from a 401(k) to an IRA if you want to make tax-free charitable contributions part of your retirement plan.
You can also name Sheridan Community Land Trust as a beneficiary of your IRA, 401K, and other qualified plans. All it takes is contacting your plan provider and requesting a “Change of Beneficiary” form.
To learn more, please contact Brad Bauer at 307-673-4702 or email him below.
Sometimes your retirement account manager does not let SCLT know you made a gift. If you would like to make a gift to SCLT through your retirement account, please email us below. Thank you!
Here is some helpful information you will need to make a gift to SCLT
Organization Name: Sheridan Community Land Trust
Tax ID/EIN: 20-4385635
We are a 501(c)3 organization