Tax Facts

Charitable Donations in 2019 and your IRA RMD

If you are over 70 1/2 and are required to start or continue taking money as income from your IRA, it is known as an RMD or Required Minimum Distribution. This is the tax law that requires you to start taking at least a minimum amount of money out of your retirement account and start paying taxes on it.

If you are tithing or giving money to charity each year, you may not get a tax deduction for that charitable donation if you no longer exceed the new standard deduction, which has essentially doubled.

Check with your tax advisor and your financial advisor about making your charitable donations directly from your IRA RMD. This way, you will keep that distribution from being taxed. The distribution is now characterized (and coded on the 1099-R tax document) as a Qualified Charitable Distribution or a QCD.

You still get to donate, and you still get a "tax deduction" for it.

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