Charitable Giving
Posted
on Monday, November 18, 2024
in
Financial Education
As the year winds down, now is a great time to reflect on your financial goals and explore opportunities for strategic giving. Local and national charitable organizations often have their annual campaigns underway at this time, and many of the organizations in our community have unmet needs and goals you may choose to support!
If you are 70½ or older and have an IRA, consider a Qualified Charitable Distribution (QCD) as part of your year-end giving plan.
What Is a QCD?
A QCD is a direct transfer of funds from your IRA to a qualified charity. It allows you to satisfy all or part of your Required Minimum Distribution (RMD) while excluding the donated amount from your taxable income. This can be a particularly effective strategy for reducing your overall tax burden, especially if you no longer itemize deductions.
Why Now?
If you are 73 or older this year, you’re required to take your RMD by December 31 each year to avoid penalties. By using a QCD to satisfy your RMD, you can simultaneously fulfill your charitable giving goals and minimize your tax liability.
Things to Keep in Mind:
- Annual Limit: You can donate up to $105,000 via QCDs in 2024 (per individual).
- Eligible Accounts: QCDs must come directly from an IRA (excluding SEP or SIMPLE IRAs with ongoing contributions) to a charitable organization. You will need to coordinate with your Financial Advisor or Account Custodian to complete a QCD.
- Timing: The funds must leave your account and be received by the charity by December 31 to count for this year.
A Win-Win Opportunity
Strategic charitable giving not only supports the causes you care about but also provides financial benefits. If you have not yet completed your RMD, are considering making a QCD, or have questions about other year-end strategies, United Bank & Trust is here to help. Contact us today to discuss how to maximize your generosity while staying aligned with your financial goals.
Give wisely, save smartly, and make an impact this holiday season!