Are you feeling charitable? Do you own a Traditional IRA? Are you over the age of 70 ½?
What if I told you that you could transfer up to $100,000 yearly from your Traditional IRA directly to charity and not pay any tax on that portion of the transfer? Would you believe me?
Good News! You are in luck. The IRS will allow you to transfer your RMD directly from your IRA to an eligible charity up to $100,000. This will count as your Required Minimum Distribution for the year, and the best part is that you will not pay tax on it. Of course, if you did not pay tax on it, you cannot double-dip by also deducting the donation as an itemized deduction.
Items to consult with your Tax-Advisor:
- Not all charities are eligible
- Some IRA’s are not eligible
- Transfer instructions are specific and strict
- What about a beneficiary of an Inherited IRA?
- What if I have multiple IRA accounts?