Your Academy of Nutrition and Dietetics Foundation is the largest charitable organization solely dedicated to nutrition and dietetics. Donations support Foundation scholarships, awards, grants, public nutrition education programs and disaster relief efforts. The Qualified Charitable Distribution (QCD) rule now helps you reduce your Adjusted Gross Income (AGI) by contributing to the Foundation, reducing your taxes and help making an impact with your fellow Academy members.
The QCD rule was made permanent in 2015, allowing traditional IRA owners to exclude their required minimum distributions from their AGI and reduce their taxes if they transferred this amount to a qualified charitable organization.
Any traditional IRA owner or beneficiary who is at least 70.5 years old can use the QCD rule to exempt their required minimum distributions (RMDs) from taxation.
One of the biggest advantages the QCD rule provides is the ability for taxpayers to lower their AGI. This is much more valuable than taking an itemized deduction, which merely lowers taxable income. Because AGI is used for many tax calculations, having a lower number can allow the donor to stay in a lower tax bracket.
The main rule to remember when it comes to QCDs is the distributions must be made directly to the charity, not to the owner or beneficiary. Distribution checks need to be made payable to the charity or it will be counted as a taxable distribution. The owner or beneficiary can receive this check and deliver it to the charity, but he or she cannot deposit the check and make out another one to the charity.
IRA owners who wish to lower their AGI can use the QCD strategy to efficiently disperse money to a charity of their choice. This strategy is superior to taking receipt of the distribution and then donating to charity because the second option will not reduce the donor’s AGI. This rule provides Foundation donors who are IRA owners with a convenient tax deduction for years to come.
We have compiled a fact sheet on how to take advantage of the Charitable IRA Rollover for tax purposes. After 70 and a half years of age, individuals are required to start taking payments from their IRA accounts of up to $100,000 per year. Please remember the Foundation in your year-end financial planning and encourage you to discuss this opportunity with your financial adviser to find out if you qualify for this benefit. If you have any questions about the Foundation’s planned giving program, please contact Susie Burns, by phone at (312) 899-4752 or by email at mailto:firstname.lastname@example.org.