With changes to the rules about itemizing deductions in 2018, you may not know how best to support your favorite charitable organization during the holidays. One important strategy to understand is the Required Minimum Distribution (RMD).
If you are 70-and-a-half years old or older, the IRS requires you to start withdrawing from most types of tax-advantaged retirement accounts. You must also take RMDs from retirement accounts you inherit. For most people, the deadline for taking an RMD is December 31. If you miss the deadline or take less than you’re supposed to, you could be subject to a 50% tax penalty.
To avoid this penalty, you can donate your RMD to charity and avoid paying the taxes. Qualified charitable distributions won’t be added to your taxable income for the year, so you may be eligible to save money in taxes by directing part of your RMD to a nonprofit organization. 100% of your gift will benefit the charitable organization you support. You’ll still enjoy tax benefits from your charitable giving, even if you don’t itemize your deductions.
Learn more about RMDs and charitable donations here. We aren’t tax experts, so be sure to consult a financial advisor for questions about your particular situation.
Donate Your Required Minimum Distribution to CASA
If you want to direct a portion of your RMD as a charitable donation to CASA, tell your financial advisor or IRA custodian. CASA’s tax ID is 56-1778714. Distributions can be mailed to:
PO Box 12545
Raleigh, NC 27605