Tax Savings Strategies

With the passage of the Tax Cut and Jobs Act of 2018, many of us are no longer able to itemize on our taxes including contributions to charities like St. Luke’s.

However, if you are 70 ½ years old or older there is a way to not pay taxes on your Required Minimum Distribution (RMD) on your IRA.  If you have a traditional IRA (not a Roth IRA) and you are taking your annual RMD and you are 70 ½ years old, you can set up a Qualified Charitable Distribution (QCD) with the institution that holds your IRA.  You would designate whatever charity/charities as your designee for your QCD.  You can contribute any amount of your RMD to be placed in your QCD up to the maximum of $100,000.  This withdrawal is then treated as tax free since you had it deposited in your QCD.  Your charity will then receive your contributions.  This can be set up for periodic contributions or annual contributions.  If you are interested in reducing your taxable income and you have a traditional IRA and you are over 70 ½ years old, contact the institution that holds your IRA and ask them about setting up a Qualified Charitable Distribution (QCD).