With last spring’s passing of the CARES Act, there has never been a better time to give. The Act provides that charitable contributions up to $300 qualify for an above-the-line tax deduction, even if deductions are not itemized. This charitable tax deduction - $300 per individual or married couple filing jointly - is only offered through December 31st, so if you choose to give, don’t delay.
Ways of Giving - Did you Know?
Are you thinking of making a donation to Central from your IRA this year? Even though the required minimum distribution has been waived for 2020, if you are age 72, or were 70 1/2 before January 1, 2020, you may do so without a withdrawal penalty. Are you aware you can avoid paying income tax on that withdrawal? It may sound too good to be true, but it’s not.
Here’s how - there is a provision within the Internal Revenue code known as the Qualified Charitable Distribution (QCD). If age requirements are met, you can make a gift directly from your traditional IRA account to a qualifying charity. The gift can be up to $100,000, but smaller amounts are also very meaningful. When you make such a gift from your IRA directly to a charity, you do not pay income tax on that withdrawal. However, if you choose to utilize itemized deductions, that QCD contribution cannot be included.
The Stewardship Team hopes you find this information helpful as you consider your giving strategy.