Retirement Accounts
How does a gift from my retirement account work?

The Not So Good News: If you were at least 70 1/2 years old in 2019, starting this year you must withdraw from your Individual Retirement Account (IRA) a Required Minimum Distribution (RMD)...even if you don’t need or want those funds. And you'll need to make that withdrawal every year going forward.

 

Taking these RMDs will increase your total taxable income, potentially pushing you into a higher income tax bracket. 

 

The Good News: A Qualified Charitable Distribution (QCD) allows you to donate up to $100,000 to the Legion directly from your IRA, instead of taking (and being taxed on) your mandated withdrawal. 

Does a QCD make sense for me?

A QCD can provide several potential benefits. It may be a suitable giving strategy for you if you:

  • Are required to take a minimum distribution from an IRA, but don’t need the funds and would face increased tax liabilities if you took the distribution as income.
     

  • Would like to reduce the balance in your IRA to lower future required minimum distributions.
     

  • Would like to make a larger charitable gift than if you simply donated cash or other assets. The value of charitable gifts that can be deducted from a tax return usually ranges from 20 to 60 percent of a donor’s adjusted gross income. This AGI-based limit does not apply to QCDs, allowing donors to make larger gifts.

How can I learn more about how a QCD from my retirement account can provide mutual gifts to me and the Legion?

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