Have you heard of qualified charitable deductions (QCDs)? If you haven’t, we’d like to explain how taking advantage of them can save you money and help the pro-life cause.
A QCD is a direct distribution from your IRA custodian to a qualified 501(c)3 charity like the Oregon Right to Life Education Foundation (ORTLEF). Here is simple explanation of the process: Let’s say you’re older than 70 1/2 years old and in a 20 percent tax bracket. You must take $100 out of your IRA to meet the required minimum distributions. You also want to give $75 to ORTLEF.
If you take $100 from your IRA and transfer it directly into your bank account, it is taxed as income. The IRS will take $20. After you give $75 to ORTLEF, you will be left with just $5.
However, if you take advantage of a QCD, you would have your IRA custodian send $75 directly to ORTLEF. The remaining $25 would be sent to you, with the IRS taking 20 percent ($5). You would be left with $20, a savings to you of $15.
There are some requirements and maximum annual amounts your CPA can help you with, but for most retirement age Oregonians, this is an easy way to save money AND help advance the pro-life cause.
We encourage you to consult an attorney or estate planner for up-to-date information. Oregon Right to Life welcomes your questions regarding charitable giving. Please contact our office at 503-463-8563.