QCD

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Oak&Elm
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QCD

Post by Oak&Elm » Sun Oct 29, 2017 3:44 pm

I inheirited an tIRA from my dad in which he was already taking his RMD. Now I must take the RMD, my question is can I donate this money to my church as a QCD even though I'm only 56 yr old? I was looking at the tax rules and it looks like to do this I must be 70.5 yr old as well, is that how it works? This would be nice if I could donate the funds and lower my taxable income.

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oldcomputerguy
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Re: QCD

Post by oldcomputerguy » Sun Oct 29, 2017 4:15 pm

According to the IRS, you must be at least 70-1/2 in order to do a QCD. But there's nothing stopping you from donating to charity and taking the donation as an itemized deduction.
Anybody know why there's a 20-pound frozen turkey up in the light grid?

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Oak&Elm
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Re: QCD

Post by Oak&Elm » Mon Oct 30, 2017 9:39 am

Thanks for the reply, I guess my question was a bit unclear.
Let's say my RMD is $10,000, if I take the RMD a percentage will go to state and fed taxes leaving me with less than $10k. And yes, I could donate the remainder to charity if I choose. If I have the QCD go directly to the charity it's my understanding no state or fed taxes are taken out so the charity gets $10k, I get to reduce my taxable income by the full $10k and no taxes are taken in this situation. My math is at $10k in a 25% fed and 8% state bracket this could benefit me and/or the charity around $3,300.

Gill
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Re: QCD

Post by Gill » Mon Oct 30, 2017 9:52 am

Oak&Elm wrote:
Mon Oct 30, 2017 9:39 am
Thanks for the reply, I guess my question was a bit unclear.
Let's say my RMD is $10,000, if I take the RMD a percentage will go to state and fed taxes leaving me with less than $10k. And yes, I could donate the remainder to charity if I choose. If I have the QCD go directly to the charity it's my understanding no state or fed taxes are taken out so the charity gets $10k, I get to reduce my taxable income by the full $10k and no taxes are taken in this situation. My math is at $10k in a 25% fed and 8% state bracket this could benefit me and/or the charity around $3,300.
Your thinking is not correct. If you now itemize deductions, and take $10,000 RMD and give it to charity it will have no effect on your taxes. There should be no withholding on the distribution. If, however, you give it through a QCD it has the same result except it also reduces your AGI which could have other consequences. As was outlined above, however, you are too young for a QCD.
Gill

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Sheepdog
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Re: QCD

Post by Sheepdog » Mon Oct 30, 2017 10:10 am

You have correct answers.
Perhaps Morningstar's QCD video may be of assistance to you. http://beta.morningstar.com/videos/8186 ... arity.html

Again, as you stated, you must be 70.5 years or over to take advantage of QCD
.
This is only for IRAs------only for people who are 70 1/2, IRA owners or IRA beneficiaries who are 70 1/2 years old or older. So, that's the only people that the provision applies to.
People should not say everything they think. They should think about everything they say.

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Oak&Elm
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Re: QCD

Post by Oak&Elm » Mon Oct 30, 2017 12:59 pm

Thank you,

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