|Used with permission|
One thing many of us would like to do in retirement is to give money to charity, including our churches. Another thing many of us would like to do is to avoid paying taxes. IRA Qualified Charitable Distributions can help you do both.
One you reach 70.5 years of age, the law requires you to take (and pay taxes on) a certain portion of your IRA accounts. One way around that requirement is to have the distribution sent directly to a qualified charity. By way of example, if your goal was to donate $2400 this year to your church, and your minimum required distribution was that amount or more, you would tell the custodian of the IRA to send the $2400 directly to the church. If you itemize your deductions, there may or may not be an advantage to this, since charitable donations are deductible, but if you take the standard deduction, this technique allows you to not add this money to your income. Unfortunately, this technique cannot be used by younger people who have inherited IRAs from which they are taking minimum required distributions. Ask your tax advisor if this is a good idea for you, or run the numbers yourself. The IRS rules are here. While it says it is only valid through 2014, to me it has the looks of something that is haggled over and then renewed yearly.