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Heads Up!

January 9, 2017 | Weekly Commentary

If you are charitably inclined and have adequate cash flow available, might it be time to put the brakes on Required Minimum Distributions taken from your IRA’s in the early months of the year?  Depending on what tax proposals eventually make it into law, those 70 ½ and older may benefit more from making their larger charitable contributions directly out of their IRA whereby that income won’t be reported on page 1 of your return. These types of charitable distributions are not deducted, therefore, on the Schedule A for itemized deductions.  With proposed higher standard deductions in the possible 2017 Income Tax Simplification, many older taxpayers won’t benefit from itemizing anymore and wouldn’t receive a tax benefit from charitable giving. If you make your charitable contributions through the Qualified Charitable Distribution (QCD) strategy, there is an opportunity to save income taxes whether you itemize or not.  Ask us for details and what you should review to make sure this strategy is available to you.

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