A great way to give a gift to Elders Action Network in 2023
Did you know that your 2023 year end gift to Elders Action Network can also help satisfy a Required Minimum Distribution (RMD) for your tax deferred retirement accounts?
How do I turn my RMD into a donation to Elders Action Network?
One way to do this is by making a direct transfer of funds from your IRA custodian, a qualified charitable distribution (QCD) to Elders Action Network. The QCD can have significant income tax benefits to you. A QCD is pre-tax, meaning it does not appear in your taxable income, and therefore you don’t have to pay tax on that amount of the distribution.
An RMD, however, is taxable income. You can get this tax benefit even if you take the standard deduction. And finally, by reducing your taxable income, it could result in a lower tax bracket.
You’ll want to check with your financial advisor today to advise you on what strategy is right for you.
How do I make my donation to Elders Action Network?
U.S. Mail: Elders Action Network, 9012 Village View Dr., San Jose, CA 95135
Elders Action Network (formerly, Conscious Elders Network) is a nonprofit, tax-exempt charitable organization under Section 501(c)(3) of the Internal Revenue Code. Donations are tax-deductible as allowed by law. Tax identification number: 46-4569152
For more information on how you can support the work of Elders Action Network, please contact Diana Shoemaker, Executive Director, firstname.lastname@example.org or Bill DeVincenzi, EAN Treasurer email@example.com.
What is a Required Minimum Distribution (RMD)?
At some point in your life, you may have put money into tax-deferred retirement accounts, such as Individual Retirement Accounts (IRAs) and 401(k) workplace retirement accounts. While you postponed taxes on your contributions and earnings; you didn’t eliminate them. Eventually, you must pay tax on your contributions and earnings. It’s important not to skip the RMD because, if you do not take any distributions, or if the distributions are not large enough, you may have to pay a 50 percent excise tax on the amount not distributed as required, according to the IRS.
What accounts have a RMD?
- Traditional IRAs
- Simplified Employee Pension (SEP) IRAs
- Savings Incentive Match Plan for Employees (SIMPLE) IRAs
- Nonprofit 403(b) plans
- Government 457 plans
- Profit-sharing plans, and
- Other defined contribution plans
Roth IRAs are funded with after tax contributions and they don’t require RMDs until after the owner dies. If you’re still working and have a traditional 401(k) or other workplace defined contribution plan, you may be able to defer RMDs until April 1 of the year after you stop working.
When does a RMD start?
The distributions are required to start when you turn age 72 (or 70 1/2 if you were born before 7/1/1949).
How much will my RMD be?
You’ll want to check with your financial advisor to calculate your RMD. Be aware that you can take your RMD out of one account, or take bits from each one, so long as you withdraw the required minimum.