OAEA Donations via RMD
A planned deduction that can help with taxes!
Are you thinking about making a donation to the OAEA this year, and also having to take the annual Required Minimum Distribution (RMD) from your/your spouse’s Individual Retirement Accounts (IRAs) for the year because you are over 72? Here is a nice option to consider!
The Old Antarctic Explorers Association is a 501(c)(3) charitable organization. As such, donations made to the OAEA may be deducted from your taxes. In a normal situation, the donor has paid income taxes on the donation and then under certain circumstances, may deduct that donation from their income tax amount paid. In the case of regular IRAs, in lieu of taking the required minimum distribution from IRAs paying the income tax that is required and then making a donation, the Qualified Charitable Distribution (QCD) option allows a non-taxable rollover donation direct from the financial institution to the charity without the taxpayer having to fill out a complicated IRS tax form to achieve the tax benefit from their contribution.
For example: If you have to take an RMD of $10,000 from your IRAs for the year, then when that money is transferred out of the IRA, income tax is withheld for $10,000.00. However, if the QCD option is exercised for $1,000.00 to be directly rolled over to the OAEA, then only $9,000.00 of the RMD is taxed. This QCD option is a great option if you are a regular contributor, and requires very little effort except to coordinate with the bank or financial advisor handling the IRA account; generally, all that is needed by the financial institution is the charity mailing address for the check and the charity tax ID number.
Many financial institutions have information about this QCD option on their websites, but in case yours doesn’t, here is something from the IRS that can help you make a decision: