There are several reasons why making a Charitable IRA Rollover or Qualified Charitable Distribution is in the best interest of a donor. In fact, with the new standard deduction as of 2018, many people are no longer able to itemize their deductions to include gifts to charity on their tax return. Often, donors are seeking advice on ways to reduce taxes on their Required Minimum Distribution (RMD) that begins at age 70 ½. Obtaining a checkbook for their IRA account makes charitable giving easier and reduces income tax and potentially reduces Medicare Part B premiums. 

Fortunately the conversation doesn’t have to stop there . . .

For donors under age 70 ½, ask if they’ve ever considered “bunching” their contributions into one year instead of spreading them out over multiple years. The basic concept of bunching is to group charitable gifts you intend to make in the future, into a single year. Using this strategy, your charitable contribution may be large enough to itemize your deductions in one year and utilize the standard deduction in the years that no gifts are made. The result will likely reduce taxable income. Always suggest that the donor discuss this strategy with their tax professional.