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Some Of Our Members Have Asked For More Information On QCD’s, RMD’s, Donor Advised Funds And Automatic Annual Payments And What This All Means.

A QCD is a Qualified Charitable Distribution. According to the IRS website: "Normally, distributions from a traditional individual retirement arrangement (IRA) are taxable when received. With a QCD, however, these distributions become tax-free as long as they're paid directly from the IRA to an eligible charitable organization." Also, you must have the same type of acknowledgment of your contribution that you would need to claim a deduction for a charitable contribution. In addition to the benefits of giving to charity, a QCD excludes the amount donated from your taxable income, which is unlike regular withdrawals from an IRA which are generally taxed.” PBKNCA is a qualified charitable organization.

 

QCDs distributions must be made after taxpayer has reached the age of 70 ½ years and are limited to a total of $100,000 per tax year. Whether or not an IRA account may be used to make a QCD depends on the type of IRA and your individual situation. You may make a QCD if you are 70 ½ or older regardless of whether or not you are required to take a Required Minimum Distribution (RMD) from your IRAs, either because of the age requirement, which was raised under the 2019 Secure Act or because of the blanket waiver of RMDs for 2020 It is important that a donor abide by the following rules for the donation to receive QCD treatment:

 

1. Any QCD must come directly from your IRA Custodian (financial institution) to the qualified charitable organization, you cannot receive the funds then pay it to the charity.

2. The donor may not receive any goods or services for their donation.

3.  We must be able to process the donation within the calendar year, which means that last minute donations just before the end of the year won’t get this special treatment. Please be sure to make your donation no later than November 30th.

4. Please make your check payable to PBKNCA and return the form with your check to:

PBKNCA

c/o Ms. Patricia Kenber VP membership

1073 River Rock Lane

Danville CA 94526-4001

This organization is not qualified to give you tax advice. You need to consult your tax advisor and/or IRA Custodian to determine if this type of donation is appropriate for you.  The tax laws dealing with IRAs have changed recently and may change again.

 

A RMD is a Required Minimum Distribution. The IRS states You must take your first required minimum distribution for the year in which you reach age 72 (73 if you reach age 72 after Dec. 31, 2022). However, you can delay taking the first RMD until April 1 of the following year." Your required minimum distribution is the minimum amount you must withdraw from your account each year.  For most people, this amount is added to your taxable adjusted gross income. By making a charitable contribution (QCD) from your required minimum distribution (RMD) to a qualified charity like PBKNCA you will not only do meaningful philanthropy but may lower your adjusted gross income.

 

 A Donor-Advised Fund (DAF) is like a charitable investment account, for the sole purpose of supporting charitable organizations you care about. When you contribute cash, securities or other assets to a donor-advised fund at a public charity, like for example Fidelity or Schwab Charitable, you are generally eligible to take an immediate tax deduction. Then those funds can be invested for tax-free growth and you can recommend grants to virtually any IRS-qualified public charity. This is not the same as a QCD.

 

Although the PBKNCA cannot and does not offer financial advice, if these vehicles sound like something that fits your philanthropic needs, please contact your financial advisor or institution for further details.

 

Automatic Annual Payments are available for members who don't want the hassle of rejoining every year.  As a member, you can change to this from your Member profile. New members can select this from the Join/Renew page

Please send the check you receive from your brokerage or give them this address. Please make your check payable to PBKNCA.

PBKNCA

c/o Ms. Patricia Kenber VP membership

1073 River Rock Lane

Danville CA 94526-4001

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