The use of Qualified Charitable Distributions (QCDs) & Required Minimum Distributions (RMDs) to fund the Lord’s work can be a win-win situation.
Qualified Charitable Distribution (QCD) provides you with an opportunity to make tax-free contributions to any qualified public charity from your IRA.
Current tax law allows someone age 70 ½ or over to make a gift directly from a traditional IRA to a charity, such as your local church, school, or the Wisconsin Conference of Seventh-day Adventists, by means of a QCD. * Warning: The contribution must go directly from your IRA custodian to the charity and not come to you first.
This QCD option may be of special interest to those who must take a Required Minimum Distribution (RMD) annually from a traditional IRA. The gift counts toward your annual RMD; however, it does not count as taxable income to you. Hence, this is a win-win situation.
You, the taxpayer, win in three ways:
1) You essentially lower your taxable income, and thus your taxes.
2) If you have a Required Minimum Distribution (RMD), the QCD contribution counts toward satisfying it. By the way, up to a maximum of $100,000 of your RMD can be donated to a qualified charity…this would include returning tithe. UPDATED (12/4/24): As of January 1, 2025, up to a maximum of $108,000 per individual of your RMD can be donated to a qualified charity.
3) You get to support the church’s mission and ministry. This might include your local Seventh-day Adventist Church, School, or the Wisconsin Conference. Keep in mind, a QCD option applies to all qualified charitable organizations.
NOTE: Always consult your financial advisor, IRA plan administrator, tax preparer, IRS Publication 590-B, or the IRS website www.irs.gov.
Updated (12/4/24): MORE GOOD NEWS! The IRS SECURE ACT, which became effective in 2023, allows you to use your IRA to create a Charitable Gift Annuity (CGA) up to $53,000 in 2024. In 2025 the limit will increase to $54,000. This kind of a CGA allows a donor to make a one-time gift to their charity of choice directly from their IRA (tax free) and receive life-time payments to the donor that will never decrease.
* This article is based on information from the following site: www.sneucc.org/blogdetail/17384323
If you have questions about the services that the Wisconsin Conference Planned Giving Department provides, please contact Pastor Bill Ochs @ 920-484-6555 or bochs@wi.adventist.org
Bill Ochs, Planned Giving & Trust Services Director