Attention 73 Year Olds
Congratulations if you are turning 73 in 2024 or have already achieved that milestone!
Seventy-three is the age when you must begin taking your Required Minimum Distribution (RMD) from your 401(k), 403(b) and Traditional IRA. A Roth IRA has no required distribution. The amount of your RMD is based on a formula that includes your IRS life expectancy and the value of your account on December 31. You may have received a notice from the IRS stating the amount you need to withdraw. Obviously, it is recommended that you discuss this with your financial advisor or tax accountant.
However, you can minimize the amount of tax you pay on this distribution by donating directly from your account to a qualified charity. Tax-free donations must be made directly to the qualified charity and cannot be funneled through your checking/savings account. And since so many people no longer itemize on their IRS Form 1040 and receive tax deductions for charitable donations, a qualified charitable deduction can be a better tax move for those seeking to give to a charity.
By the way, Poolesville Seniors is a 501(c)3 and is qualified to receive these donations. See an explanation at Qualified Charitable Distribution Donations – Poolesville Seniors