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2016 Year End Tax Advice

| December 01, 2016

It’s that magical time of year once again. Lights are glittering in our neighborhood, the shopping malls are bustling with activity, and nearly every radio station is adding holiday music to their rotation. During this season of giving, nearly 34 percent of all charitable contributions are done in the last three months of the year. Of that 34 percent, about 18 percent is given in December alone.1

If you, like many people this time of year, are considering giving to your favorite charity, it’s never been easier to do so while minimizing the tax bite of an IRA’s Required Minimum Distribution (RMD) obligations. The Protecting America from Tax Hikes (PATH) Act of 2015 has made the Qualified Charitable Distribution (QCD) rules permanent and there are numerous advantages to making a QCD this year; these potentially include:

  • Reducing income tax on Social Security benefits
  • Reducing Medicare insurance premiums
  • Reducing adjusted gross income to allow for more itemized deductions
  • Increasing availability of other charitable giving deductions

Give us a call to see if this strategy might work for you.

Happy holidays!