A recent change in the tax law allows tax free contributions from your IRA to a charity of up to $100,000 per year. In a regular IRA you contribute pre-tax dollars to the account and they grow tax deferred until you withdraw them. You pay ordinary income taxes on the distributions at whatever tax bracket you are in at the time.
The ability to make a charitable contribution from the IRA means that you can avoid paying taxes on the funds. You can't double dip however. You won't be able to claim the donation as a deduction on your taxes. But if you don't itemize your deductions and take the standard deduction, this may be an attractive alternative for you.
There are special restrictions on this program so check with your tax advisor before acting.
Comment Preview