You can give to a charity and to yourself in equal measure. If you are 70 1/2 or older, the IRA Charitable Transfer is an excellent way to make gifts and receive tax benefits in return, even if you take the standard deduction.
Transfers are made directly from a traditional IRA account by your IRA administrator to Noble Horizons.
IRA Charitable Transfers are excluded gross income for federal income tax purposes on your IRS Form 1040. You receive no charitable deduction, and they count towards your required minimum distribution for the year in which you made the gift.
For example, John is 71 and wants to make a gift to Noble Horizons. He has $100,000 in his IRA and he wants the contribution to be $1,000. He can authorize the administrator of his IRA to transfer $1,000 to Noble Horizons. The $1,000 distributed to Noble Horizons will be counted toward his annual minimum required distribution and he will not pay income tax on the portion given to charity.
It’s important to consider your tax situation before deciding whether to make a charitable contribution from your IRA, so be sure to share this gift plan with your financial advisor.