Giving to SCCM can be a benefit in many ways. Not only does it allow SCCM to help to improve the lives of the critically ill and injured around the world, it can also make a positive impact on your personal income taxes. You can withdraw money from your individual retirement account (IRA) and donate it to SCCM using a qualified charitable distribution (QCD).
What Is a Qualified Charitable Distribution?
A QCD is a withdrawal of funds from an IRA made with the intention of donating it directly to a qualified charity. A qualified charity must be a 501(c)(3) organization eligible to receive tax-deductible contributions.
You may qualify for a QCD if you have a traditional IRA, an inactive SIMPLE IRA (meaning you and your employer are no longer contributing to the account during the same tax year in which you are making the charitable contribution), an inactive SEP-IRA, or an inherited IRA. Certain rules apply. Roth IRAs may be eligible for a QCD but withdrawals will be subject to tax.
What Counts as a QCD?
An IRA distribution must meet all the following requirements to be a QCD:
1. It cannot occur before you, as the IRA owner or beneficiary, have reached age 70½.
2. It must meet the normal tax law requirements for a 100% deductible charitable donation. If you receive any benefits that would be subtracted from a donation under the normal charitable deduction rules (such as free tickets to an event), the distribution cannot be a QCD.
3. It must be a distribution that would otherwise be taxable. A Roth IRA distribution can meet this requirement if it is not a qualified (tax-free) distribution.
Important Points to Remember
• If you inherited an IRA from the deceased original account owner, you can donate using a QCD from the inherited account if you have reached age 70½.
• The maximum annual amount that can qualify for a QCD is $100,000. This limit applies to the sum of QCDs made to one or more charities in a calendar year.
• There are several tax advantages of QCDs. Please contact your financial advisor to discuss these.
Helpful Resources
• Your IRA provider
• Internal Revenue Service
Disclaimer: The content provided is for informational purposes only. The Society of Critical Care Medicine (SCCM) and its affiliates do not provide tax, legal, accounting, or estate planning advice. The information provided should not be relied upon for tax, legal, accounting, or estate planning advice. You should consult your own tax, legal, and accounting advisors.
