Thanksgiving has passed and we are approaching the holiday season. While the New Year is just around the corner, we can take this time to reflect on the year that is wrapping up and prepare for the one that is ahead of us. The holiday season is a wonderful time to show how much you appreciate and care for your loved ones, but also those who you may not know- but in your heart, care for as well. After all, ‘tis the season of giving.

The Tuesday after Thanksgiving, or rather the day after Cyber Monday has been coined as Giving Tuesday. “GivingTuesday was created in 2012 as a simple idea: a day that encourages people to do good.[1]” The notion to take pause among all the savings and deals to give to others and have the opportunity to be rooted back into the holiday spirit, which is a gift to us all.

Giving Tuesday encourages people to give what they can. It can be their valuable time to help out an organization or even a community member in a time of need, or financially, by donating or fundraising to help non-profits and organizations continue to do life-changing work for people and communities around the world.

Choosing to donate your financial support is a wonderful way to contribute to Giving Tuesday or any time during the holiday season. One benefit to consider when you can be more charitable with your money is that it can actually benefit you financially as well.

If you are over the age of 70 ½, you probably know about the IRS mandated Required Minimum Distribution or RMD. Many individuals dread the idea of having to take taxable income out of their tax-deferred accounts when they don’t need it to sustain their lifestyles. However, there is an alternative that doesn’t increase your taxable income and also allows you to give back to the community—the Qualified Charitable Distribution, or QCD.

A QCD is a direct transfer from an IRA account to a qualified charity. The amount donated to the charity can be counted towards satisfying an RMD, up to $100,000 and is also excluded from your taxable income. The funds must go directly to the charity of your choice without it passing through you, the donor.

A Qualified Charitable Distribution provides a way to lower your taxable income while benefiting the charity of your choice. This may not be the best choice for everyone, but it provides an alternative way of handling those pesky RMDs! Contact your Jacobi Team and tax advisor to see if you are eligible for a QCD and if it may be right for you!

Additionally, check out this RMD document to help ensure you don’t run into mistakes when trying to approve your RMD.


Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.