Rick has written on the benefits of giving to charity from your IRA, as a Qualified Charitable Deduction (QCD) if you are over age 70½. Many of you took advantage of this benefit in 2018 by giving a gift directly from your IRA to the charity of your choice.
IMPORTANT NEXT STEP:
If you gave a QCD in 2018, there is a very important step in assuring the gift is tax deductible on your 2018 taxes. You must tell your accountant! TD will report the withdrawal as taxable (they have no other choice). However, the IRS has no way of knowing this distribution was a QCD. There is no place on the tax return to note this is a QCD. The only way to take advantage of your QCD is if your accountant enters your total distributions, adjusts for the non-taxable portion, and writes “QCD” on the return. Clumsy and inefficient? Yes. But it’s imperative to getting the deduction.
So, please remember to inform your accountant ASAP if you did a QCD in 2018.