The IRS can help with stewardship!

If you are at least age 70 ½ and have an IRA, you may know about a tax benefit you may receive when making charitable contributions, such as to Mayflower! The IRS requires individuals with an IRA who are at least 70 ½ to make a required minimum distribution (RMD) from their IRA. The IRS now allows individuals to include charitable contributions made from their IRA as fulfilling the required minimum distribution.

This good news is that a charitable contribution given as a required minimum distribution, meeting the IRA rules, is considered tax exempt. That is, the IRS does not consider these qualifying charitable contributions as taxable income.

These rules have changed, and there are specific rules that must be followed to qualify for the tax benefit, so it is always important to discuss these matters with your financial adviser before making distributions for charitable purposes.

Rev. Howard Bell, a Mayflower member, has been inspiring Mayflower and other congregations in his ministry for years. Howard shares yet another way of extending our works and ministry by explaining his experience with giving through an IRA required minimum distribution:

“My financial advisors alerted me early this that I needed to make a decision prior to the end of the year regarding my Required Minimum Distribution (RMD) from my tax-sheltered annuity funds. They informed me that federal tax law requires an RMD beginning the year that a person turns seventy and one-half. Much to my joy and surprise, I hit that mark this year! I consulted with my tax adviser and confirmed that by giving these funds directly to 501(c)(3) charitable organizations, I could avoid paying taxes by 100% on my RMD. I included Mayflower Church in planning for my 2018 distribution, enabling me to increase my pledge to Mayflower. Even though I am unable to be in worship due to serving in Interim Ministry, I feel especially blessed by Mayflower Church and its ministries.”

The IRA required minimum distribution might be a way to support your stewardship through careful planning.