The dedication of the Valle Catholic Schools Foundation is simple yet profound: Provide long-term financial stability for Valle Catholic Schools and support academic excellence for our community families today, tomorrow, and for future generations.
One powerful method of charitable giving donors can use to support this mission is through Qualified Charitable Distributions (QCDs). Initiating this charitable distribution can often provide many tax advantages for the donor, making it a true “win-win” for your financial plan and the future of Valle Catholic Schools.
Here is a closer look at what a QCD is, the benefits, and how you can get started.
What is a Qualified Charitable Distribution (QCD)?
A Qualified Charitable Distribution (QCD) is a tax-smart way for anyone 70.5 or older to donate directly from their Individual Retirement Account (IRA) to a charity of their choice.
You can instruct your IRA custodian to send a specific amount of money directly to the Valle Catholic Schools Foundation. Since the funds never enter your personal bank account, the withdrawal is generally excluded from your taxable income.
The Key Benefits
1. Fulfills Your Required Minimum Distribution (RMD)
For many retirees, once they reach a certain age, the IRS requires a Required Minimum Distribution (RMD) from their traditional IRA each year. This RMD is typically counted as taxable income. A QCD offers a powerful solution: it counts toward satisfying the annual RMD requirement while lowering the total taxable income.
2. Reduces Your Taxable Income
This is the biggest benefit. Normally, an RMD is treated as taxable income. By using a QCD, the money donated is not included in your gross income. This immediate exclusion can help:
- Lower the adjusted gross income (AGI).
- Reduce the overall tax bill.
- Potentially reduce the taxes paid on Social Security benefits.
3. Provides a Powerful Way to Give
A QCD allows you to make a significant impact on Valle Catholic Schools Foundation without dipping into your liquid savings or income. It turns assets you are required to withdraw anyway into a powerful way to build your legacy.
Get Started Today
While the process is straightforward, the decision to initiate a QCD often involves complex financial planning.
For questions regarding your IRA and how to execute the transfer:
- Contact your IRA Custodian or Brokerage: They are the professionals who handle your retirement accounts and will process the direct transfer to the Valle Catholic Schools Foundation.
For questions regarding your gift to the Valle Catholic Schools Foundation:
- Contact Jason Blum with HSB Advisors, LLC.: As the official financial consultant for the Valle Catholic Schools Foundation, he is able to help with any charitable giving questions you may have. He can be reached at 573.880.5591.
By utilizing a Qualified Charitable Distribution, you can ensure a strong financial future for Valle Catholic Schools while achieving significant tax efficiency for yourself. It is a true legacy gift that helps our community today, tomorrow, and for generations to come.