Can You Still Get a Tax Benefit From a Charitable Contribution?
YES !
If you are 70.5 or older and have an IRA.
The standard deduction is $30,750 for a married couple over 65 ($16,550 single). So now almost no one will need to itemize their deductions. Which means that they will not get a tax benefit for making charitable deductions.
HOWEVER, by making their contribution directly from their IRA to the charity, it is included in their Required Minimum Distribution but is not included in their taxable income. No taxes! 100% goes to the charity!
But do it the right way. If you take a distribution from your IRA first and then write a check to the charity, you will have to pay income tax on the distribution but will not get a deduction for making a contribution. (For a $1,000 distribution and then a contribution, this would cost you $240 in tax at the 24% rate, $320 at 32%. For $5,000 it could be $1,600 in tax).
SO HOW DO I DO IT?
Just call your account rep with the bank or investment firm that manages your IRA. Or call their customer service number. Give them the name of the charity and they will write a check and send it to the charity. Or they will make it payable to the charity and send the check to you so that you can give it to your charity.
But don’t wait until Christmas, get too busy, and then don’t get around to it. You can do it at anytime during the year. Also, your investment firm needs some lead time. Fidelity Investments, for example, wants your request by November 30th.