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Investors who chafe at having to take required minimum distributions (RMDs) each year have a new tool to help them reduce the tax bite of these withdrawals – and provide retirement income for life.
Each year, you can make a tax-free charitable gift from your IRA or certain other pre-tax retirement account. This is known as a qualified charitable distribution or a QCD.
Income tax is generally not due on any part of the RMD from an IRA which is paid to a charity. These are called Qualified Charitable Distributions (QCD). [5] Employer-sponsored qualified retirement plans, such as 401(k) plans, require the same distributions that IRAs do. The beginning date requirement may be later than the date for IRAs.
Many investors begin taking retirement distributions when they claim Social Security retirement benefits, which can be as early as 62. You can make penalty-free withdrawals from any type of ...
All retirees 73 and older must take required minimum distributions (RMDs)-- mandatory annual withdrawals -- from certain retirement accounts by Dec. 31.There are exceptions for Roth accounts and ...
Image source: Getty Images. 1. Roth 401(k)s are no longer subject to RMDs. Anyone who opted into their workplace's Roth 401(k) and used it as their only retirement account could've been in for a ...
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