Jan 28, 2019 QCD- Important news regarding tax preparation for 2018.
Important news regarding tax preparation for 2018
Did you make a Qualified Charitable Distribution (QCD) from your IRA in 2018?
If you gifted to a qualified charity directly from your IRA in 2018 there are steps you need to take to make sure it gets reported properly on your taxes.
You will receive a 1099R tax form from your IRA custodian that will give you the total amount that was taken from your IRA for the year. It will NOT break out the portion that went directly to charity. The portion that went directly to charity is not taxable.
You will need to track down receipts from the charities that received the money, sum up the total, and let your tax preparer know the amount that was given to charities. The receipts should be kept in your records as support in an audit.
If you do not communicate that the gift was directly from the IRA, your tax preparer may assume that you did not do a gift from your IRA and report it in a different manner. Most likely, you will pay more in taxes.
To self report a qualified charitable distribution on your Form 1040 tax return, you generally report the total taken from the IRA on the line for IRA distributions (Line 4a). The amount gifted directly from the IRA to charity will be subtracted from the total and the remaining amount will be reported as the Taxable amount on line 4b. Enter “QCD” next to this line. See the Form 1040 instructions for additional information.
If you would like to confirm the amount that was sent directly from your IRA’s to help track down your receipts from the charities, please give us a call at Leonard Rickey Investment Advisors.
Company News
Market Commentary
Retirement Planning
Tax Planning
Cyber Security
Important Disclosures
Leonard Rickey Investment Advisors, PLLC (“LRIA”), is an SEC registered investment adviser located in the State of Washington. Registration does not imply a certain level of skill or training. For information pertaining to the registration status of LRIA, please contact LRIA or refer to the Investment Adviser Public Disclosure website (www.adviserinfo.sec.gov).
This is provided for general information only and contains information that is not suitable for everyone. As such, nothing herein should be construed as the provision of specific investment advice or recommendations for any individual. To determine which investments may be appropriate for you, consult your financial advisor prior to investing. There is no guarantee that the views and opinions expressed herein will come to pass. This newsletter contains information derived from third party sources. Although we believe these third-party sources to be reliable, we make no representations as to the accuracy or completeness of any information prepared by any unaffiliated third party incorporated herein and take no responsibility therefore.
Any projections, forecasts and estimates, including without limitation any statement using “expect” or “believe” or any variation of either term or a similar term, contained here are forward-looking statements and are based upon certain current assumptions, beliefs and expectations that LRIA considers reasonable or that the applicable third parties have identified as such. Forward-looking statements are necessarily speculative in nature, and it can be expected that some or all of the assumptions or beliefs underlying the forward-looking statements will not materialize or will vary significantly from actual results or outcomes. Some important factors that could cause actual results or outcomes to differ materially from those in any forward-looking statements include, among others, changes in interest rates and general economic conditions in the U.S. and globally, changes in the liquidity available in the market, change and volatility in the value of the U.S. dollar, market volatility and distressed credit markets, and other market, financial or legal uncertainties. Consequently, the inclusion of forward-looking statements herein should not be regarded as a representation by LRIA or any other person or entity of the outcomes or results that will be achieved by following any recommendations contained herein. While the forward-looking statements here reflect estimates, expectations and beliefs, they are not guarantees of future performance or outcomes. LRIA has no obligation to update or otherwise revise any forward-looking statements, including any revisions to reflect changes in economic conditions or other circumstances arising after the date hereof or to reflect the occurrence of events (whether anticipated or unanticipated), even if the underlying assumptions do not come to fruition. Opinions expressed herein are subject to change without notice and do not necessarily take into account the particular investment objectives, financial situations, or particular needs of all investors.
For additional information about LRIA, including fees and services, please contact us for our Form ADV disclosure brochure using our contact information herein. Please read the disclosure brochure carefully before you invest or send money.
Presidential Elections and the Market