The recommendation about QCDs is if he is already givingYes, excuse me. Take RMD plus extra to stay within tax bracket.
Slight correction:
You don't take out more RMDs. The RMD is the minimum you MUST withdraw, but you can
withdraw more.
You cannot convert the RMD to Roth, but you can convert any additional withdrawal.
The advantage of withdrawing extra is that though it increases the tax in the current year,
there are no RMDs on whatever you have converted, which would allow for a lower RMD
in the next tax year.
What may interest your father more if he hates taxes:
If your father contributes to charity, he can make a Qualified Charitable Distribution (QCD).
This can count as part of the RMD. QCDs are not taxed, and you don't have to itemize.
I would do that early in the year. QCDs can be made after age 70 1/2 , so he is eligible.
This would reduce his taxes compared to not making the QCD if he is already charitable
contributions.
A QCD can only be made from an IRA not an employer plan, so he may have to
do a (partial) rollover to an IRA and make the QCD from the IRA. IRAs have their
own RMDs separate from say 401k or 403b RMDs as well.
I had considered giving to charity but how useful is that really? (I've never done it and don't know how that would look)
So give a small amount to charity just enough to lower taxes?
or plans to give.
I already make charitable contributions to qualifying charities, so
as soon as I am 70 1/2 I will not be taxed on them because I will
make these by QCDs.
Charitable giving will always cost you money, just less when
you do it by QCD, assuming you do not itemize (I don't).
Statistics: Posted by MathWizard — Fri Jan 31, 2025 9:49 pm — Replies 56 — Views 7462