The strategy, known as qualified charitable distributions, or QCDs, allows retirees to transfer money from an individual retirement account to an eligible nonprofit organization.
"It's like hitting two birds with one stone," said certified financial planner Sean Lovison, founder of Philadelphia-area Purpose Built Financial Services.
If you're age 70½ or older, you can use a QCD to donate up to $100,000 for 2023.
How QCDs provide a tax breakSince 2018, there's been a higher standard deduction, which makes it tougher to claim a tax break for charitable gifts.
If you're age 73 or older, QCDs can also cover your required minimum distributions, which otherwise would have boosted income, experts say.
Persons:
there's, Sean Lovison, Marguerita Cheng, Kevin Brady, aren't, Ольга Носова
Organizations:
Blue, Global Wealth, CNBC's, Social Security, Wealthspire Advisors
Locations:
Philadelphia, Gaithersburg , Maryland, New York