Tuesday, August 5, 2008

Tax-Free Distribution from IRA's for Charity

In 2006 and 2007 a person who is 70 1/2 years or older takes a distribution from an IRA, contribute it to a charity and not recognize any income. This is however limited to$100,000 . If the IRA account contains nontaxable amounts for example, nontaxable contributions, the taxable portion is considered to come out first, followed by nontaxable amounts.

A deduction for contributing clothing and household items (furniture, furnishings, electronics, appliances, linens) is not allowed unless the item is in good condition or better unless the deduction claimed is more than $500 and you get an appraisal.

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