For ITA readers living in states where the new tax laws of the United States impacted charitable contributions, the following information will be useful. The following concept may not be new to many readers, but for those who are not using this option for giving to not-for-profit organizations, follow along. Comments and questions are most welcome.
TDAmeritrade, as well as many other brokers, offer the opportunity to set up a checkbook tied to a tax deferred account such as a self-directed IRA. Instead of giving to the charity of your choice out of a taxable checking account, write checks on the tax deferred account so as to reduce the amount that needs to be withdrawn by the Required Minimum Distribution law.
Here in Oregon, we are penalized by the new tax laws as it is not too difficult to reach the threshold deduction when combining property taxes, charitable contributions, and other lawful deductions. To circumvent the new maximum deduction allowed by the new law, move charitable contributions from the standard checking account over to a checking account set up for the tax deferred account.
I asked the officer at TDAmeritrade if there was a limit in the size of the check? Was there a limit on the number of checks written over a given time period? I was told there are no restrictions. A friend of mine told me she was limited to writing checks equal or greater than $500.
I would appreciate hearing from readers who are using tax deferred accounts as their source for charitable giving and what restrictions, if any, are required by the broker.