Speaking of tax liabilities in retirement, QCDs can be a very important consideration for retirees with significant giving goals. Once you turn 70 1/2, the IRS allows you to transfer up to $105,000 per year to qualified charities, tax-free. A QCD does not count as taxable income, but it does count as an RMD. So, in a given year, if you don't need an RMD to pay bills or meet another retirement goal, a QCD can help you meet the RMD requirement, lower your taxable income, and immediately help those in need.
A Roth IRA is a very beneficial retirement planning tool. Not only do your uk db center contributions grow tax-free, but your withdrawals are not included in taxable income. Additionally, the original owner of a Roth IRA does not have to take RMDs during his or her lifetime. However, heirs must meet RMD requirements, which generally follow the 10-year liquidation timeline for other inherited retirement accounts.
10. RMDs affect Medicare premiums.
The monthly Medicare premiums set by the Social Security Administration each fall are actually minimums. If your annual taxable income in retirement is above a certain amount, you will have to pay an income-related monthly adjustment amount (IRMAA) in addition to your premium. The taxable RMD does help determine if you have to pay this Medicare surcharge. We’ll discuss the 2025 premium amounts and IRMAA thresholds on our podcast, Keen on Retirement, when they are announced later this fall.
