Wall Street Rallies as Cyber Monday Shoppers Log On
Partner Content By Reuters | November 26, 2018–4:39 PM EST
Wall Street bounced back on Monday as bargain hunters returned in force after last week’s sell-off and expectations of a flurry of holiday cyber-spending drove up shares of retailers.
The S&P 500 and the Dow Jones Industrial Average rose about 1.5 percent, while the Nasdaq advanced more than 2 percent. All three indexes posted their biggest percentage gains in nearly three weeks. On Friday the S&P 500 closed 10.2 percent below its record high, confirming a correction for the second time this year.
An online spending frenzy was expected as retailers tempted customers with a blizzard of discounts and free shipping. Cyber Monday spending is seen reaching an all-time high of $7.8 billion in the United States, according to Adobe analytics.
“What we’re seeing today is a relief rally,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. “It’s Cyber Monday shopping on Wall Street.”
E-commerce bellwether Amazon.com rose 5.3 percent, providing the biggest boost to both the Nasdaq and the S&P Retail index, which was up 3.1 percent.
Crude oil prices posted their biggest percentage jump in five months, driven higher by plunging U.S. stockpiles and increasing supply worries. That pushed energy shares up 1.7 percent. Brent crude prices have dropped nearly 30 percent since early October.
Meanwhile, General Motors Inc announced it would cut production, ax low-selling models and slash its North American headcount in the automaker’s biggest restructuring since emerging from bankruptcy a decade ago. The stock ended the session up 4.8 percent.
The Dow Jones Industrial Average rose 354.29 points, or 1.46 percent, to 24,640.24, the S&P 500 gained 40.89 points, or 1.55 percent, to 2,673.45 and the Nasdaq Composite added 142.87 points, or 2.06 percent, to 7,081.85.
All 11 major sectors of the S&P 500 advanced, with consumer discretionary and tech seeing the biggest percentage gains.
The technology sector rose 2.3 percent and provided the biggest boost to the S&P 500, following a slide of more than 6 percent last week, its worst drop in eight months.
Nvidia Corp gained 5.6 percent after Credit Suisse initiated coverage of the chipmaker with a bullish outlook.
Zafgen Inc shares plummeted 40.5 percent after the U.S. Food and Drug Administration put a hold on U.S. trials of the company’s experimental diabetes drug, citing safety concerns.
The third-quarter reporting season is largely over, with nearly 97 percent of companies in the S&P 500 having reported, 78 percent of which beat analyst expectations, according to Refinitiv data.
Investors looked ahead to the G20 Summit convening in Buenos Aires on Friday and Saturday, with U.S. President Donald Trump and China’s Xi Jinping expected to meet regarding their two countries’ escalating tariff dispute.
Advancing issues outnumbered declining ones on the NYSE by a 1.80-to-1 ratio; on Nasdaq, a 1.50-to-1 ratio favored advancers.
The S&P 500 posted 5 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 17 new highs and 101 new lows.
Volume on U.S. exchanges was 6.68 billion shares, compared to the 8.02 billion average over the last 20 trading days.
Can I Use Money from My IRA to Donate to Charity?
By Amy Fontinelle | November 21, 2018–6:00 AM EST
Yes, you can use money from your IRA to donate to charity. What’s more, your donation from a traditional IRA will be nontaxable since Congress and President Obama made that tax break permanent at the end of 2015.
How a Qualified Charitable Distribution from an IRA Works
Normally, when you take a distribution from a traditional IRA, you pay taxes on it since you didn’t pay taxes on the money when you put it into your IRA. But if you are age 70½ or older and make a contribution directly from your traditional IRA to a qualified charity, you can donate up to $100,000 without it being considered a taxable distribution. To avoid paying taxes on the donation, you must follow the IRS’s rules for qualified charitable distributions (QCDs), also called charitable IRA rollovers. Most churches, nonprofit charities, educational organizations, nonprofit hospitals and medical research organizations are qualified charities. The charity you give to will not have to pay taxes on your donation.
Since you are already getting a tax break on your donation, you cannot double dip and also claim the donation as a deduction on Schedule A. You’re allowed just one tax break, not two. If you make other donations to charity that don’t use your IRA funds, however, you can still claim each of those donations as an itemized deduction on Schedule A. If you don’t itemize your deductions on Schedule A and you take the standard deduction on your annual tax return instead, a charitable IRA rollover will give you a tax break that you otherwise couldn’t receive for donating money.
QCDs and Required Minimum Distributions
You can also use your qualified charitable donation to meet all or part of your IRA’s required minimum distribution (RMD) for the year. Traditional IRA owners must start taking RMDs at age 70½ or face tax penalties. The charity must receive your donation by Dec. 31 for you to apply it to that year’s tax return. Roth IRAs do not require distributions while the account holder is alive.
Qualified charitable donations are also a good choice for individuals who otherwise could not deduct all or part of their charitable donations because of the IRS rule that says you cannot take a tax deduction for the amount of your donations that exceeds 60% of your adjusted gross income (AGI). At first glance, this rule might sound like it only affects wealthy taxpayers who give generously, but it also affects anyone who is retired and has little to no income but still wants to make a tax deductible donation.
Tax Filing Requirements
Your IRA trustee will use IRS form 1099-R to report your qualified charitable distribution when you file your annual tax return. You will then report this information on form 1040. You should also keep your own records of the donation date, the account from which you made the donation, the amount you gave and the charity you donated to in case there is any discrepancy. You also need a receipt from the charity stating that you did not receive any goods or services in exchange for your contribution. If you do, the amount of your donation is reduced by the value of the goods or services you received in exchange, and that part of your donation will be taxable.
The Bottom Line
Using your IRA to make a charitable donation can help you lower your tax bill and help any charity you designate, as long as it is a qualified 501(c)3 organization. Keep in mind, too, that distributions must be made directly to the charity, not to the owner or beneficiary. All distribution checks need to be made payable to the charity or they will be counted as taxable distributions.
Another way to donate IRA assets to charity is through your estate after you pass away by naming the charity as the designated beneficiary of your IRA. The charity will receive whatever percentage of your IRA assets you provide for on the beneficiary form.
Distributions from SIMPLE IRAs are not eligible to be qualified charitable donations.
