Last year, Congress passed legislation extending the charitable IRA rollover and making this provision permanent for future years. For those who are 70 ½ years of age or older, up to $100,000 can be transferred directly from traditional or Roth IRA to one or more qualified charities such as the Diabetes Research Institute Foundation free from federal income tax each year.
There may also be state income tax savings. Amounts given in this way count toward required IRA minimum withdrawal amounts for the year of the gift. It is important to not withdraw funds prior to making the gift, but have the gift distributed directly from an IRA to the qualified charity(ies).
What Are The Benefits?
- Donors can transfer up to $100,000 per year directly from a Traditional or Roth IRA to the Diabetes Research Institute Foundation without paying income taxes on the funds transferred.
- For those donors who do not itemize deductions, a gift from and IRA is excluded from reportable income, thus simplifying tax returns.
- Direct transfers from an IRA can satisfy the IRS Required Minimum Distribution (RMD).
- The giving incentive is of particular value to individuals who do not claim itemized deductions on their tax return because the funds are sent directly to nonprofits from IRA accounts and are never counted as income.
What Are the Rules?
- Donors must be 70 ½ years old or older when making the qualified charitable distribution.
- The distribution must go directly from a Traditional or Roth IRA to the Diabetes Research Institute Foundation.
- Gifts cannot exceed $100,000 per taxpayer, per year.
- Gifts must be outright (not to a donor-advised fund, support organization, charitable trust, or charitable gift annuity).
- The donor does not receive an income tax deduction because there is no tax being paid on the withdrawal of the funds.
Learn more about these special opportunities by contacting:
Jill Shapiro Miller at email@example.com or 1-800-321-3437