IRA Contributions

 

Are you 70 ½ or older?

Do you have an Individual Retirement Account (IRA)?

Do you love your community?

 

A charitable contribution through an IRA might be for you.

 

In 2015, the law allowing "Qualified Charitable Distributions" from an IRA became permanent.   This means that an individual who is 70 ½ or older can distribute up to $100,000 directly from their IRA account to a charitable nonprofit organization each year.  A contribution to the Community Foundation is a “Qualified Charitable Distribution”, or QCD.  There are multiple benefits to this kind of contribution:

  • Gifts made from an IRA reduce your adjusted gross income (AGI), so they may reduce your state and federal taxes, too.
  • Qualified charitable distributions count towards your required minimum distribution (RMD) from your IRA.
  • A charitable contribution through your IRA allows you to make a significant gift without using cash or other assets.

 

There are a few other details and restrictions to consider:

  • You must be 70 ½ or older when you make a contribution through your IRA.
  • The gift must be from an IRA; no other retirement plans (such as 401k, 403b or SEP accounts) qualify.
  • Your QCD check must be issued by the IRA plan administrator directly to the Community Foundation in order to qualify.
  • Your gift cannot support a donor advised fund.
  • Although the distribution will be free from tax, it will not generate an income tax charitable deduction.

 

A charitable contribution through your IRA can be an advantageous way to give.  We recommend discussing the option with a professional advisor and contacting your IRA plan administrator to learn their procedure for making a qualified charitable distribution to a charitable organization.  If you would like to learn more about Where to Give, we can help!