By utilizing this giving technique, Linda is able to give in a very tax advantaged way. The IRA charitable rollover allows her to exclude the IRA distribution to the charities of her choice from her adjusted gross income (AGI). Thus, she is able to save income tax on this charitable gift. Additionally, the reduction of her AGI may reduce the taxation of her Social Security benefits and any deductibility “floors” limiting certain expenses (e.g., 7.5 percent for medical expenses in year 2018) and various other tax items.
While the IRA charitable rollover provides unique tax benefits not found with other types of gifts, there are some requirements and restrictions. You must be age 70 ½ or older at the time of the gift and are limited to transferring $100,000 to qualified public charities each year. Additionally, the gift must come directly from the IRA administrator to the charitable organization. You can’t receive your distribution and then pass it on to the charity. Lastly, the charity cannot have provided you any goods or services in exchange for the IRA charitable rollover.
If you would like to learn more about making a contribution to United Church Homes from your IRA, please contact Gloria Hurwitz, vice president of advancement and communications, at firstname.lastname@example.org or 740.751.8702. Additionally, United Church Homes is making available to its friends and stakeholders a complimentary values-based estate planning process designed to help individuals and couples think through their goals and objectives to create a comprehensive estate plan. For more information on how you can be added to the waiting list for this process, you can also reach out to Gloria Hurwitz using the above contact information.