 IRA Charitable Rollover
Tax-Free Gifts from IRA Accounts Re-Authorized!
If you are looking for a tax-effective gift to make to a charitable organization, your individual retirement account (IRA) may very well be the best choice. Congress has re-authorized legislation that allows donors to make charitable gifts from their IRA accounts during the 2008 and 2009 tax years without incurring income tax on the withdrawal.
If you are required to take minimum withdrawals, this may be a great way to make a gift to one or more qualified charities. The extended legislation allows you to make outright gifts through direct transfers to charitable organizations without paying income tax on the distribution. Plus you can witness the impact of your gift to Midland Lutheran College.
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"As one who is required to take a mandatory distribution from my IRA, it was nice to find out that our good Uncle Sam has permitted rollovers to charitable organizations without incurring tax liability. This allowed us to make a substantial contribution in 2007 and now again in 2008. It's a wonderful way to contribute to the Luther Heritage Fund with funds which you must withdraw, but without incurring a tax liability."
Gene Dahlgren is a 1949 graduate of Luther College. In the mid-1980's Gene helped establish the Luther College Heritage Scholarship, which seeks to perpetuate the values and commitments of Luther College in Wahoo, Nebraska, one of the predecessor institutions of Midland Lutheran College. Gene and his wife, Jayne reside in Fullerton, California. |
Some of the key information regarding this opportunity is:
- The donor (IRA owner) must be 70 ½ or older on the day of the gift.
- The donor’s total combined IRA rollover gifts to charitable organizations cannot exceed $100,000 in any one year. If your spouse has a separate IRA account, you can each contribute up to $100,000 per tax year.
- All contributions must be made on or before Dec. 31, 2009.
- Transfers must be made from a traditional or Roth IRA account by your plan provider DIRECTLY to the charity. Funds withdrawn by you and then contributed DO NOT qualify.
- Distributions from 403(b) plans, 401(k) plans, pension plans, and other retirement plans are ineligible for the tax-free treatment.
- A gift from your IRA account cannot be claimed as a charitable tax deduction.
It is a simple process. Contact your IRA administrator to request the direct transfer. You may personalize the accompanying sample letter to make your request. Remember, you will need to make your gifts on or before Dec. 31, 2009 to qualify.
If you are considering making a gift such as this, it is advisable to discuss your intentions with your legal, tax and/or financial advisors to be certain this is the best plan for you. This information is not intended as legal or tax advice.
If you would like to consider this vehicle to support Midland Lutheran College, please contact Jordan Rasmussen at 402-941-6522 or rasmussen@mlc.edu.
Disclaimer: This information is based on our initial analysis and impression of the provision contained in The Emergency Economic Stabilization Act of 2008. Although we have made every effort to ensure accuracy, information contained herein is not to be construed as legal, accounting, tax, investment, or other professional advice. We urge you to seek competent counsel prior to relying on the opinions and information express herein.
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