Since no tax is incurred on the withdrawal, gifts do not qualify for an income tax charitable deduction, but are eligible to be counted toward an individual’s minimum required distribution. A Charitable IRA Rollover makes it easier to use IRA assets, during lifetime, to make charitable gifts.
There are three important restrictions for Charitable IRA Rollovers:
- Distributions must be made directly to a qualified charity by the plan administrator of an IRA. Retirement assets in 401(k), 403(b), SEP, or SIMPLE plans do not qualify but may be rolled into a new or existing IRA and transferred to the charity.
- Distributions may only be made to 501(c)(3) tax exempt organizations such as Lund and cannot be made to donor advised funds, private foundations, or supporting organizations.
- Distributions may not be used to fund life-income gifts such as charitable gift annuities, charitable remainder trusts, or pooled income funds.
Donors with significant assets in an IRA and people who do not itemize their deductions stand to benefit from using the Charitable IRA Rollover to make a gift. It is also beneficial for people making gifts that are large, relative to their income. (Because a charitable rollover is not included in taxable income, it does not count against the usual percentage limitations on using income tax charitable deductions.)
How to Donate
Please have your IRA trustee make the check representing your qualified charitable distribution payable to Lund and have them send it to the following address:
Attn: Megan Clodgo,
Lund,
50 Joy Drive,
South Burlington, VT 05403
Contact Sharon Lifschutz, Director of Development at (802) 861-2580 or sharonl@lundvt.org for instructions on how to complete a Charitable IRA Rollover.
The purpose of this page is to provide general gift, estate, and financial planning information. It is not intended as legal, accounting, or other professional advice. For assistance in planning charitable gifts with tax and other financial implications, the services of appropriate advisors should be obtained. Consult an attorney for advice if your plans require revision of a will or other document.
