The IRA Charitable Rollover was first enacted as part of the Pension Protection Act of 2006 and permanently extended in the Protecting Americans from Tax Hikes Act of 2015. Now, you can make a charitable gift directly from your Individual Retirement Account (IRA) every year while excluding the amount of that gift from your adjusted gross income (AGI).
Advantages to you:
- You can use an often-overlooked asset to make a gift to WYEP.
- The IRA Charitable Rollover permits you to make donations directly to charitable organizations like 91.3 WYEP from your IRA without counting the distribution as part of your AGI and, consequently, without paying taxes on it.
- You can receive a tax benefit regardless of whether you itemize deductions or take the standard deduction on your income tax return.
- The distribution can count toward your required minimum distribution for the year.
- You must be 70½ or older.
- Distributions can only be made from traditional Individual Retirement Accounts or Roth IRAs. Charitable donations from 403(b) plans, 401(k) plans, pension plans, and other retirement plans are ineligible for the tax-free treatment. Distribution must be made directly from the IRA trustee payable to WYEP or another qualified public charity.
- Your total combined charitable IRA rollover contributions are limited to $100,000 per year. (Married couples may be able to contribute up to $200,000.)
- Qualified Charitable Distributions from an IRA must go directly to a public charity that is not a supporting organization. Contributions to donor-advised funds and private foundations generally do not qualify for this special treatment.
- You cannot receive any goods or services in exchange for your Qualified Charitable Distribution.
- You must receive an acknowledgement from WYEP or other charity for each Qualified Charitable Distribution.
We recommend that you seek advice from your financial advisor prior to making a charitable rollover as personal circumstances can have a significant impact on whether charitable rollovers are advantageous. In order to benefit from an IRA contribution, plan to contact your IRA administrator as soon as possible as some administrators may place a deadline on requesting transfers.