Contact your IRA administrator. Because of the popularity of the rollover, most administrators provide forms and a procedure to help you make a rollover gift.
You can direct a transfer of up to $100,000 to be made this year from your IRA to a qualified charity.
You will pay no income taxes on the amount transferred.
Note: Because you are not claiming the transferred amount as income, you will not receive an income tax deduction for your gift.
Please contact us to let us know how you would like your gift to be used.
Are you frustrated by the required minimum distribution rules?
You must withdraw a portion of your IRA each year based upon your age.
You must pay income tax on the portion you withdraw.
You will face stiff penalties if you fail to withdraw your RMD.
By taking a distribution from your IRA this year, you will likely pay more in taxes and may even reach a higher tax bracket.
You may not be aware that Congress passed a law that gives you another option for your IRA withdrawal. While you must withdraw a certain amount of money from your IRA each year, the IRA charitable rollover gives you a way to avoid paying income taxes and still meet your RMD.
Rolling over part of your IRA’s “required minimum distribution” or “RMD” to New Braunfels Community Foundation can help reduce your tax bill while supporting your favorite charities.
Example:
“Margaret” was a retired librarian. She volunteered at her favorite charity several times a week and also made several donations to the nonprofit each year. Margaret saw that her taxes were increasing and wondered how she could continue to do extra things like make charitable gifts with lower income.
Margaret: I have been fortunate that I could make gifts to charity every year. My financial advisor told me that because I was turning 70½ this year, I would have to begin taking distributions from my IRA. He also told me that because my income was increasing, my tax rate would too.
I started looking at ways to save money and reduce my taxes. I learned that I could reduce my income and my taxes by transferring money directly from my IRA to New Braunfels Community Foundation for the purpose of supporting the causes that I am the most passionate about.
An individual who is age 70½ and older must take a “required minimum distribution” from his or her IRA each year. With the IRA charitable rollover, these individuals can transfer up to $100,000 per year directly to charity and it satisfies their required minimum distribution.
Margaret called her IRA custodian and requested a transfer of $10,000 from her IRA directly to New Braunfels Community Foundation.
Margaret: I knew that I would never use all of the money in my IRA. I was thrilled to learn that a gift from my IRA could reduce my income taxes this year while helping my favorite nonprofit.
Give us a call at 830-606-9536 or via email at brit@nbcommunityfoundation.org if you have any questions about IRA charitable rollovers or other ways that the New Braunfels Community Foundation can assist you with your philanthropy.