December 21, 2010
One element of the tax bill enacted last week is great news for conservatives. If you are 70½ years of age or older you can make a tax-free gift to The Heritage Foundation from your IRA.
But you have to act quickly to take advantage of this opportunity. Call our call our Gift Planning Office toll-free at (800) 409-2003 to learn more.
For tax year 2010, you may again make tax-free gifts directly to qualified charities directly from your traditional or Roth IRAs, in any amount up to $100,000. If you are married with separate IRAs, you and your spouse can each make gifts up to $100,000.
Let me give you an example of how this might work. Gary is a retired businessman and a long-time Heritage member. His retirement plan has grown substantially. Since Gary had all the income he currently needed, he decided to make a gift of $5,000 from his IRA to Heritage. He called his custodian and requested a transfer of $5,000. It was easy for Gary to make the gift and he liked the fact that he could help Heritage without increasing his taxes.
What you need to know
- The law is applicable in 2010 and 2011. You may make a maximum gift from your IRA of $100,000.
- Your gift must be made directly from your IRA to Heritage in order to qualify. Contact your IRA custodian about how to make a transfer.
- You will not receive a charitable income tax deduction for this type of gift. However, because these gifts do not fall under normal deduction rules, it means you can make gifts in excess of the 50 percent of Adjusted Gross Income ceiling for cash gifts.
- Gifts must be made before January 31, 2011 to qualify toward the 2010 taxable year, though we encourage you to make a gift in 2010 if possible. Donors should contact their IRA custodians directly about making a transfer, and extra time should be allowed to process the request before year end.
- Keep in mind that everyone’s circumstances are different, and state as well as federal income, gift, and estate tax laws may affect your plans. Check with a qualified tax advisor to learn about your IRA charitable rollover tax benefits.