GIVE BY IRA CHARITABLE ROLLOVER
If you are 70½ years old or older, you can take advantage of a simple way to benefit EndCAN and receive tax benefits in return. You can give any amount up to $100,000 per year from your IRA directly to a qualified charity such as ours without having to pay income taxes on the money. This popular gift option is commonly called the IRA charitable rollover, but you may also see it referred to as a qualified charitable distribution, or QCD for short. Click here for a sample transmittal letter.
WHY CONSIDER AN IRA CHARITABLE ROLLOVER?
- Your gift will be put to use today, allowing you to see the impact your donation is making.
- You pay no income taxes on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your deductions.
- If you reached the age of 70½ on or before Dec. 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution (RMD) for the year. If you turn 70½ on or after Jan. 1, 2020, you can use your gift to satisfy all or part of your required minimum distribution starting at the age of 72. (Note: The RMD requirement has been waived for 2020, per the CARES Act signed into law on March 27, 2020.)
- Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.
FAQs
Q. I’m turning age 70½ in a few months. Can I make this gift now?
A. No. The legislation requires you must reach age 70½ by the date you make the gift.
Q. I have several retirement accounts—some are pensions, and some are IRAs. Does it matter which retirement account I use?
A. Yes. Direct gifts to a qualified charity can be made only from an IRA. Under certain circumstances, however, you may be able to roll assets from a pension, profit sharing, 401(k) or 403(b) plan into an IRA and then make the transfer from the IRA directly to EndCAN. To determine if a rollover to an IRA is available for your plan, contact your plan administrator.
Q. Can my gift be used as my required minimum distribution under the law?
A. Yes, absolutely. If you reached the age of 70½ on or before Dec. 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution (RMD) for the year. If you turn 70½ on or after Jan. 1, 2020, you can use your gift to satisfy all or part of your required minimum distribution starting at the age of 72. Contact your IRA custodian to complete the gift. (Note: The RMD requirement has been waived for 2020, per the CARES Act.)
Q. When do I need to make my gift?
A. EndCAN must receive your gift by Dec. 31 for your donation to qualify this year. If you have check-writing privileges on your IRA account, please mail your check by Dec. 21 in order to give us time to process your gift before the end of the year.
Please contact us at info@endcan.org for additional instructions.
Information contained herein was accurate at the time of posting. The information on this website is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor.
TAX BENEFITS OF THE CARES ACT
The new CARES (Coronavirus Aid, Relief, and Economic Security) Act is designed to help you, businesses and nonprofits facing economic hardship during the coronavirus pandemic. Here are a few key provisions of the CARES Act that may affect you and your charitable goals:
Required Minimum Distributions SuspendedThe new law temporarily suspends the requirements for required minimum distributions (RMD) for the 2020 tax year. This probably comes as a relief to many of you who would have had to withdraw from your retirement accounts. Many donors use their RMD to make a gift from their IRA. Despite the RMD suspension, remember that if you are 70½ or older, you can still make a gift from your IRA or name EndCAN as a beneficiary.
New Tax IncentivesThe CARES Act expands charitable giving incentives and allows taxpayers who take the standard deduction to make up to $300 of charitable contributions to qualified charities this year. You might think that this is a small amount and would not make a difference. But what if all of our donors gave “just” $300? Such support would have a huge impact on those we serve.
For those who do itemize their deductions, the new law allows for cash contributions to qualified charities such as EndCAN to be deducted up to 100% of your adjusted gross income for the 2020 calendar year.