Charitable Tax-Free IRA Gifts
Great News for seniors! Congress has made permanent the law that allows individual’s aged 701/2 and older to make tax-free gifts totaling up to $100,000 per calendar year directly from their IRA to qualified public charities. This includes gifts directed to Elder Climate Action (ECA) through the Conscious Elders Network (CEN), ECA’s parent organization.
This is especially beneficial for donors who might not need their annual required minimum distribution, or who want to make a larger tax-free charitable gift from an IRA. Even better: You do not report the IRA distribution as income. And if you do not itemize your tax deductions, this is very useful. As with other gifts, you can designate the purpose for which the gift is to be used in ECA’s efforts to combat climate change.
To make a tax-free charitable gift from your IRA:
- You must be 701/2 years of age or older when the distribution is made
- Your transfer must go directly from your IRA to CEN with a designation for use by ECA.
- The law allows you to make tax-free transfers from your IRA to a charity or charities totaling up to $100,000 each calendar year. Your spouse may also be eligible to make such gifts up to $100,000 from his/her IRA.
- A charitable rollover gift from your IRA will count toward your minimum distribution requirement.
- Gifts from your IRA may only be used to make an outright gift to a qualified public charity. Tax-free IRA rollover gifts cannot be used to fund a gift annuity, charitable remainder trust, a donor advised fund or a private foundation.
Please remember that tax-free charitable IRA gifts must transfer directly from your IRA to the Conscious Elders Network with a designation for the Elders Climate Action program. To learn more go to the IRS website or contact your tax advisor.