Monday, January 14, 2013

Gift From IRA Could Mean Tax Benefits – For You!

Congress reinstated the IRA Charitable Rollover for 2012 and 2013 as part of the American Taxpayer Relief Act (ATRA) passed on January 1, 2013. If you are 70.5 years or older, you may make a gift up to $100,000 per year to the Jewish Federation of San Diego County from your IRA with no federal income tax impact. To obtain the benefits of the IRA Charitable Rollover for the 2012 taxable year, you must do one of the following:

  • If you received a distribution from your IRA in December 2012, you may make a cash gift to Federation no later than January 31, 2013 and elect to qualify this transfer for exclusion from your 2012 income as a direct qualified charitable distribution pursuant to the provisions of ATRA.
  • If you did not instruct your plan administrator to make a qualified charitable distribution in 2012 (in the hopes that Congress would pass this law), and you would like to do so now, you can instruct your IRA plan administrator to transfer up to $100,000 directly to the Federation no later than January 31, 2013, and it can be a qualified charitable distribution for the 2012 taxable year.
The IRA Charitable Rollover is available through 2013. If you make a qualifying IRA Charitable Rollover in January 2013 and report it as an IRA Charitable Rollover for the 2012 tax year, you are still eligible to claim up to an additional $100,000 in IRA Charitable Rollover contributions in 2013.

We urge you to act soon to take advantage of this opportunity to make your Annual Campaign gift or to create an endowment to support the Annual Campaign or another charitable area for which you are passionate.

Call Lance Yeamen, Donor Services Manager, at 858-571-3444 for additional information. Of course, we encourage you to seek the advice of your professional advisor before you make a charitable IRA Rollover gift.

Additional Details: Unlike a cash withdrawal from your IRA, your direct contribution will be excluded from income for federal purposes and not taxed. It will not be eligible for a charitable tax deduction, but it will not count toward the annual percentage limitation on your other deductible gifts. Your direct contribution cannot be made to donor advised funds, supporting organizations, split-interest trusts or in exchange for gift annuities. Your qualified distribution may be includable in your income for state and local tax purposes, and an offsetting charitable deduction may not be available.

The views expressed here are not intended, nor may they be relied upon, as legal, accounting or other professional advice.


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