HOW IT WORKS
You work with your IRA administrator to transfer up to $100,000 from your IRA directly to the community foundation.
You must be 70½ or older at the time the gift is made. If married, each spouse can transfer up to $100,000 from their IRA. We handle all the administrative details. Your gift can be placed into an endowment that is invested over
time. Earnings from your gift are used to make grants addressing community needs. Your gift—and all future earnings from your gift—is a permanent source of community capital, helping to do good work forever.
Wondering how to direct your IRA to make a difference in your community? The Otsego Community Foundation may have the solutions you are looking for. If you are over 70½, you can transfer up to $100,000 directly
from your individual retirement account (IRA) to the Otsego Community Foundation tax-free. If you are 72 or older, this gift will count toward your required annual minimum distribution. Many people have found this an easy, tax-smart way to support the community they love.
HOW TO GIVE IRA ROLLOVER OR QUALIFIED CHARITABLE DISTRIBUTION
If your gift meets the fund minimum of $20,000, you have the opportunity to create a charitable fund in your name, the name of your family, or in honor of any person or organization you choose. Select one of the following fund types:
- FUND FOR THE COMMUNIUTY: Address a broad range of current and future needs. The community foundation awards strategic grants to select projects and programs.
- FIELD OF INTEREST FUND: Target your gifts to causes that are important to you. The community foundation awards grants to programs addressing your specific interest area.
- DESIGNATED FUND: Support the good work of a specific nonprofit organization with a source of income, plus planned giving and investment management services.
We can make your charitable IRA transfer easy, flexible and effective, helping you achieve your personal charitable goals and financial goals. Distributions can help satisfy your required minimum distribution and reduce your taxable income. Your qualified charitable distribution incurs no federal income tax and the asset is no longer part of your estate for tax purposes. Many donors also like that this tool allows them to make a significant gift during their lifetime so that they can see results, rather than making the gift through an estate plan. Any amounts left in an IRA when an individual dies may be taxed as income to the beneficiary and are also considered assets for the purpose of calculating that person’s estate tax liability. When you give your IRA to charity, your heirs are not burdened by the taxes associated with receiving your IRA upon your death. Instead, you can leave them other assets that have a more favorable tax treatment.
In legislative news, a recent flurry of activity in the Senate has inched forward the legislation known as SECURE 2.0. Philanthropists and their advisors are watching this legislation closely because of the proposed inclusion of provisions that would adjust the annual $100,000 Qualified Charitable Distribution (“QCD”) cap for inflation and allow a one-time, $50,000 QCD to a charitable remainder trust or other split-interest gift. It’s impossible to predict what might happen when the House and Senate bills are combined and reconciled and then brought to a final vote. If we were forced to speculate, we’d guess that the legislation will pass late this year, the QCD enhancements indeed will make it into the final bill, and the legislation will be signed into law later this year. Our fingers are crossed, as no doubt yours are as well, because we are huge fans of the QCD and its ability to unlock charitable dollars.
Contact us to learn more about the ways we can help you have a positive impact on the community and causes you care about.
Otsego Community Foundation