Consider Making a Charitable Gift from Your IRA

Using an IRA to make a charitable donation can help a worthy cause and is also tax-advantaged. The best strategy for IRA giving depends on your age and other financial plans.

Using an IRA to make a charitable donation can help a worthy cause and is also tax-advantaged. The best strategy for IRA giving depends on your age and other financial plans.

 

If you are over age 70 ½, you can give directly from your IRA.
A Qualified Charitable Distribution or “QCD” is a direct transfer from your IRA account to a charity, like the Community Foundation of Greenville. A gift from your IRA – in any amount – can benefit your favorite cause, like the arts or education. Your gift can benefit a specific nonprofit, or add to the Community Foundation’s unrestricted funds for needs in our community.

Giving from your IRA is tax-advantaged. Here are some guidelines to keep in mind:

  • You can give using QCDs as soon as you are 70 ½, even though you aren’t required to draw on IRA assets until age 72.
  • Using QCDs, you can give up to $100,000 each year. If you file taxes jointly, your spouse can also give up to $100,000 from their IRA.
  • QCDs count toward your required minimum distribution (RMD). Giving more than your RMD is fine, but there’s no carry over to next year’s RMD.
  • QCDs are excluded from taxable income, likely reducing the taxes you owe even if you do not itemize deductions.
  • Under the tax rules, the first dollars distributed from your IRA are earmarked to
    satisfy your RMD. It’s smart to make charitable distributions before taking income
    for yourself.
  • QCD gifts can’t be contributed to a donor advised fund, but the Community Foundation offers other options for supporting your favorite cause or organization.

How you can give from your IRA later:
If you’re not ready (or not old enough) to use IRA assets for giving today, you can still make an impact. Simply name the Community Foundation of Greenville as an account beneficiary to receive all or a percentage of your account upon your death. We will work with you to customize a giving plan for your charitable interests and you’ll become part of the Legacy Society, our way of acknowledging donors who plan for a gift to the Community Foundation from their estate.

Giving from your IRA is almost always a smart choice. Still, it’s important to know how a gift works for your circumstances. We are glad to partner with you and your advisors to ensure the outcome you want. Contact Gina Blohm for more information at 864-331-8418.

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