IRA Charitable Rollover

A Tax Smart Way to Give

If you are 70 1/2 or older, you may transfer up to $100,000 directly from your IRA to charitable organizations each year, without counting the distributions as taxable income. Additionally, if you are 72 or older, your IRA Charitable Rollover gift (also known as a Qualified Charitable Distribution) counts toward satisfying your required minimum distribution each year.*

An IRA Charitable Rollover gift is easy to make, and there is no minimum gift amount. Simply contact your IRA administrator to learn how to initiate a direct transfer from your account to the MFA.

Although these gifts do not qualify for a traditional charitable deduction, they are in effect 100% deductible if counted against your RMD because they are not included in taxable income. Therefore, this can be a particularly tax-effective way to make a gift to the MFA if you no longer itemize.

Retirement plans are among the most highly taxed assets one can own, subject to income tax in life, estate tax at death, and income tax when left to an individual other than a spouse. By making charitable gifts from your IRA account, you can leave more tax-efficient assets for your heirs.

As in all charitable gift decision-making, review with one’s advisor is encouraged. There may be additional limitations if you make contributions to your IRA after age 70.

For more information, please call 617-369-3193.

* If you make contributions to your retirement account after age 70, there may be limitations to counting your IRA charitable distributions against your RMD. Ask your accountant or financial advisor for more information.