The Emergency Economic Stabilization Act
of 2008 included an extension of the IRA Charitable Rollover.
It permits IRA owners who are over age 70½ to make contributions
to charities, such as KETC/Channel 9, directly from a traditional
IRA, up to a limit of $100,000 per individual IRA owner. The
extension is available for the 2008 and 2009 tax years.
Following are some practical tips on using this opportunity
to make tax-advantaged-gifts to KETC/Channel 9. Remember, it
is important to consult a tax advisor about your particular
situation.
- A Qualified Charitable Distribution, or IRA Charitable
Rollover, can count as some or all of your Required Minimum
Distribution – but does not count as income to you
because it is distributed directly to KETC/Channel 9. You
do not take a charitable deduction for the amount transferred
to charity.
- You must be age 70½ on or before the date of the
gift.
- A Qualified Charitable Distribution from the IRA custodial
institution must be payable directly to KETC/Channel 9,
not passed through the donor.
- Qualified Charitable Distributions may not be used to
fund a charitable gift annuity or a charitable trust. However,
it is permissible to pay a pledge with an IRA charitable
rollover as long as the check is payable as noted above.
- The provision applies to traditional IRAs, not to 401(k)s,
403(b)s, SEPs or annuities.
- The individual contribution limit is $100,000 per year
for 2008 and 2009. A married couple, each with an IRA account,
could have rollover contributions totaling as much as $200,000
each tax year.
Example: Taxpayer A has a traditional
IRA with a balance of $100,000. The entire IRA balance is
distributed directly to a group of qualified charities including
KETC/Channel 9. Under the former law, the entire distribution
of $100,000 would be includible in Taxpayer A’s gross
income for tax purposes. Under the present provision, the
entire distribution is a qualified charitable distribution
and none of the distribution is included in the taxpayer’s
income.
Who is most likely to benefit from this provision?
- Individuals who are required to take minimum distributions
from their IRA but,
a) do not want additional taxable income,
b) lose some of their itemized deductions because of their
income level, or
c) do not need distributions for living expenses, and
would rather donate the funds than be taxed on them.
- Non-itemizers
- Individuals who have made KETC/Channel 9 a beneficiary
of IRA assets through estate planning.
You’ve talked with your tax advisor and you
want to make a gift from your IRA. What now?
- First, inform your financial advisor or the custodian
of your IRA account of what you wish to do. Follow the custodian’s
procedures for making the gift.
- In order to accept and acknowledge a gift as coming from
an IRA, the check from the IRA custodian must be payable
to KETC/Channel 9. We also need
the name of the donor, the allocation of the gift (e.g.
operating support, payment of a pledge, etc.) and a statement
that the gift came from a traditional IRA account.
- So that we may properly acknowledge your gift, please
relay this same information to Channel 9, to the attention
of:
Nancy Burchfield
(314)-512-9024
Director of Major and Planned Giving
KETC/Channel 9
E-mail: nburchfield@ketc.org
3655 Olive St.
St. Louis, MO 63108
Thank you for thinking of KETC/Channel 9.
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