EXTENSION OF IRA LAW PROVIDES PHILANTHROPIC TAX ADVANTAGES FOR 2010 & 2011
The Tax Relief Act passed by Congress in December 2010 permits individuals aged 70½ and older to move up to $100,000 from their IRAs directly to qualified charities in 2010 and 2011 without having to pay income taxes on the money.
Details for WKU Alumni & Friends to be aware:
- The donor has to be at least 70½ years of age
- The gift must be made directly from the IRA to WKU (donors should ask their IRA custodians for special forms to make this request)
- The provision allows for a maximum distribution of $100,000 in each year
- 2010 IRA rollover gifts can be made through January 31, 2011
- The distributed amount is excluded from income; therefore no charitable deduction is claimed
- The rollover satisfies the IRA required minimum distribution
A qualified distribution must be made directly by the IRA trustee to charitable organizations like WKU. Thus, a distribution made to an individual, and then rolled over to a charitable organization, would not be excluded from gross income.
Also, only standard IRAs and Roth IRA accounts qualify under this law; other retirement accounts such as 401(k), 403(b), SEP, KEOGH, and SIMPLE IRA plans cannot be used to make an IRA rollover gift. Please consult your financial advisor to confirm whether your retirement account qualifies.
For more information, please contact Diana Kinslow, John Paul Blair or Alex Downing in WKU’s Office of Planned Giving toll free at 1-888-WKU-ALUM (1-888-958-2586).
Note: This is simply a summary of the legislation. Please consult your tax advisor if you would like to consider this type of charitable gift in 2010 and 2011.
