Make a Gift Tax-Free With An IRA
A Tax-Saving Way to Help the University of Western Connecticut Foundation
If you are 70½ years old or older, you can take advantage of a simple way to benefit the University of Western Connecticut Foundation and receive tax benefits in return. You can give up to $100,000 from your IRA directly to a qualified charity such as ours without having to pay income taxes on the money. This popular gift option is commonly called the IRA Charitable Rollover, but you may also see it referred to as a qualified charitable distribution, or QCD for short.
Why Consider This Gift?
- Your gift will be put to use today, allowing you to see the difference your donation is making.
- You pay no income taxes on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your deductions.
- Beginning in the year you turn 72, you can use your gift to satisfy all or part of your required minimum distribution (RMD).
- Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.
Frequently Asked Questions
- I've already named the Western Connecticut State University Foundation as the beneficiary of my IRA. What are the benefits if I make a gift now instead of after my lifetime?
A. By making a gift this year of up to $100,000 from your IRA, you can see your philanthropic dollars at work. You are jump-starting the legacy you would like to leave and giving yourself the joy of watching your philanthropy take shape. Moreover, you can fulfill any outstanding pledge you may have made by transferring that amount from your IRA as long as it is $100,000 or less for the year.
- I'm turning age 70½ in a few months. Can I make this gift now?
A. No. The legislation requires you to reach age 70½ by the date you make the gift.
- I have several retirement accounts—some are pensions and some are IRAs. Does it matter which retirement account I use?
A. Yes. Direct rollovers to a qualified charity can be made only from an IRA. Under certain circumstances, however, you may be able to roll assets from a pension, profit sharing, 401(k) or 403(b) plan into an IRA and then make the transfer from the IRA directly to the Western Connecticut State University Foundation. To determine if a rollover to an IRA is available for your plan, speak with your plan administrator.
- Can my gift be used as my required minimum distribution under the law?
A. Yes, absolutely. Beginning in the year you turn 72, the IRA charitable rollover gift can satisfy all or part of your RMD.
- When do I need to make my gift?
A. We must receive your gift by Dec. 31 for your donation to qualify this year. If you have check-writing privileges on your IRA account, please mail your check by Dec. 20 in order to give us time to process your gift before the end of the year.
- Do I need to give my entire IRA to be eligible for the tax benefits?
A. No. You can give any amount under this provision, as long as it is $100,000 or less this year. If your IRA is valued at more than $100,000, you can transfer a portion of it to fund a charitable gift.
- I have two charities I want to support. Can I give $100,000 from my IRA to each?
A. No. Under the law, you can give a maximum of $100,000. For example, you can give each organization $50,000 this year or any other combination that totals $100,000 or less. Any amount of more than $100,000 in one year must be reported as taxable income.
- My spouse and I would like to give more than $100,000. How can we do that?
A. If you have a spouse (as defined by the IRS) who is 70½ or older and has an IRA, he or she can also give up to $100,000 from his or her IRA.
For Those 59 ½ Years or Older
If you’re at least 59 ½ years old, you can take a distribution and then make a gift from your IRA without penalty. If you itemize your deductions, you can take a charitable deduction for the amount of your gift.
At Any Age
No matter your age, you can designate Western Connecticut State University as the beneficiary of all or a percentage of your IRA and it will pass to us tax-free after your lifetime. It’s simple, just requiring that you contact your IRA administrator for a change-of-beneficiary form or download a form from your provider’s website.
TIP: It’s important to let us know of your gift because many popular retirement plan administrators assume no obligation to notify a charity of your designation. The administrator also will not monitor whether your gift designations are followed. We would love to talk to you about your intentions to ensure they are followed and to thank you for your generosity.
- Contact Julie Pryor-Bennett at 203-837-8111 or firstname.lastname@example.org to discuss using your IRA to support WCSU and its mission.
- Seek the advice of your financial or legal advisor.
- To include WCSU in your plans, please use our legal name and federal tax ID. Please let us know of your gift so that we can thank you and ensure your intentions are followed.
Legal name: Western Connecticut State University Foundation, Inc.
Legal address: 181 White Street, Danbury, CT 06810
Federal tax ID number: 06-1086725
The information on this website was accurate at the time of posting and is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor.