At the end of 2015, Federal Legislation was passed making the IRA direct charitable rollover gift option permanent. If you are 70 ½ years old or older, you can take advantage of this simple way to benefit The Baby Fold and receive tax benefits in return. You can give up to $100,000 from your IRA directly to a qualified charity such as The Baby Fold without having to pay income taxes on the money. This gift may count as all or part of your required minimum distribution (RMD), without including the distribution as personal income. 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.
- You must be 70 ½ or older when the transfer is made.
- The transfer must go directly from your IRA administrator to The Baby Fold.
- Rollover gifts are limited to $100,000 per taxpayer per year. If married, and each spouse has an IRA, then each may gift up to $100,000.
- The gift may count as all or part of your IRA required minimum distribution. If you reached the age of 70 ½ on or before Dec. 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution. If you turn 70 ½ on or after Jan. 1, 2020 you can use your gift to satisfy all or part of your required minimum distribution starting at age 72. (NOTE: THE (RMD) REQUIREMENT HAS BEEN WAIVED FOR 2020, PER THE CARES ACT SIGNED INTO LAW ON MARCH 27, 2020)
- 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.
- The law is applicable solely to make direct gifts to charity, not for planned gifts such as charitable gift annuities or charitable remainder trusts. Gifts cannot go to donor-advised funds or private foundations.
As you plan your charitable contributions for this year, consider using your IRA funds as your charitable gift to The Baby Fold or for paying an existing pledge commitment. It is wise to consult with your tax professionals if you are contemplating an IRA Charitable Rollover gift.
How to make an IRA Charitable Rollover Gift:
- Contact your IRA administrator to transfer your desired amount. Ask if they have forms to request a transfer or use this sample request form.
- The Baby Fold is a 501(c)(3) nonprofit – our tax identification number is 37-0673453.
- Rollover checks should be made payable to The Baby Fold and mailed to:
The Baby Fold
c/o Aimee Beam
VP of Development and Public Relations
108 E. Willow
Normal, IL 61761