Benefits include:
See below for more information regarding the SECURE ACT 2.0 implications.
A Qualified Charitable Distribution (QCD) is a transfer or distribution from an IRA made directly to The Foundation, as an eligible charity, bypassing the owner of the account. These distributions can be made from a Traditional IRA or an Inherited IRA.
Owners of Individual Retirement Accounts who are at least age 70 1/2 can contribute some or all of their IRAs to charity up to $100,000. Beginning in 2024, this amount will now be adjusted for inflation.
Moreover, for those who are at least 73, QCDs count toward the IRA owner's required minimum distribution (RMD) for the year.
As background, SECURE 2.0’s provisions build on the original SECURE Act of 2019 (“SECURE” stands for “Setting Every Community Up for Retirement Enhancement). SECURE 2.0 includes the Qualified Charitable Distribution (QCD) enhancements that have been in the works for many months.
Here are three key provisions affecting philanthropists in the new law:
Source: Wealthmanagment.com
IRA Charitable Rollover to a Charitable Gift Annuity
This will allow you to receive lifetime payments to boost your retirement income or provide a lifetime payment for you or your spouse.
Click here for more on Charitable Gift Annuities.
Source: Fidelity.com
First, contact your IRA administrator and see if they have a form that you can use to make an IRA direct charitable gift request. If that is not available, clicking on the button above will offer a sample letter that can be used to request a direct distribution from an IRA (Individual Retirement Account) to your church or favorite charity. (This sort of gift is only available to individuals who are over age 70 1⁄2.)
You may print the sample letter and simply fill in the applicable fields by hand or retyping.
Fill in the relevant fields as follows:
You should keep a copy of the letter for your records.
This sort of gift may be new to some churches and charities. To ensure that you are provided an appropriate gift receipt letter, The Foundation is happy to issue the Gift Acknowledgement letter to you for your tax records.
Please remember that this sort of gift is not income to you and, therefore, it is not tax deductible. The Charitable Distribution reduces your Adjusted Gross Income thus providing a tax benefit. The gift counts toward your Required Minimum Distribution (RMD) and is a great option for anyone who does not itemize charitable deductions and/or anyone who does not want to incur that additional RMD income.