5 Reasons to Donate from Your Retirement Plan

IRA Charitable Rollover

If you are 70 ½ or older, you can make gifts up to $111,000 as your Qualified Charitable Distribution (QCD). This is a direct transfer from your IRA to a qualified charity and is a tax-free donation. Further, this can be used to fund a Charitable Gift Annuity.

Offset Estate Taxes

If the value of the donated assets is included in your gross estate, you are entitled to a charitable tax deduction when your IRA is donated. This includes offsetting taxation that your heirs would be susceptible to. If your retirement plan is passed on to your heirs, they could be liable for 50% or more in taxes. However, if your IRA is passed on to a qualified 501(c)(3), there is no income or inheritance tax and your heirs can receive other assets with lower tax rates.

Count Towards Your RMD

If you are 73 or older, you must take a Required Minimum Deduction from your retirement plan every year. When this deduction is donated, it counts as a QCD and eliminates income taxes that you would otherwise pay on the distribution. This may be done up to $111,000.

Simple and Flexible

When you are ready to make a donation, all you generally need to do is fill out a beneficiary form provided by your employer or retirement plan administrator. Additionally, you don’t need to send all of the distribution to a charity, and it doesn’t need to all go to one charity. The donation can be distributed however you please.

Support Your Passions with No Direct Cost

Donating retirement assets is not just a convenient tool for tax savings. Your donation would be a direct investment in the causes you most cherish and would shape your legacy for future generations. You’ve worked hard to build those assets. How do you want to use them to help write your values onto the world?

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