Anyone over the age of 70 ½ years old can take advantage of IRA charitable rollovers to benefit nonprofit organizations like Reality Changers and receive tax benefits in return. You can give any amount up to $100,000 annually from your IRA directly to a qualified non-profit like ours with zero tax burden. This gift option is often referred to as a qualified charitable distribution, or QCD.
What is an IRA Charitable Rollover?
IRA charitable contributions provide taxpayers with the opportunity to transfer their annual required minimum distributions (RMDs) directly to their favorite charitable organizations. This allows an individual to exclude the distributions from their taxable income while supporting the non-profit of their choice. IRA charitable rollovers are a great option for anyone who wants to donate the extra taxable income from their RMDs.
No matter where you’re at in the tax planning process, know that you’re not alone. Many people feel confused about the rules surrounding qualified charitable distributions, charitable IRA rollovers, and RMDs. It’s important to consult with your legal and financial advisors for guidance on your specific tax situation.
How IRA Charitable Donations Help Reality Changers
When you opt to make donations from IRA to a charity like Reality Changers, you make a direct impact on the lives of young students. We serve youth who will be the first in their families to graduate from college. Our programs support students from diverse backgrounds who are often underrepresented on college campuses. This helps to advance equal opportunities throughout our region and beyond.
With your generous donation, you can make a significant impact on underserved communities. College degrees have a way of opening doors and career prospects for individuals, but our work aims to build equity for families and neighborhoods, too. Our alumni are agents of change. Their work, investments, and involvement in their communities ensures success for future generations of aspiring college students.
IRA charitable donations help fund programs like College Town, which celebrates the diverse identities of students in grades eight through 11. In the program, they learn how their unique strengths can help them rise above challenges and meet goals no matter the obstacle. As first-generation grads will tell you, empathy and understanding can get a person far. We believe everyone deserves the chance to go to college – after all, “College Changes Everything.”
Why Donate from IRA to Charity
On top of helping your favorite non-profits and charities, IRA charitable rollovers have significant tax benefits. When done correctly, charitable donations of retirement assets can actually minimize the income taxes imposed on your estate and your individual heirs. IRA assets go directly to the organization you want to support, so there’s no need to report the qualified charitable donation, or QCD, as taxable income. No taxes will be owed on the QCD, and the assets can be put to good use by your favorite organization.
Some people may also find that the QCD provides greater tax savings than cash donations. This is because your Adjusted Gross Income (AGI) will be reduced. If you’re over the age of 70 ½ and are utilizing the standard deduction, IRA charitable contributions have a number of important benefits. Making donations directly from your retirement accounts that is not greater than the smaller of your required minimum distributions and $100,000, you’ll receive significant tax benefits. You’ll also enjoy knowing that your donations are helping to change the lives of young people. It’s truly a win-win for everyone involved!
How to Make IRA Charitable Contributions
To make your IRA charitable contribution, contact the custodian of your IRA. Follow their procedures to request a QCD. You’ll need to pass along our tax ID, too: 26-3757305. Your IRA custodian will then mail us a check made out directly to Reality Changers. The check should be accompanied by your name and address. Then, we’ll mail you an acknowledgement of receipt. Have further questions? Reach out to Dawn Wensel, our Vice President of Development, at 619-516-2220 or Dawn@RealityChangers.org.