Charitable IRA Rollover Distributions

Donors aged 70½ or older can make tax-free IRA distributions by making a special gift to charity.

November 9, 2018 - Author: Abbey Miller, Michigan 4-H Foundation

For more information contact Amanda Masters, amasters@msu.edu.

Qualifying donors can make tax-free IRA distributions by making a special gift to charity, like Michigan 4‑H!

Donors aged 70½ or older may donate up to $100,000 to charity each year by transferring an amount directly from an IRA to that charity and thereby reducing their taxable income for the current tax year. How, why and key notes:

  • Instruct your IRA custodian to distribute a gift amount directly to the Michigan 4-H Foundation or Michigan State University. The entire gift amount qualifies as a charitable distribution.
    The gift amount is not included in your personal income for federal taxes.
  • The gift amount can count toward the required minimum distribution (RMD) for the tax year.
  • Distribution cannot be considered an income tax charitable deduction. The gift is considered a tax-free gift because the donor doesn’t pay taxes on the distribution if it’s made directly to a charity.
  • Distributions can be made only from traditional individual retirement accounts or Roth IRAs. Typically, 403(b), 401(k), pension and other retirement plans are ineligible for the tax-free distribution.

For more detailed information, contact Amanda Masters at 517-884-4691 or by e-mail at amasters@msu.edu.

Remember, this opportunity ends Dec. 31 for current year tax credit.

Tags: giving


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