November 21, 2018
If you are age 70 and ½ and older, consider using your IRA to make a gift to Mars Hill University.
According to Vice President for Advancement Bud Christman, “Using an IRA is one of the best, most efficient ways to make a charitable gift. An IRA gift transfer is a ‘non-taxable’ event that enables donors to direct their IRA Required Minimum Distribution (RMD) to assist Mars Hill students with their educational goals.”
See below for more information:
IRA Charitable Rollover Gifts
This summary describes the important advantages and steps in making a charitable gift from your IRA.
Legislation enacted in December 2015 authorized charitable gifts from IRAs for 2016 and future years. Among the provisions of the bill is an exclusion from gross income for income tax purposes of up to $100,000 (per IRA account owner) for “qualified charitable distributions” from an Individual Retirement Account (IRA). The distribution will count toward an individual’s Required Minimum Distribution (RMD). The statutory requirements for a “qualified charitable distribution” are as follows:
Frequently Asked Questions:
May I make a gift from my IRA if I have already taken my required minimum distribution (RMD)?
Yes. You can exclude up to $100,000 (per IRA account owner) from gross income for qualified charitable donations. The donation counts toward your RMD but is not limited by your RMD.
May I contribute more than $100,000 to a qualified charity from an IRA?
Yes, however, the law limits the exclusion from gross income to $100,000. Charitable contributions from an IRA in excess of the $100,000 must follow the general rules pertaining to percentage limitations and itemized contribution reductions.
Are IRA distributions already taken by me eligible to gift as qualified charitable distributions?
No. However, you can make gifts from IRA distributions that do not meet the requirements of a
qualified charitable distribution. In such cases, the IRA distribution would be recognized as income for income tax purposes and typically would be eligible for a federal income tax charitable deduction.
Is my IRA charitable rollover gift eligible for an income tax charitable deduction?
No. Donors of qualified IRA gifts do not receive a federal income tax charitable deduction for the IRA gift, as they are not being taxed on the withdrawal.
Are there other tax advantages to gifting through a qualified IRA?
Yes! Qualified IRA gifts are not subject to percentage of adjusted gross income (AGI) limitations for charitable contributions and are not reportable as income for federal income tax or for Social Security income purposes. The amounts withdrawn are not subject to state income taxes in most states. Donors who do not itemize deductions on their federal income tax returns may benefit from qualified IRA gifts for their exclusion from gross income. Amounts withdrawn from an IRA account are removed from the donor’s taxable estate. Talk to your tax advisor to see which benefits apply to your specific situation.
What types of charitable gifts are not eligible for IRA rollover gifts?
Most gifts to a private foundation, donor-advised fund, or supporting organization are not eligible. Gifts to a charitable remainder trust, lead trust, pooled income fund, or charitable gift annuity are not eligible. Gifts for which the donor receives a benefit that reduces the donor’s tax deduction (such as tickets or dinner) are not eligible.
Are gifts from retirement plans other than an IRA eligible?
No. However, donors may be able to make qualified transfers from their pension or retirement plan to their IRA, and then make a charitable gift from their IRA account.
Mars Hill’s Legal Name and Tax ID
Legal Name: Mars Hill University, Inc.
Tax ID: 56-0554207
Vice President for Advancement
Mars Hill University
P.O. Box 6792
Mars Hill, NC 28754
This is not intended to be legal or tax advice. We encourage you to consult your own legal or tax advisor.