IRA Charitable Rollover
The IRA Charitable Rollover, also known as a qualified charitable distribution (QCD), is an excellent way to help Silver Cross Hospital by making a gift to the Silver Cross Foundation and receiving tax benefits in return. As you plan your required minimum distributions for this year, consider using your IRA account to make the most of your charitable giving. You receive a tax benefit even if you take the standard deduction! Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.
It’s important to consider your tax situation before deciding whether to make a charitable contribution from your IRA. Be sure to share this gift plan with your financial advisor.
To Qualify
- You must be age 70½ or older at the time of gift (you have to wait until 6 months after your 70th birthday to make the transfer).
- Transfers must be made directly from a traditional IRA account by your IRA administrator to Silver Cross Foundation.
- Gifts must be outright. Distributions to donor-advised funds or life-income arrangements such as charitable remainder trusts and charitable gift annuities do not qualify.
- Gifts from 401k, 403b, SEP and other plans do not qualify. Ask your financial advisor if it would be right for you to create a traditional IRA account so you can benefit from the IRA Charitable Rollover.
Frequently Asked Questions
What’s the IRS rule? The QCD allows individuals 70½ and older to make direct distributions up to $105,000 per year to 501(c)(3) charities without having to count the distributions as income for federal income tax purposes. For those who are at least 72, QCDs count toward the IRA owner's required minimum distribution (RMD) for the year.
How much can I distribute? $105,000 per year. The distribution must be outright to charity.
From what accounts can I make transfers? Distributions must come from your IRAs directly to the Silver Cross Foundation. If you wish to help us with a gift from another retirement asset such as a 401k, 403b, etc., you must first roll those funds into an IRA. Then you can direct the IRA administrator to distribute the funds from the IRA directly to Silver Cross Foundation.
Can my spouse also make a Qualified Charitable Distribution to Silver Cross? Yes, every individual who is the owner of a traditional IRA can use the Qualified Charitable Distribution for up to $100,000 each year.
I have two charities I want to support. Can I give $105,000 from my IRA to each? No. Under the law, you can give a maximum of $105,000. For example, you can give each organization $50,000 this year or any other combination that totals $105,000 or less. Any amount of more than $105,000 in one year must be reported as taxable income.
When do I need to make my gift? We must receive your gift by Dec. 31 for your donation to qualify this year. Please make check payable to Silver Cross Foundation and mail to 1900 Silver Cross Blvd., New Lenox IL 60451.
How will the Silver Cross Foundation count the gift? We will give you full credit for the entire gift amount. You will also receive a letter, which states that the gift qualifies as a QCD to use for tax reporting purposes.
What is the procedure to execute a QCD? We offer a sample letter you can send to your plan provider to initiate the distribution. Please let your plan administrator know this gift must be sent prior to December 31 to qualify as a charitable distribution for the tax year. Make sure you contact us by phone at (815) 300-7105 when you direct the distribution so we can look for the check from your IRA administrator.
For more information, please feel free to contact Tracy Simons at (815) 300-7113 or tsimons@silvercross.org.
IRA administrators don’t always include the donors’ names on distribution checks. If you’re planning to make a distribution to the Silver Cross Foundation from your IRA, please let us know in advance so we’ll be able to identify your gift. Also let us know if you want your gift used for a particular purpose.
