Giving Through an IRA Charitable Rollover
Are you or someone you know age 70 ½ or older?
The IRA Charitable Rollover lets individuals age 70½ and older make a meaningful gift during their lifetime. Donors can contribute a qualified charitable distribution directly from their IRA to a qualifying charity—such as the DeKalb County Community Foundation—without counting the distribution as taxable income.
Support your charitable interests in the community with a tax-free gift of up to $100,000 from your IRA to the Community Foundation.
Benefits of IRA Rollover Gifts:
- Your charitable gift costs less by using pre-tax IRA assets.
- The IRA Charitable Rollover is exempt from income taxes.
- Use your IRA Charitable Rollover to satisfy your required minimum distribution (RMD) and lower your taxable income for the year.
IRA Charitable Rollover Giving Options
Your gift can establish a new charitable Fund or support an existing one, including:
- Community Impact Funds
These offer the broadest giving option, allowing grants to address the greatest needs as identified by our Board and staff. Supported programs include Community Needs Grants, Emergency Grants, and incentive pools for Give DeKalb County. - Designated Funds
Support specific eligible organizations, with the Foundation ensuring grants remain relevant and responsive over time. - Field of Interest Funds
Focus on particular causes or areas, such as youth, elderly, literacy, food security, or specific geographic regions that matter to you. - Scholarship Funds
Create opportunities for students to pursue further education and professional development. Donors can set eligibility criteria, select committees, schools, and fields of study.
NOTE: IRA Charitable Rollovers may not be used to support Donor Advised Funds.
Who Should Consider an IRA Charitable Rollover?
- Individuals age 70 ½ and older who have more money in their IRA than needed for daily living expenses and long-term care.
- Spouses who both have IRA accounts and do not need the income for daily living expenses. Each spouse can transfer up to $100,000 tax-free from their IRA.
- Generous donors who may give more to charity than they can deduct in a tax year (IRA Charitable Rollovers are exempt from federal income taxes).
- Donors who do not itemize deductions but regularly contribute a portion of their income to charity.
- Individuals who wish to gift up to $100,000 from their taxable estate.
Next Steps:
- Consult your professional advisor to see if the IRA Charitable Rollover is the right option for you.
- Download and complete a sample request letter to send to your IRA Plan Administrator.
- Notify the DeKalb County Community Foundation of your gift by completing and returning our sample notification letter.
Frequently Asked Questions
- Why do donors give IRA assets to their community foundation?
After decades of deliberate saving, some of today’s retirees have more money in their IRAs than they need for daily living expenses and long-term care. For larger estates, a good portion of IRA wealth goes to estate taxes and income taxes of non-spousal beneficiaries; heirs may receive less than 50 percent of IRA assets passed on to them through estates. Instead, IRA holders may leave their IRAs to qualified charitable organizations such as the DeKalb County Community Foundation—choosing charity over taxes.
- Why do donors give IRA assets to their community foundation?
- What are the tax implications of an IRA charitable rollover gift?
Because the transfer occurs directly from your IRA to a qualified charity, you pay no income tax on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your tax deductions. The gift can satisfy all or part of your required minimum distribution (RMD) for the year.
- What are the tax implications of an IRA charitable rollover gift?
- To what charities can an IRA charitable rollover be made?
IRA charitable rollovers must be made directly to a 501(c)(3) organization, such as the DeKalb County Community Foundation.
- To what charities can an IRA charitable rollover be made?
- Are there any IRA transfers to the community foundation that DO NOT qualify for preferred tax treatment?
Yes. Transfers to supporting organizations and Donor Advised Funds do not qualify. Also, IRA charitable rollover transfers cannot be made to charitable annuities, charitable lead trusts, and charitable remainder trusts. Because such transfers do not count as qualified distributions under these special rules, the donor must first recognize those distributions as income. The donor’s charitable deduction must be calculated as a regular itemized deduction.
- Are there any IRA transfers to the community foundation that DO NOT qualify for preferred tax treatment?
- How can an IRA gift be made?
Typically, IRAs are held by a financial service or trust company. Please contact your IRA administrator directly to initiate the transfer to the DeKalb County Community Foundation.
- How can an IRA gift be made?
For questions or more information about IRA Charitable Rollovers, please contact Executive Director Dan Templin at 815-748-5383 or dan@dekalbccf.org.
