Give from your IRA
You can receive a tax benefit if you make a charitable donation from your IRA in a provision included in the American Taxpayer Relief Act of 2012 which Congress approved on January 1, 2013.
You can qualify for this benefit if you have an IRA and if you are 70 1/2 or older.
For the 2012 tax year
You can give up to $100,000 from your IRA to charity. Here are three ways this can happen for the 2012 tax year:
- Some individuals made charitable distributions from an IRA in 2012 with the hope that the law would be retroactive. These gifts are now qualified back to January 1, 2012.
- Individuals can still make qualified charitable distributions from IRAs for the 2012 tax year if they are made by January 31, 2013. If you wish to do this, send a check directly to the charity, designating it for the 2012 tax year.
- If an individual received an IRA Required Minimum Distribution (RMD) in December 2012, he or she may give any portion of that RMD to a charity, as long as it is done by January 31, 2013, to count as a 2012 gift. The charity will send a letter confirming the gift and the amount is not reported as income for 2012.
For examples of how IRA distributions and charitable gifts may benefit you, visit the Crescendo website page for "Explanation of January 2013 IRA Gifts."
For the 2013 tax year
Individuals can give up to $100,000 if the gift is made by December 31, 2013; the gift must go directly from the IRA to the charity.
Information provided by Everence, Goshen, Ind.