Time is Running Out for IRA Charitable Distributions
Time is running out for those who are 70-and-a-half or older to make qualified charitable distributions from their IRAs. In late summer 2008, the U.S. Congress passed a continuance of legislation established in 2006 that allows an individual to make distributions from an IRA up to $100,000 total each year to qualified ministries or charities for tax years 2008 and 2009.
Robert Kuhlman, principal of Central Lutheran School in St. Paul, shares how IRA gift distributions enabled long-time supporters to make a $100,000 gift that accomplished their desire to support student aid. “After [attending] a charitable giving seminar and [learning] of this gifting method, a couple came to me wanting to make gifts that would benefit the school (for students needing assistance to attend) and their own church’s endowment fund (to send students to the school).”
The current recession has caused dramatic declines in the value of an individual’s IRAs, and the U.S. Congress has suspended the required minimum distribution (RMD) for 2009. With those two factors, the number of people who are eligible to utilize this opportunity to give from their IRAs is down considerably from the previous three years.
With the stock market seemingly in the process of some sort of recovery the past several months, there is still time before the end of the year for those eligible to make IRA distributions to their church, Metro Lutheran endowment fund, social ministries, colleges, seminaries, church bodies, and other church-wide ministries. Giving from an IRA enables an individual to experience the joy of giving more substantial gifts than she or he may give from annual income or savings.
If you are interested in making charitable gifts from your IRA, contact your administrator to fill out information needed to assure they make the distribution directly to the ministry or charities of your choice. You need to provide the tax ID number for each organization you want to benefit. They will send you a 1099 to report the distribution on your 2009 income tax return. Your tax preparer will need to indicate on your return that this was a qualified charitable distribution, eliminating the income tax you would normally pay on the distribution.
For more information or assistance in charitable gift planning, contact your church body foundation or the development office at one of your favorite ministries.
Glenn Thiel, CFRE, CDE, is a retired Gift Planning Counselor after 29 years serving the LCMS Foundation, St. Louis, Missouri. In retirement Glenn is serving as an independent gift-planning consultant. Glenn can be contacted by phone at 952/223-2154 or 612/718-4541 or by e-mail at email@example.com.