Photo: Tim Cotter.

What does it look like to make a charitable IRA gift?

Oct 21, 2019 by Jana Hemphill
Former board member Larry Weinberg shares his experiences making a charitable IRA gift to the Deschutes Land Trust.

Questions? Contact our team!

Do you have questions, kudos, or other feedback? Let us know: info@deschuteslandtrust.org

You may have recently noticed the Land Trust talking about making charitable gifts through your traditional Individual Retirement Account (IRA). For those who don’t know, if you are 70 1/2 or older, you can make a charitable gift from your IRA without counting those gifts as part of your Adjusted Gross Income (AGI).

But what does this look like in practice? And does it make sense for you? Here are some thoughts from former board member Larry Weinberg, who makes charitable gifts through his IRA. Please note that since there are requirements and conditions to receiving the benefits of a Qualified Charitable Distribution (QCD), Larry recommends talking to an attorney or your financial advisor about your options.

Larry Weinberg volunteering at Camp Polk Meadow Preserve.
Larry Weinberg volunteering at Camp Polk Meadow Preserve.
1. Why do you support the Deschutes Land Trust? Why do you support us through a charitable IRA gift?

I volunteer at the Land Trust and have also been on the board. Your mission is something I can connect with. Previously, I was making monthly donations to the Land Trust and I was quite happy with it. When federal regulations were changed recently, I could have continued to make my monthly gifts, but I gained a benefit for giving through my traditional IRA.

While some people have an advantage with giving through their IRA in regards to the standard deduction on their taxes, it didn’t help me personally. However, because this affects your AGI, it can impact your medicare and prescription medicine premiums. In addition, Oregon state income taxes are based on your federal AGI and you could get better treatment. For me, lowering my AGI by giving through my IRA has been beneficial.

 

2. Is making a gift through your IRA easy? How does it work for you?

The ease really depends on who your IRA custodian is and what their procedures involve. For me, it was a real pain at the beginning because they still used paper forms. Now, it’s pretty easy! I can do it online. I enter the amount of my gift and the name of the charity, then ask them to send the check to me. I make a copy of the check for my records and then send the check to the nonprofit. After I receive my tax-deductible receipt, I leverage my gift to get a matching gift for the nonprofit through my former employer.

You'll also need to decide whether you want withholding or not. If you say not to do withholding, the full amount of the gift is given to the nonprofit. Otherwise, your withholding is taken out of the amount you requested for the nonprofit. Keep this in mind if you need to withhold additional funds with the reminder of your required minimum distribution.

 

3. What are the benefits of making a gift through your IRA?

I mentioned many of the benefits previously. The other thing to keep in mind is if you need to take a Required Minimum Distribution (RMD) from your IRA, you can have part of it be a donation. If you do not have an RMD yet, you can withdraw a charitable gift and it will make your RMD lower when you are required to withdraw from your IRA.

 

Thank you Larry, for your first-hand details about charitable IRA gifts!

 

Please note: The Deschutes Land Trust can provide information about charitable giving through your IRA, but we cannot provide legal or tax advice. We encourage you to seek independent financial assistance.

The Deschutes Land Trust is recognized by the IRS as a 501(c)3 tax exempt, publicly supported organization. Contributions are tax deductible to the extent of the law. Our tax ID is 93-1186407.

 

Learn more: