If you're 70½+ years, there's a simple way to benefit Ronald McDonald House Charities of San Diego and receive tax benefits in return. You can give any amount up to $100,000 per year from your IRA directly to a qualified charity such as ours, without having to pay income taxes on your withdrawal. This popular gift option is commonly called the IRA charitable rollover, but you may also see it referred to as a qualified charitable distribution, or QCD for short.
Why Consider This Gift?**
- Your gift will be put to use today, allowing you to see the difference your donation is making.
- You pay no income taxes on the gift. It generates neither taxable income nor a tax deduction, so you benefit even if you don't itemize your deductions.
- If you reached the age of 70½ on or before Dec. 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution for the year. If you turn 70½ on or after Jan. 1, 2020, you can use your gift to satisfy all or part of your required minimum distribution starting at the age of 72. (Note: The RMD requirement has been waived for 2020, per the CARES Act signed into law on March 27, 2020.)
- It may also help you avoid the Medicare high-income surcharge.
- 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.
- Gifts of $1,000 will qualify you for membership in our Giving Circles.
You can download a sample IRA Charitable Distribution form to send to your IRA administrator.
Q. I've already named Ronald McDonald House Charities of San Diego as the beneficiary of my IRA. What are the benefits if I make a gift now instead of after my lifetime?+
A. By making a gift this year of up to $100,000 from your IRA, you'll see your philanthropic dollars at work. You're jump-starting the legacy you'd like to leave and giving yourself the joy of watching your philanthropy take shape. And you'll fulfill any outstanding pledge you've made by transferring that amount from your IRA, as long as it's $100,000 or less for the year.
Q. I'm turning age 70½ in a few months. Can I make this gift now?+
A. No. The legislation requires you reach age 70½ by the date you make the gift.
Q. I have several retirement accounts—some are pensions and some are IRAs. Does it matter which account I use?+
A. Yes. Direct gifts to a qualified charity can be made only from an IRA. You may be able to roll assets from a pension, profit sharing, 401(k) or 403(b) plan into an IRA, and then transfer from the IRA directly to Ronald McDonald House Charities of San Diego. To determine if a rollover to an IRA is available for your plan, speak with your plan administrator.
Q. Can my gift be used as my required minimum distribution?+
A. Yes, absolutely. If you reached the age of 70½ on or before Dec. 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution for the year. If you turn 70½ on or after Jan. 1, 2020, you can use your gift to satisfy all or part of you required minimum distribution starting at the age of 72. Contact your IRA custodian to complete the gift. (Note: The RMD requirement has been waived for 2020, per the CARES Act.)
Q. When do I need to make my gift?+
A. We must receive your gift by Dec. 31 for your donation to qualify this year. If you have check-writing privileges on your IRA account, please mail your check by Dec. 18 in order to give us time to process your gift before the end of the year.
Q. Do I need to give my entire IRA to be eligible for the tax benefits?+
A. No. You can give any amount under this provision, as long as it is $100,000 or less per year. If your IRA is valued at more than $100,000, you can transfer a portion of it to fund a charitable gift.
Q. I have two charities I want to support. Can I give $100,000 from my IRA to each?+
A. No. Under the law, you can give a maximum of $100,000. For example, you can give each organization $50,000 this year or any other combination that totals $100,000 or less. Any amount of more than $100,000 in one year must be reported as taxable income.
Q. My spouse and I would like to give more than $100,000. How can we do that?+
A. If you have a spouse (as defined by the IRS) who is 70½ or older and has an IRA, he or she can also give up to $100,000 from his or her IRA.
Q. How long after I turn 70½ do I have to make the gift?+
A. The first calendar year you turn 70½, you have until April 1 the following year to make your first required distribution. In subsequent years, the deadline is December 31.
*The IRA Charitable Rollover was signed into law in 2015, allowing taxpayers age 70½ or older to transfer up to $100,000 annually from their IRA accounts directly to charity without first having to recognize the distribution as income.
**Please consult your personal tax advisor to confirm your individual circumstance.