Good news for donors age 70 ½ and older who would like to make a meaningful gift to our community during their life time.

The tax bill  passed by Congress in December, 2010 reinstates and extends the IRA Charitable Rollover until December 31, 2011.

Through 2011, donors age 70 ½ or older are able to transfer tax-free to the Ann Arbor Area Community Foundation up to $100,000 annually from their Individual Retirement Accounts (IRAs).  Married couples are allowed to transfer up to $200,000 annually if each spouse maintains separate IRA's. While the payout can satisfy the required minimal distribution, donors do not have to report the distribution as taxable income.

It’s important to note that:

• Transfers from 401(k) plans or other tax-favored retirement planning vehicles are not eligible.
• Gifts made to donor advised funds, supporting organizations or private foundations are not eligible.

This opens another avenue of giving for donors who are looking to make a meaningful gift to our community during their life time - one that will make all the difference in people’s lives, especially in a time of great need.

While it’s possible to give IRA assets tax-free by designating AAACF as a charitable beneficiary in their estate plans, many donors enjoy making a meaningful gift during their lifetime.

This opportunity may provide an attractive tax planning vehicle for those who are required to take a minimum IRA distribution but do not need the income, and are looking to save on future estate taxes. The transaction incurs no federal or state income tax, and the assets will no longer be part of a donors’ estate for tax purposes – which in turn reduces the potential estate taxes heirs could face that are associated with receiving IRA assets. Donors are able to leave heirs other assets that have a more favorable tax treatment.

Donors may be interested in this charitable opportunity if they:

• Have excess retirement savings,
• Are subject to a 50% of income charitable deduction limit,
• Take the standard deduction on their tax return,
• Accept minimum distributions from an IRA and have alternative sources of income,
• Are planning to leave a charitable legacy through an estate plan,
• Have designated a favorite charity as a beneficiary of retirement assets, or
• Care about our community and would like to make a meaningful gift during their lifetime that will make a real difference.

Donors who would like to make a gift directly from their IRA accounts can take full advantage of the Community Foundation’s personalized service and local expertise. We want to ensure that anyone who is looking to make a meaningful gift to our community knows about this unique opportunity before it expires in 2011.

• To download the Charitable IRA Giving Tool
• To download the Charitable IRA Worksheet
   

For more information or if you are interested in transferring IRA assets directly to the Community Foundation, please contact  AAACF’s CFO Doug Weber via email or call (734) 663-0401.