IRA Charitable Rollover
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Generous giving and tax benefits – rolled into one.
IRA charitable rollovers are an excellent giving option for seniors. If you are over 70 1/2 years old, you can give a tax-free distribution from your IRA to qualified charities. The limit is $105,000 for individuals and $210,000 for couples. Your gift can satisfy your IRA’s required minimum distribution (RMD) while lowering your adjusted gross income (AGI) for tax purposes.
New in 2023: IRA-Funded Charitable Gift Annuities
Thanks to the passage of the SECURE Act 2.0, if you own a traditional IRA and are age 70 1/2 or older, you can make a one-time transfer from your retirement account to fund a charitable gift annuity, or CGA for short. A CGA is a charitable giving tool that allows you to make a gift to ministry while simultaneously receiving tax benefits and guaranteed lifetime income that won’t fluctuate with changing market conditions.
In 2024, individuals are eligible to transfer up to $53,000 from an IRA to a CGA; spouses can combine $53,000 transfers into a single CGA for a maximum of $106,000. Known as qualified charitable distributions (QCDs), these transfers are excluded from taxable income and satisfy your IRA’s required minimum distribution. Keep in mind that annual payments from an IRA-funded CGA will be taxed as ordinary income since IRA assets aren’t taxed when transferred to a CGA.
Key Benefits
Reduce Your Taxable Income
This investment can lower your annual tax burden by reducing your income for the year.
Give Back With Retirement Savings
IRA charitable rollovers give you greater flexibility in supporting ministry with retirement funds.
Satisfy IRA Requirements
IRAs have complex rules that govern minimum distributions. An IRA charitable rollover can help you satisfy your annual IRA distribution requirements.Start Here
Your IRA can fund more than your retirement – it can also bolster Gospel-minded ministry with needed financial support.
CONNECT WITH US
Use the “Start My Rollover” button to provide the information our giving professionals will use to guide you through the process.
INITIATE YOUR ROLLOVER
Ask your financial advisor or IRA administrator to transfer your gift directly from your IRA to WatersEdge, for the benefit of the ministry you choose. You’ll need our tax ID number (below) to complete the transfer.
DO GOOD
In addition to satisfying your IRA’s required minimum distribution requirements and enjoying potential tax advantages, you can feel good knowing your gift is advancing God’s Kingdom.
IMPORTANT!
Be sure to have the following WatersEdge tax information ready when you speak with your financial advisor or IRA administrator:
The Baptist Foundation of Oklahoma dba WatersEdge Advisors | EIN 73-0623038
Giving Scenarios
Required Minimum Distribution (RMD)
The amount of money you are required to withdraw from your IRA every year after you turn 73.
Qualified Charitable Donation (QCD)
A charitable donation that counts toward your RMD, available to those 70 1/2 years old and older.
An IRA Charitable Rollover May Be Perfect If:
You have significant assets in your IRA.
Your Social Security income is taxable.
You want to make gifts that are large relative to your income.
You do not itemize your taxes.
“Our tax man is a Christian and he suggested an IRA charitable rollover as a way to reduce our taxable income while helping others at the same time. We chose to give to Baptist Village Communities’ Adams Fund, which provides financial assistance to meet the day-to-day needs of dozens of senior adults with limited incomes.”
Gil Kettler
Donor | Oklahoma City, Oklahoma
Go Deeper
Tax Impacts
A charitable IRA rollover allows donors age 70 1/2 or older to transfer up to $105,000 directly from the donor’s IRA to a qualified charity each year. While you do not receive a charitable income tax deduction for the gift transfer, you benefit from not having to recognize the gift transfer as taxable income. In other words, instead of receiving a charitable income tax deduction, you altogether avoid claiming the funds as income in the first place.
Fees and Charitable Options
There is no fee associated with the rollover itself. Any fees depend on what the donor decides to do with their charitable rollover. While you cannot place the rollover into a DAF, you can place it into a single charity fund, endowment, custodial account or just request that WatersEdge send the funds outright to a charity.
Minimums
There are no minimums associated with an IRA charitable rollover.
Investment Options
Investment options depend on what type of gift vehicle you place the rollover into.
What Assets Can Fund This Gift?
Contact your IRA administrator and let them know that you’d like to execute a charitable IRA rollover, and the administrator will send the check directly to WatersEdge.
FAQ
1. How much can I contribute from my IRA to charity?
Individuals can contribute up to $105,000 ($210,000 for couple filing jointly) from an IRA directly to charitable causes. This type of gift is known as a qualified charitable distribution (QCD) and can satisfy your IRA’s required minimum distribution (RMD).
2. What is the tax incentive of IRA contributions?
No tax is incurred on the withdrawal from your IRA, so these gifts do not qualify for an income tax charitable deduction. However, they have the benefit of lowering taxes by reducing your adjusted gross income (AGI). Reducing your AGI may result in lower Medicare premiums and a lower portion of Social Security income that is subject to income tax. Unlike many other charitable gifts, this tax strategy can benefit you even if you do not itemize.
3. How should IRA contributions be made to charity?
Funds from your IRA should be given directly to WatersEdge to benefit the ministry or ministries you choose to support. If you withdraw funds first and then make the donation, the gift will not qualify as a tax-free transfer.
Create Your IRA Charitable Rollover today
Review Your Giving Options
When you give generously, the details make all the difference. It’s important to keep in mind your family situation, tax considerations and charitable goals.
Make the right choice with a simple side-by-side comparison.
