1. Contact your IRA custodian and request the necessary forms to make the gift. If the custodian does not have a specific form, you may send a letter similar to this example:
The
American Jobs and Closing Tax Loopholes Act of 2010 (H.R. 4213) permits a
rollover directly from an IRA to a qualified public charity. As the owner of
IRA account #123-456789 that is in the custody of your organization, I request
that you transfer from that account the sum of $(x,xxx) to The Vital Ground
Foundation (Vital Ground), c/o Mark Brennan, Director of Development, T-2
Fort Missoula, Missoula, MT 59804. The Treasury Tax ID Number for Vital Ground
is: 87-0483446.
It is my intention to make a Qualified Charitable Distribution (QCD) to Vital
Ground from my IRA, which may fulfill part or all of my IRA required minimum
distribution for this year.
This letter is sufficient authorization for you to make this QCD gift. However,
if you require any further documents, please forward those to me for my
signature. Cordially yours,
(your name)
2. Most IRA custodians will issue the gift by check or electronic funds transfer directly to Vital Ground. Do be advised, some custodians will send a check to the donor, payable to Vital Ground. This transaction will still qualify as long as the payment is made directly to Vital Ground and not you, the donor.
If
the check is sent to you, please mail to:
Mark Brennan, Director of Development
The Vital Ground Foundation
T-2 Fort Missoula
Missoula, MT 59804
3. Please notify Mr. Brennan at Vital Ground by phone at (406) 549-8650 or via email at mbrennan@vitalground.org when you've initiated your IRA gift. A special letter will be drafted upon receipt of any rollover gift.
4. Your IRA custodian will provide you with a Form 1099 to report the full qualified distribution amount on your tax returns. Consult your tax preparer if you have questions concerning your specific tax situation. Please note the following restrictions:
- Donors must be age 70½ or older and own a traditional or Roth IRA. Other retirement plans, such as pensions, Simple IRAs, 401(k) plans, 403(b) plans, and others are not eligible.
- Only the IRA trustee can transfer gift amounts to a qualified charitable organization. If IRA owners withdraw funds and then contribute them to charity separately, amounts withdrawn will be included in the donor's gross income and taxed accordingly. Distribution checks must be issued in the name of a qualified charity, not to the account owner, and advance notification must be given to the charity of the forthcoming gift.
- No charitable deductions are allowed, but gift amounts will not be included in the donors' incomes. According to the IRS, these IRA gifts may be used to satisfy charitable pledges.
- Note that up to $100,000 may be distributed for 2011, but gifts for calendar year 2011 must be completed by December 31, 2011.
- The ceilings on contribution deductions (50% of adjusted gross income {AGI} for cash and 30% of AGI for capital gain assets) do not apply to IRA gifts.
- IRA gifts cannot be made to charitable remainder trusts or to fund other life-income gift arrangements, such as charitable gift annuities. Transfers are also not permitted to donor-advised funds or supporting organizations.
