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Unlocking Potential: How Your IRA Can Drive Impact with the IEEE Foundation
Almost 50 years ago, the United States Congress passed the Employee Retirement Income Security Act (ERISA). This federal law “set minimum standards for most voluntarily established retirement and health plans.” Among many other things, it enabled the implementation of the Individual Retirement Arrangement (IRA). A few decades later, in 2006, the Pension Protection Act created the Qualified Charitable Distribution (QCD – also known as an IRA Charitable Rollover), which allows owners aged 70½ or older of traditional and Roth IRAs the ability to distribute directly to certain public charities, such as the IEEE Foundation. A few years later, the Protecting Americans from Tax Hikes Act of 2015 (PATH) extended and made permanent QCDs.
What does this mean for you? IRA holders age 70 ½ and older can make QCDs up to $105,000 per year (and up to $210,000 per year for married couples) from their IRA to the IEEE Foundation without having to count the transfers as income for United States federal tax purposes. For IRA holders age 73 and older, QCDs are eligible to be counted toward an individual’s minimum required distribution!
As an IEEE supporter, you can use this strategy to maximize your philanthropic impact while reducing your taxable income. IEEE and the IEEE Foundation (both IRS-recognized 501(c)3 organizations) and any of its donor-supported programs can accept QCDs from most IRA providers. You can find more information needed to process your gift at our https://www.ieeefoundation.org/ways-to-give/ira-charitable-rollover/.
As a member of the Life Members Committee, Julian Bussgang realized how much IEEE relies on donations to fulfill its mission. Having reached his 70 ½ birthday, Julian had the opportunity to support the Foundation by giving through the IRA Charitable Rollover provision. He found it was “a wonderful and ‘painless’ way to make donations!”
Peter M. Silverberg, an IEEE Life Senior Member, calculates what the amount of IEEE Member Dues would be and sends that to the Foundation. Peter gives through his Individual Retirement Account (IRA). This allows him to make QCDs without having to count the transfers as income for federal tax purposes, plus being that he is older than 73 it is eligible to be counted toward his minimum required distribution. According to Peter, “when I retired I lost all my workplace friends, but IEEE does not retire.” Peter continued, “now I have a social-technical group of buddies.”
How to initiate a transfer
Start by contacting your financial or legal advisor. Their answer will define your next steps. They may need information about the IEEE Foundation to initiate the transfer (see below for Legal Name and Tax ID number). If you are ready to make your gift today, you can use the following Sample Letter To IRA Administrator PDF/Word to request a direct charitable distribution from your IRA. Ask your IRA administrator about making a direct transfer to the IEEE Foundation, Inc. or have the administrator send a check from your account to us. To be tax-free, the donation must go directly from your account to the IEEE Foundation, Inc. without passing through your hands.
Legal Name: IEEE Foundation, Inc.
Address: 445 Hoes Lane, Piscataway, NJ 08854, USA
Federal Tax ID Number: 22-7310664
Learn more about giving through an IRA
What gifts qualify as IRA Charitable Rollover?
A gift that qualifies, technically termed a “qualified charitable distribution,” is:
- Made by a donor age 70 ½ or older.
- Transferred from a traditional or Roth IRA directly to a permissible public charity, such as IEEE or the IEEE Foundation. (If giving in this manner, please tell your broker or fund manager to name you as the donor on the transfer, and if your gift is intended for a program or Fund have the broker specify that as well.)
- Completed during the applicable tax year.
Is there a limit on the amount that can be given?
Yes, there is a limit. An individual taxpayer’s total IRA Charitable Rollover gifts cannot exceed $105,000 per tax year. Married couples can donate up to $210,000 per year.
Is an income tax charitable deduction available on my IRA Charitable Rollover gift?
No. The gift would be excluded from income, so providing a deduction in addition to that exclusion would create an inappropriate double tax benefit.
Can I still make a gift with an IRA beneficiary designation?
Absolutely. Whether or not you choose to make an IRA Charitable Rollover gift, you can still designate IEEE or the IEEE Foundation as a beneficiary to receive IRA assets after your lifetime. Beneficiary designation qualifies you for membership in the IEEE Goldsmith Legacy League, our elite legacy giving donor recognition group. Be sure to share the good news with us at donate@ieee.org.
Why are Roth IRAs included? Aren’t withdrawals from a Roth IRA tax-free?
Withdrawals from a Roth IRA may be tax-free only if the account has been open for longer than five years or if certain other conditions apply. Otherwise, withdrawals are taxed as if they came from a traditional IRA. Therefore, certain Roth IRAs could benefit from an IRA Charitable Rollover.
Making a QCD is a powerful way to reduce your taxable income while making an impact on IEEE’s philanthropic programs. If you have any questions, visit the IEEE Foundation IRA Charitable Rollover webpage or contact your IRA Provider.
The information in this article is for educational purposes only and is not intended as legal, tax, or investment advice. If you are considering a donation from your IRA, consult your tax and legal advisors to determine the best options for you.
