Gift from a Retirement Account
Annual withdrawals are required from traditional retirement accounts after
age 72, and the withdrawals are taxed as income. However, if a person
doesn’t need the income, they can avoid income tax on the withdrawal
if they arrange a direct donation from their account to a qualifying charity
like the MHP Foundation.
IRA owners must be 70 ½ or older to make a tax-free charitable contribution.
Once a donor reaches age 70 ½, they can contribute up to $100,000
per year directly from an IRA to a charity without paying any income tax
on the transaction.
Charitable contributions can only be made from IRAs, not 401(k)s or similar
accounts. However, a donor can roll funds over from a 401(k) to an IRA.
Talk to your broker to arrange a roll over.
The transfer must be direct from the IRA to the charity. Call your broker
to arrange the transfer. The broker can contact the MHP Foundation at
317-421-0361 for account numbers, etc. if it’s a direct deposit,
or they can mail a check to the MHP Foundation, 2325 Intelliplex Drive,
Suite 201, Shelbyville, IN 46176. Do not withdrawal the money and then
give it to the Foundation as the withdrawal will be taxed as income.