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Charitable IRA

For years, estate planners have recommended that retirement assets may be the most tax-effective asset in larger estates to distribute to charity. These assets are not only vulnerable to heavy taxation as part of an estate but also can be taxed again as income in respect to a decedent on the tax returns of heirs.

Until now, there was a disincentive for retirees to give IRAs to charity during their lifetimes because withdrawals from IRAs were subject to income tax—even those given to charity.

New tax law
In 2006 and 2007, retirement assets may become a preferred charitable gift for seniors. IRA distributions to charity can now receive new tax advantages. Americans age 70½ and up can make tax-free IRA contributions to public charities such as your Community Foundation. This new law is in effect for 2006 and 2007 only, unless Congress acts to extend it.

Have questions?  Please review our list of Frequently Asked Questions or contact us at qacf@adams.net or at (217) 222-1237.

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