Use Your IRA to Make a Gift, Tax Free!

By Robert Kuchner, President of Jewish Community Foundation of Greater MetroWest NJ

If you are over 70½ years of age and have an IRA, I have some great news for you! You can now make a tax-free rollover gift from your IRA of up to $100,000  ̶  either to Jewish Federation of Greater MetroWest NJ (Federation) or by funding an endowment through the Jewish Community Foundation (JCF) – without triggering income tax. 

It’s called an IRA Charitable Rollover Gift, and thanks to the “Protecting Americans from Tax Hikes (PATH) Act” of 2015 which President Obama signed into law last year, the amount you transfer may satisfy your entire Required Minimum Distribution (RMD) and is TAX-FREE! (Yes, even though the money comes from an IRA, it is excluded from taxable income.)

The following guidelines/restrictions apply for making an IRA Charitable Rollover gift:

  • The donor must be 70½ years old or older.
  • The IRA transfer must go directly from your IRA to Federation or JCF.
  • Married couples may each donate up to $100,000 from individual IRA accounts.
  • Transfers of IRA assets cannot be made to donor advised funds, supporting organizations, charitable gift annuities, or charitable remainder trusts. The gift is not eligible for an additional charitable income tax deduction.

If you qualify, consider using your IRA Charitable Rollover to fulfill your pledge to Federation’s Annual Campaign; create an Annual Campaign Endowment; increase your legacy by adding to an existing endowment; strengthen the JCF Innovation Fund; or support a scholarship, advisory fund, supporting foundation, or other JCF program.

The process of making an IRA Charitable Rollover starts with your IRA provider. Contact your IRA provider for instructions or call JCF for a sample letter you can personalize to instruct your IRA provider. To authorize a wire transfer from your IRA account to JCF, call (973) 929-3113. And if you have questions or simply want to review the forms, please call (973) 929-3113 or send us an email at jcf@jfedgmw.org.

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