The University of Toledo

IRA Charitable Rollover: Just the Facts

Provisions for an IRA Charitable Rollover were included in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, signed into law on Dec. 17, 2010. Following are facts about the program, which is in effect through 2011.

IRA Charitable Rollover: Allows you, as the IRA owner, to direct a Qualified Charitable Distribution (QCD) up to $100,000 tax-free from your traditional or Roth IRA to a public charity, such as The University of Toledo Foundation. 

Age: IRA owner must be age 70 ½ or older when the QCD is made.

No Income/No Charitable Deduction: QCD from an IRA is not included in gross income, and there is no corresponding charitable income tax deduction. It’s beneficial if you do not itemize or if you reside in a state, such as Ohio, that does not offer a state charitable tax deduction. 

Direct Transfer: Transfer must be made directly from the IRA custodian or trustee to the UT Foundation to be a QCD. 

Required Minimum Distribution: QCD counts toward your required minimum distribution from an IRA. If you received your required minimum distribution from the IRA custodian or trustee, you cannot re-characterize the received amounts. But you still can make a tax-free QCD direct transfer up to $100,000!

Use of the QCD: You can target the QCD for a specific program or fund, or to fulfill a pledge. A distribution is not a QCD if designated to a supporting organization or a donor-advised fund, or if the IRA owner receives a benefit in return, such as tickets, goods or services, or establishes a gift annuity or remainder trust.

Tax Year 2011: Transfer up to $100,000 before Dec. 31, 2011 for favorable tax treatment in 2011.

Planning Point: Although only a traditional or a Roth IRA can make a QCD, other types of retirement plans may be rolled over tax-free into a traditional IRA. Then the IRA custodian or trustee can make the QCD directly to the UT Foundation. Consult your retirement plan trustee or personal tax advisor before doing so.

Tell Us Too: Please notify us once you authorize your IRA custodian or trustee to make a QCD to the UT Foundation. This ensures it is properly credited to the program or fund you intended, and that you receive the appropriate substantiation as well as our thank-you for your support!

Learn More: To learn about more giving options, contact the UT Office of Development at 419-530-5412 or toll free at 1-866-848-0002 or visit www.utoledo.edu/offices/advancement.