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Live Oaks Society |
Current Gifts from an IRA 
Recently, Congress changed the rules on gifts to charity made from an IRA. If you have an IRA and you are older than 70 1/2 you may now make gifts to charity without having it increase your taxable reported income. In 2007 you may give from an IRA up to the maximum of $100,000. Previously if a gift were made in this manner it resulted in increased taxable income, even if you then gave the money to charity. This often would have resulted in an income tax that would not have been offset by the charitable deduction. Although there is not a charitable deduction under the changed rules, there is no longer a tax on what you give away from an IRA. IRA as a bequest A bequest from an IRA results in 100% of your gift benefiting the San Diego Natural History Museum. However the same IRA left to your family may result in them receiving only 30% of the amount after taxes. Dependent on the size of your estate, the taxes on an IRA given to heirs ranges from 30% to an astounding 70%. Consult with your tax advisor about the best way to work with an IRA and your estate in supporting both charity and your family. For many charitably inclined families, advisors are encouraging the use of an IRA to support charity while leaving the assets that have more favorable tax status to be given to family members. |
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