News
Time is Running Out
November 21, 2007
Opportunity Is Knocking: Your IRA Is the Key
If you're looking for the most tax-effective gift to make to a charitable organization, your Individual Retirement Account (IRA) may very well be the best choice.
The Pension Protection Act of 2006 presents a new giving opportunity. The law allows individuals aged 70½ or older to make gifts now to qualified charitable organizations like the Kappa Alpha Order Educational Foundation using funds transferred directly from their IRAs. Furthermore, these individuals will not have to pay taxes on the amounts transferred. You can transfer any amount you desire up to $100,000 on or before Dec. 31, 2007.
The Benefits
How the New Law Works
EXAMPLE: James, aged 73, has $150,000 in an IRA. He made a pledge to give the KAOEF $15,000 this year. He had the choice of giving cash or other assets to fulfill the pledge, but now he has another option. If he transfers $15,000 to us from his IRA on or before Dec. 31, 2007, he avoids paying income tax on $15,000. He will not, however, be able to use it as a charitable deduction—it is a pure wash. The Pension Protection Act gives him an easy and convenient way to benefit the KAOEF without tax complications.
Another tax-smart strategy is to name the Kappa Alpha Order Educational Foundation as beneficiary of all or a portion of your IRA assets. By naming the KAOEF as beneficiary of your IRA, you can leave us a gift that is free of all income and estate taxes because we are a charitable organization.
If you would like assistance in completing a gift from your IRA, please contact Erik T. Showalter either by phone, (540) 463-1865 or by e-mail, eshowlater@ka-order.org.
November 21, 2007
Opportunity Is Knocking: Your IRA Is the Key
If you're looking for the most tax-effective gift to make to a charitable organization, your Individual Retirement Account (IRA) may very well be the best choice.
The Pension Protection Act of 2006 presents a new giving opportunity. The law allows individuals aged 70½ or older to make gifts now to qualified charitable organizations like the Kappa Alpha Order Educational Foundation using funds transferred directly from their IRAs. Furthermore, these individuals will not have to pay taxes on the amounts transferred. You can transfer any amount you desire up to $100,000 on or before Dec. 31, 2007.
The Benefits
- The transfer counts toward your minimum required distribution as long as you have not yet received your 2007 distribution.
- The transfer generates neither taxable income nor a tax deduction, so you will receive the benefit even if you do not itemize your tax deductions.
- You can witness the difference your philanthropic dollars make to us.
How the New Law Works
EXAMPLE: James, aged 73, has $150,000 in an IRA. He made a pledge to give the KAOEF $15,000 this year. He had the choice of giving cash or other assets to fulfill the pledge, but now he has another option. If he transfers $15,000 to us from his IRA on or before Dec. 31, 2007, he avoids paying income tax on $15,000. He will not, however, be able to use it as a charitable deduction—it is a pure wash. The Pension Protection Act gives him an easy and convenient way to benefit the KAOEF without tax complications.
Another tax-smart strategy is to name the Kappa Alpha Order Educational Foundation as beneficiary of all or a portion of your IRA assets. By naming the KAOEF as beneficiary of your IRA, you can leave us a gift that is free of all income and estate taxes because we are a charitable organization.
If you would like assistance in completing a gift from your IRA, please contact Erik T. Showalter either by phone, (540) 463-1865 or by e-mail, eshowlater@ka-order.org.
