A Giving Opportunity
If you are 70½ or older and care about the work of Ploughshares Fund, we have good news for you. The fiscal-cliff bill, known as the American Taxpayer Relief Act of 2012 (ATRA), allows you to donate income of up to $100,000 from your IRA distributions to charitable organizations like Ploughshares Fund in 2013, and retroactively for 2012, for a savings on your 2012 taxes due this April.
Donating in 2013 for the 2012 tax year sounds a little confusing at first but here are four types of IRA donors affected positively by ATRA:
- Those who in 2012 made Qualified Charitable Distributions directly from their IRA to charities with the hope that the law would make their distribution tax-free retroactively. If you did so, you guessed correctly. Your 2012 qualified charitable distribution from your IRA is tax-free retroactive to January 1, 2012.
- Those who did not make a qualified tax-free IRA distribution to a charity in 2012 can do so during January of 2013. As long as you complete the distribution before February 1, 2013, your IRA transfer to Ploughshares Fund will be considered a tax-free event in 2012.
- Those who received their IRA required minimum distribution between December 1, 2012 and December 31, 2012 may make the December distribution partially or completely tax-free by making a cash gift to Ploughshares Fund during January of 2013. Or, one can use a December 2012 cash gift, made after receiving a required minimum IRA distribution, to lower or eliminate the tax on the December Required Minimum Distribution. The cash gift must be made before February 1, 2013.
- In 2013, ATRA allows tax-free distributions up to $100,000 from IRAs to charity until December 31, 2013.
If you think you fall into any of these four categories and wish to make a gift to Ploughshares Fund, or to any other charitable organization, we highly recommend you speak with your tax adviser soon because time is already running out on this opportunity.