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:

  1. 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.
  1. 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.
  1. 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.
  1. 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.

Photo by: dailyinvention