You only have until December 31 to make your year-end tax-deductible gift to The American Committee for Shaare Zedek!
If you’re 70 ½ and older you can transfer up to $100,000 directly from your IRA to The American Committee for Shaare Zedek, thanks to the “Protecting Americans from Tax Hikes Act” of 2015,” just signed by the President.
If you qualify and take advantage of this charitable gifting opportunity, the amount gifted to charity will not be included in your gross income. Consequently, you will not be entitled to a charitable income tax deduction. However, because the amount distributed from the IRA is not included in your income, for tax purposes, it is treated as if the amount were included in your income and then you received an offsetting, dollar for dollar, charitable contribution income tax deduction. For high and midlevel income taxpayers, this treatment may be far superior than taking a taxable distribution from your IRA and giving the distributed amount to charity because of the limitations on itemized deductions applicable to such taxpayers.
Alternatively, for taxpayers who utilize the standard deduction, the direct contribution may also be superior than receiving a taxable IRA distribution and giving the distributed amount to charity because, with the standard deduction, you do not get a deduction for your gifts to charity.
The favorable tax treatment given to IRA direct charitable gifts applies only to outright charitable gifts and not to amounts used to fund a charitable lead or remainder trust.
If you are at least 70½ in 2015, please consider making a tax-free gift from your IRA in the coming days. Please check with your individual tax advisor to determine whether this is appropriate for you.
For more information, email our Chief Financial Officer Samuel Tuchman at firstname.lastname@example.org or speak to your individual tax advisor.