Gifts from IRA/Retirement Plans
Retirement plans offer a great way for you to make a gift to Reed—you can name the college as the beneficiary of all or a portion of your IRA or other retirement accounts.
Some donors may be able to also take advantage of the IRA Charitable Rollover provision and make direct gifts to Reed.
IRA Charitable Rollover Gifts
Required Minimum Distributions (RMDs) Waived in 2020!
Under the recently enacted CARES Act (Coronavirus Aid, Relief, and Economic Security Act), for the year 2020, there is no requirement to take distributions from retirement accounts (whatever the age of the owner). The minimum age for making a qualified charitable distribution, or an IRA rollover gift, from an IRA to a charity remains at 70½, and the annual limit remains at $100,000. However, since cash gifts are deductible in 2020 to the extent of adjusted gross income, a person could withdraw and then contribute a larger amount—with the deduction offsetting the taxable withdrawal.
Donors who are at least 70½ years old may transfer a gift from their qualifying IRA account directly to Reed of up to $100,000 ($200,000 total for a couple with separate IRAs) in a given year. These qualifying charitable distributions may count towards a donor’s required minimum distribution and will be excluded from the donor’s taxable income, but the IRS does not allow for these gifts to also qualify for charitable income tax deductions.
To initiate your charitable IRA rollover gift, first contact your IRA administrator to learn if your IRA qualifies. You may use this sample instruction letter to request the distribution, but your administrator may have additional instructions.
Please also notify Reed's gift accounting coordinator at 503/777-7583 or firstname.lastname@example.org of your incoming IRA distribution so that Reed is aware that your gift is intended to be a qualified IRA rollover distribution and the college may receipt your gift accordingly.
Naming Reed as a beneficiary of your retirement plan or account
You can include Reed as part of your legacy by naming the college as the beneficiary of all or a portion of a retirement account or other asset plans. Tax-deferred retirement plans can make excellent charitable gifts. If you designate that all or a part of your retirement plan goes to Reed, the amount of this gift is included in your taxable estate but is fully deductible as a charitable gift. Generally, the full amount of your gift made through a beneficiary designation can be received by Reed and used for charitable purposes with no income tax due. The same asset, if left in your estate and not given to charity, may be subject to both income and estate taxes. Non-retirement assets are the least susceptible to taxation and are often better assets to leave to family members.
The process is simple: just contact your IRA administrator to update your beneficiary designation form. You have the reassurance that you can continue to take withdrawals from your plan during your lifetime, and you can change your designation if your circumstances change.
We hope you’ll let us know about your gift! By informing us of your gift, we can say thank you now and ensure that your gift will be used exactly as you intended. Informing us of your beneficiary designation also helps ensure that the funds will be distributed to Reed as you instruct.
If you have questions about how to make a gift to Reed with your IRA, or how to designate your IRA gift, please contact Kathy Saitas, advancement counsel and senior director of gift planning, at 503/777-7759 or by email at email@example.com.
The information on this site is not intended to provide specific advice about your estate plan or to recommend a specific course of action. We suggest you consult your professional advisers before taking any action, then contact Reed's gift planning office at 503/777-7573 or at firstname.lastname@example.org to learn more about these giving strategies.