Western Kentucky University

Legacy of Spirit – Office of Gift Planning





On Your Mark, Get Set . . . Wait

If you’re waiting for Congress to act before making a distribution from your IRA to WKU this year, you may have to hold off a little longer. The provision that allows IRA owners ages 70½ and older to make direct gifts to charity expired at the end of 2014. Renewal of the provision is included in the extenders package that is awaiting action in Congress.

Each year since 2006, eligible IRA owners have been able to direct the custodians of their accounts to send checks up to $100,000 to charity. Although no income tax charitable deduction is available, the distribution is not subject to tax, as it would be if the IRA owner made a withdrawal and then gave the funds to charity. Qualified charitable distributions also satisfy required minimum distributions, providing tax savings.

If you normally itemize your income tax deductions, consider having your gift to WKU made from your IRA, at least up to the amount of your required minimum distribution. If the law is extended, the gift will be considered a qualified distribution and you’ll avoid the tax you would otherwise owe on a withdrawal. If the law is not extended, you’ll be subject to tax, but receive an offsetting income tax charitable deduction. Call us if you have questions about making gifts from your IRA or the status of the renewal.