IRA Charitable Rollover

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Making a gift to Clarkson

IRA charitable rollovers must be requested by the donor directly to his/her IRA administrator. The process is not standardized across the industry, and each company will set its own policies and procedures, so you may wish to contact your administrator early in the process.  The proper name to use in a transfer request is “Clarkson University,” and the federal ID number is 15-0543659. You may wish to provide this mailing address

Annie Clarkson Society
Clarkson University
Box 5522, Woodstock Lodge
Potsdam, NY 13699

For information on how to make an IRA Charitable Rollover gift to Clarkson University, please visit these instructions.

New Provisions of Secure Act 2.0 effective January 1, 2023

RMD Age Delay SECURE Act 2.0 increases the required minimum distribution age to 73 beginning January 1, 2023. However, if you turned 72 during 2022, you must take your first RMD by April 1, 2023.

· If you turned 72 in 2022 or earlier, you will need to continue taking RMDs as scheduled.

· If you’re turning 72 in 2023 and have already scheduled your withdrawal, you may want to consider updating your withdrawal plan.

Changes to the Qualified Charitable Distribution (QCD) Rules

A QCD is a direct transfer of funds from your IRA, payable directly to charity. Amounts distributed as a QCD can be counted toward satisfying your RMD for the year, up to $100,000. The QCD is excluded from your taxable income, unlike with a regular withdrawal from an IRA, even if you use the money to make a charitable contribution later on. If you take a withdrawal, the funds would be counted as taxable income even if you later offset that income with charitable contributions. This could affect your tax brackets and phase out other benefits.

Secure Act 2.0 Allows the Use of QCDs to Establish Gifts with Income  

Beginning in 2023, donors over age 70½ or older, may elect as part of a QCD a one-time gift up to $50,000 (per individual), to establish a charitable remainder unitrust, a charitable remainder annuity trust, or a charitable gift annuity. This amount counts toward the annual RMD. Note that for gifts to count, they must come directly from your IRA by the end of the calendar year. Please contact the Annie Clarkson Society staff for more information at AnnieSociety@clarkson.edu.

Cautions

  • The transfer must be made from your IRA directly to charity, otherwise you must declare the distribution as income
  • The IRA must be a traditional IRA or a Roth IRA; it cannot be an employer sponsored plan such as a SIMPLE IRA, a 401(k) or 403(b) plan or a simplified employment pension (SEP) plan
  • Distributions from Roth IRAs are not taxed to the account owner, so it is still wise to determine if some asset other than the Roth IRA is best to give to charity
  • Transfers are not deductible as charitable gifts
  • You may receive no benefit from the charity for your transfer (e.g. tickets, dinners, etc.)
  • Transfers cannot be made to gift annuities, charitable trusts or pooled life income funds
  • Transfers cannot be made to donor advised funds, private foundations or “supporting organizations”
  • The donor is responsible for and must obtain documentation for the transfer as he/she would substantiate any gift to charity
  • Transfers are made from otherwise taxable income first. Non-taxable income in your IRA may not be considered a qualified transfer and should be handled differently
  • In some states (check with your advisor), IRA rollovers may be includable in income for state and local tax purposes and may not earn an offsetting charitable deduction, depending on state and local law
  • In some states (check with your advisor), IRA withdrawals up to a certain amount may not be includable for state income tax purposes, thus negating some benefit of an IRA charitable rollover at the state level.

Who might use this opportunity?

If the majority of your assets are in IRAs, it may be easier to make a direct transfer rather than reporting a withdrawal on your tax return

  • If you do not itemize, you may be able to make IRA gifts without increasing (and maybe even decrease) your adjusted gross income
  • If you already give up to 50% of your adjusted gross income, this legislation may allow you to, in effect, exceed that limit
  • If you have accrued a “carryover” of charitable deductions from past tax years, this legislation may allow you to make gifts without impacting those carryover amounts
  • If your level of income phases-out certain deductions, a rollover may allow you to make gifts without increasing (and maybe even decrease) your adjusted gross income
  • It may simply be easier to make a transfer from your IRA to charity and not need to worry about the income tax implications
  • If you’ve been thinking about making a larger gift, this may provide a tax-advantaged time-frame for doing it
  • In some states (check with your advisor) a charitable deduction is not allowed for state tax purposes.  A rollover that does not increase your reportable income may result in savings on state taxes as well

IRA Rollover gifts are eligible to count in Clarkson fundraising campaigns, in your next anniversary reunion and towards annual Roundtable recognition.

Everyone’s financial position is unique, so it is important to consult your tax counsel and plan administrator before making gifts from your IRA.

Most IRA rollover gifts come to Clarkson as a check from an IRA administrator.  Oftentimes these checks do not identify the donor or the fact that it is a rollover gift.  It is helpful if you contact Clarkson at the time you authorize your rollover gift.

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This web page does not provide legal or financial advice, nor is it a comprehensive review of the topic. You should consult your legal and financial advisors and Clarkson University before making or planning
your gift.