Giving to Vestavia Hills United Methodist Church from an IRA
The Consolidated Appropriations Act of 2016 finally made permanent qualified charitable distributions (QCDs) from individual retirement accounts.
After years of contributing to IRAs, income tax is due on that money when you take withdrawals in retirement. Annual withdrawals from traditional retirement accounts are required after age 701⁄2. You can avoid income tax on your required withdrawal by donating your money directly to Vestavia Hills United Methodist Church as a QCD.
Giving to a QCD can automatically satisfy your required minimum distributions (RMDs) for the year. That’s a real advantage for a charitably minded IRA owner who doesn’t need to live on their RMDs.
Those who meet the age requirement (and you have to be 70 1⁄2 WHEN you make the transfer), can transfer up to $100,000 per year directly to a QCD without paying income tax on the transaction. If you file a joint tax return, your spouse can also make a charitable contribution of up to $100,000, meaning couples can exclude up to $200,000 of their retirement savings from income tax if they donate it to charity. Qualified charitable contributions must be made by December 31 each year in order to exclude that amount from taxable income.
Any funds given as a QCD have already reduced your taxable income and cannot also be claimed as a tax deduction. These funds will be listed on your statement but should not be itemized as a deduction on your federal tax return.
State tax laws may differ depending on the type of IRA used for the QCD. Please consult your financial advisor or tax accountant for treatment of a QCD on your state tax return.
To give from an IRA:
- You must be age 70 1⁄2 or older when the transfer is made to VHUMC.
- The maximum amount you can give to charity from your IRA in one year is $100,000 ($200,000 for couples).
- Most types of IRAs are eligible, but employer-sponsored plans do not allow for QCDs. Please consult your IRA custodian or financial advisor to confirm that your IRA is eligible.
- Checks must be made payable directly to VHUMC by your IRA custodian. We suggest you also have the custodian mail the check directly to VHUMC. DO NOT have the check issued in your name.
- Please let us know of your contribution since your custodian may send it without including your name. We will apply it to your current year pledge or place the funds in the General Fund of the church unless you specify otherwise.
- Give the following to your IRA custodian for processing and/or questions:
- Vestavia Hills United Methodist Church, 2061 Kentucky Avenue, Vestavia Hills, AL 35216
- VHUMC’s EIN number is 63-0378123
Questions can be directed to Natalie Giesen (205-769-0121 / firstname.lastname@example.org) or Gary Wyatt (205-769-0108 / email@example.com). Thank you for your contribution to Vestavia Hills United Methodist Church!