In August of 2006, Congress passed a law that allows people who are at least 70-1/2 to make gifts directly from their Individual Retirement Accounts to a charity, and avoid paying income taxes on the amounts that are paid. Formerly, any funds withdrawn from an IRA were subject to income taxes, even if they were given to a charity. Here are some summary points about the new law:
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The provision allowing tax-free charitable gifts is time limited. It will apply to gifts made before December 31, 2007. It also applies retroactively to gifts made earlier in 2006. |
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You must be at least 70-1/2 to take advantage of this provision. |
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The law applies to gifts from IRAs totaling up to $100,000 in any tax year. Gift amounts over $100,000 from an IRA are still subject to income tax. |
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Gifts from IRAs do not count in the 50% limitation rule that says that taxpayers cannot deduct more that 50%of their adjusted gross income in any year as charitable contributions. |
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If you have an IRA and would like to make a gift to Texas A&M International University directly from your IRA without ever having to pay taxes on it, simply ask your IRA administrator to write TAMIU a check and send it to TAMIU. You will receive a written gift acknowledgement, which will allow you to avoid income taxes on your gift. |
Sample IRA Contribution Form (.pdf)
If you have questions about this new law, please contact Candy Hein, Vice President for Institutional Advancement, 956.326.2175, or
e-mail tamiugiving@tamiu.edu