A Tax-Saving Way to Help Montana State University
See Your Generosity in Action
If you are 70½ years old or older, you can take advantage of a simple way to benefit Montana State University and receive tax benefits in return. You can give up to $100,000 from your IRA directly to a qualified charity such as ours without having to pay income taxes on the money.
This law no longer has an expiration date so you are free to make annual gifts to our organization this year and well into the future.
- Your gift will be put to use today, allowing you to see the difference your donation is making.
- You pay no income taxes on the gift. The transfer lowers your taxable income so you benefit whether or not you itemize your deductions.
- Your IRA charitable distribution (what the IRS calls the “qualified charitable distribution”) will satisfy all or part of your annual required minimum distribution (RMD). For IRS rules for qualified charitable distributions, see https://www.irs.gov/publications/p590b#en_US_2017_publink100041439. (See qualified charitable distributions in the left-hand menu under “Are Distributions Taxable?”.)
Frequently Asked Questions
Q. I've already named Montana State University as the beneficiary of my IRA. What are the benefits if I make a gift now instead of after my lifetime?
A. By making a gift this year of up to $100,000 from your IRA, you can see your philanthropic dollars at work. You are jump-starting the legacy you would like to leave and giving yourself the joy of watching your philanthropy take shape. Moreover, you can fulfill any outstanding pledge you may have made by transferring that amount from your IRA as long as it is $100,000 or less for the year.
Q. I'm turning age 70½ in a few months. Can I make this gift now?
A. No. The legislation requires you to reach age 70½ by the date you make the gift.
Q. I have several retirement accounts—some are pensions and some are IRAs. Does it matter which retirement account I use?
A. Yes. Direct rollovers to a qualified charity can be made only from an IRA. A pension, profit sharing, 401(k) or 403(b) plan will not qualify. Most retirement plans allow you to move assets from your plan into a new or existing IRA as a direct rollover. You can then make the transfer from the IRA directly to Montana State University or other qualified charity. To determine if a direct rollover to an IRA is available for your plan, speak with your plan administrator. For IRS rules for rollovers from retirement plans, see https://www.irs.gov/taxtopics/tc413.
Q. Can my gift be used as my required minimum distribution under the law?
A. Yes, absolutely. If you have not yet taken your required minimum distribution, the IRA qualified charitable distribution can satisfy all or part of that requirement. Contact your IRA custodian to complete the gift.
Q. Do I need to give my entire IRA to be eligible for the tax benefits?
A. No. You can give any amount under this provision, as long as it is $100,000 or less this year. If your IRA is valued at more than $100,000, you can transfer a portion of it to fund a charitable gift.
Q. I have two charities I want to support. Can I give $100,000 from my IRA to each?
A. No. Under the law, you can give a maximum of $100,000. For example, you can give each organization $50,000 this year or any other combination that totals $100,000 or less. Any amount of more than $100,000 in one year must be reported as taxable income.
Q. Can I choose how my IRA charitable distribution is used to support MSU?
A. Yes. IRA charitable distributions can be directed to the area of the university you are passionate about. Please note that gifts to the Bobcat Club Annual Scholarship Fund do not qualify for the charitable distribution since the entire contribution is not deductible. All other gifts to the MSU Alumni Foundation qualify for the charitable distribution.
Q. My spouse and I would like to give more than $100,000. How can we do that?
A. If you have a spouse (as defined by the IRS) who is 70½ or older and has an IRA, he or she can also give up to $100,000 from his or her IRA.
It is wise to consult with your tax professionals if you are contemplating a charitable gift under the extended law. Please feel free to contact Kevin Brown at 406-994-4815 or firstname.lastname@example.org with any questions you may have.
The information on this website is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor. Figures cited in any examples are for illustrative purposes only. References to tax rates include federal taxes only and are subject to change. State law may further impact your individual results. Annuities are subject to regulation by the State of California. Payments under such agreements, however, are not protected or otherwise guaranteed by any government agency or the California Life and Health Insurance Guarantee Association. A charitable gift annuity is not regulated by the Oklahoma Insurance Department and is not protected by a guaranty association affiliated with the Oklahoma Insurance Department. Charitable gift annuities are not regulated by and are not under the jurisdiction of the South Dakota Division of Insurance.