Giving from your IRA Required Minimum Distribution (RMD)

Who this applies to:

If you are age 70½ or older, you can transfer up to $105,000 from your traditional Individual Retirement Account (IRA) directly to a charity with a qualified charitable distribution (QCD). If you are 73 or older, the transfer counts towards your Required Minimum Distribution (RMD) and allows you to avoid paying income tax on the distribution, while supporting your favorite charity or any fund at the Community Foundation that is not a donor-advised fund. Please consult a tax advisor regarding your specific situation.

Where to Give

QCD gifts can be made directly to the nonprofits you give to regularly or you can give to an existing fund at the Community Foundation. This year we recommend making a QCD to support the Greatest Needs Fund, Friends of the Foundation Fund, or Rise Together Fund for Racial Equity. We’ll use our over 40 years of philanthropic expertise, trusted relationships with the nonprofit community, and experience advancing solutions to local issues in our grantmaking decisions.

When to Give

Required minimum distributions (RMDs) are mandatory distributions from your Individual Retirement Account (IRA) that need to be completed by year's end. Most IRA plan sponsors will need to be contacted to complete the QCD by early December to ensure timely distribution, but remember: giving can happen any time of year!

How to Give

To make the QCD, you will need to contact your IRA administrator to request that the QCD be made directly to the fund of your choice at the Community Foundation Santa Cruz County. Please note that an IRA distribution made directly to you as the IRA owner does not count as a QCD—the distribution from your IRA needs to be made directly to the charity.

The Community Foundation is ready to answer any questions you might have about making a QCD. Since each person’s situation is unique, we always recommend that you discuss the benefits of a QCD gift with your professional advisor before making the gift.

If you are ready to go, you can notify your IRA administrator using this Distribution Request Letter template:

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[Your Name]

[Your Address]

Date

[Name of IRA administrator]

[IRA Administrator Address]

RE: Request for a Qualified Charitable Distribution or Charitable Rollover from IRA

Dear IRA administrator:

Please accept this letter as my request to make a qualified charitable distribution, also known as a charitable rollover from my Individual Retirement Account #[ ______________________] as provided in The Protecting Americans from Tax Hikes Act of 2015 and Section 408(d)(8) of the Internal Revenue Code of 1986, as amended.

Please issue a check in the amount of $[___________] payable to Community Foundation Santa Cruz County and mail it to:

Community Foundation Santa Cruz County

Payable to [insert name of fund]

7807 Soquel Drive

Aptos, CA 95003

In your transmittal, please include my name and address as the donor of record in connection with the distribution and copy me.

It is my intention that this distribution qualify for exclusion from my taxable income during the [insert tax year].

If you have any questions or need to contact me, I can be reached at [insert contact information].

Thank you,

[Your Name and Email]

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