www.nbfoundation.org/newsarticle.cfm?articleID=124584&P -
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Published on: 4/3/2007
Last Visited: 4/3/2007
"This is a wonderful win-win , for people who would rather give to charity than pay taxes, and for the nonprofit organizations they choose to support," said Jim Williamson, President of the Community Foundation of Greater New Britain, which serves Berlin, New Britain, Plainville and Southington.
Thanks to decades of deliberate saving and favorable investment returns, many of today's retirees have more money in their IRAs than they'll ever need.Many have expressed an interest in giving the funds to charity, but income tax must be paid on all withdrawals, which sharply reduces the value of the gift.Others have asked about designating their children as beneficiaries, but that may draw additional tax consequences.
"For larger estates, a good portion of IRA wealth goes to estate taxes and income taxes of beneficiaries," Williamson said.
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The timing of the law's passage could not have been better, said Williamson, as the final quarter of the year is when most charitable giving takes place.
In 2006 and 2007, holders of traditional and Roth IRAs who are at least 70 ½ years old can make direct charitable transfers up to $100,000 per year.As a qualified public charity, the Community Foundation of Greater New Britain can help donors execute the transfers and choose from numerous charitable fund options for their gift.Donor Advised Funds do not qualify for tax-free IRA transfers.
"This really is a limited-time offer.The window is open now, but it will close at the end of 2007 unless Congress extends it," said Williamson.