What do animals have to do with your IRA?
Federal legislation that allows you to make a tax-free gift from your IRA to help animals is about to expire. What does that mean for you or perhaps for another compassionate person in your life?
If you are 70 1/2 or older, you are required to take distributions from your standard IRA, even if you don’t need the money for living expenses. And anytime that you withdraw funds from an IRA, income taxes must be paid on those distributions. Many of us would prefer to have our IRAs help animals without having to pay taxes on the money, so we’ve made PETA the beneficiary. But that doesn’t take effect until we die. Now, for the tax year 2011, people who are 70 1/2 or older can make a direct transfer to PETA of up to $100,000 per year before death, without paying any taxes. This is a very good deal for animals!
Charitable rollovers can be used to satisfy the minimum required distributions from your IRAs (but aren’t limited to that) and can lower the balance that will be used to compute future required distributions. To make sure that the transfer is fully tax-free, have the funds sent directly to PETA and not to the IRA owner or another individual first.
Whatever your situation is, it’s a good idea to check with your tax adviser to see how charitable donations could save you from paying Uncle Sam more money (while saving animals!). For more information on how to support PETA’s work to help animals, please contact us at PlannedGiving@peta.org or call Tim Enstice, the PETA Foundation’s director of planned giving, at 757-962-8213. More information on how to make tax-free gifts from your IRA is available here.
Celebrate today, plan for the future, and leave a legacy.