All posts by Tony Martignetti

Charitable IRA Rollover Revived

Happy New Year!

Courtesy of Philanthropy.com
Courtesy of Philanthropy.com
Passed on January 1, 2013, the American Taxpayer Relief Act of 2012 renewed charitable giving from individual retirement accounts (IRAs) for those 70-and-a-half or older.

If you were practicing Planned Giving a few years ago, this is deja vu. All the requirements are the same as in 2010, and there are two add-ons.

This is an IRA distribution, not a rollover. A rollover is a transfer from one retirement account to another retirement account.

What we have here is a distribution to charity. I use the vernacular in my title because that’s what people search for.

From here on I’m calling this a qualified charitable distribution, the exact designation in the Act.

Please recognize that my analysis is based on my reading of the American Taxpayer Relief Act of 2012, without the benefit of IRS rulings, tax court decisions or other official guidance that has yet to come. I am not providing tax, accounting or legal advice. Donors must consult their own advisors to determine whether, and how, to make a charitable gift.

Here are the requirements for a qualified charitable distribution:

  1. Your donor is at least 70 1/2 years old on the date of gift and yours is a 501(c)(3) charity (supporting organizations are not included; nor are donor advised funds)
  2. The IRA is a traditional or Roth
  3. Maximum $100,000 per donor per year in qualified charitable distributions
  4. The distribution is direct from IRA to charity
  5. The full value of the gift would be eligible for an income tax charitable deduction if it were not a qualified charitable distribution
  6. The amount distributed would be included in gross income if it were not a qualified charitable distribution

Promotion
Numbers 1-4 are straightforward and what I recommend using in promotional materials. Also drop in these two points if you have space:

First, the amount of the gift counts toward an IRA required minimum distribution, or RMD. Lots of people (though not as many as in 2007 and years before) are required to take more from IRAs than they need. This provision helps them reduce that dilemma.

Second, the amount of the distribution to charity is not included in federal gross income, so it’s exempt from federal income tax.

Important Fine Print
Numbers 5 and 6 have nuances that are more appropriate to an article than a blog. They are the primary reasons your materials include a disclaimer that you’re not providing tax or legal advice and donors must consult their own advisors. The first four are secondary reasons for your disclaimer, because there are ins-and-outs in those, too.

I will make an important point on #5. It precludes using this to buy a ticket to your dinner or an auction item; buy anything from your charity; or fund a charitable gift annuity or charitable trust. None of these are 100% deductible for federal income tax purposes. Raffle tickets are precluded because no part of the amount paid is a charitable contribution for federal income tax purposes. (They may be deductible losses if the person has gambling winnings, but we’re not going there.)

New From 2010
The two additions from the 2010 version are (subject to 1-6 above):
— Your donors can can make qualified charitable distributions before February 1 and count them toward 2012
— If donors took IRA distributions in December, they can count any portion of them as 2012 qualified charitable distributions. Their gifts need to get to you before February 1 to grab this opportunity. (You may disregard #4 for this.)

A Download For You
Here’s an easy one-pager I put together for you to share with your board; use in promo materials; excerpt for an email blast; carve up for a newsletter sidebar; and generally use for your charity as you like.

Getting Donors Started

It’s easy. They tell their IRA custodian they want to make a qualified charitable distribution to your charity. Share your tax ID number. Donors will need it to fill out a form.

Take advantage of this immediate-cash planned gift. It’s a valuable way to start the year and gives you a timely, newsy reason to talk to prospects.

Nonprofit Radio, January 4, 2013: The Future Of Planned Giving Marketing, & Free Radio & TV To Boost Online Ticket Sales

Big Nonprofit Ideas for the Other 95%

Listen live or archive:

Tony’s Guests:

Gregory Warner
Gregory Warner
Gregory Warner: The Future Of Planned Giving Marketing

Greg Warner, the founder of MarketSmart, shares his insights on multi-channel awareness building; generating and cultivating leads; and tracking what works.

 

 

 

Amy Spencer & Kevin Russell
With Kevin Russell & Amy Spencer
Amy Spencer & Kevin Russell: Free Radio & TV To Boost Online Ticket Sales

Amy Spencer, Market Manager for Blackbaud, and Kevin Russell, Professioinal Services Manager for Blackbaud, want you to recognize that you do have leverage with the media, and that sending press releases is no longer the way to get radio and TV exposure for your event.

 
 
 


Top Trends. Sound Advice. Lively Conversation.

You’re on the air and on target as I delve into the big issues facing your nonprofit—and your career.

If you have big dreams but an average budget, tune in to Tony Martignetti Nonprofit Radio.

I interview the best in the business on every topic from board relations, fundraising, social media and compliance, to technology, accounting, volunteer management, finance, marketing and beyond. Always with you in mind.

When and where: Talking Alternative Radio, Fridays, 1-2PM Eastern

Sign-up for show alerts!

Here is a link to the recording: 123: The Future Of Planned Giving Marketing & Free Radio And TV To Boost Online Ticket Sales. You can also subscribe on iTunes to get the podcast automatically.

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Challenge The Status Quo

"Change" courtesy of busy.pochi on Flickr
courtesy of busy.pochi on Flickr

“We can’t.”

“Why not?”

Lots of times there isn’t a good reason. Or even an articulable reason.

(Happy New Year! You have my good wishes for 2013! This has nothing to do with that, though I suppose you could adopt “challenge the status quo” as a resolution.)

From questioning the way you track prospect visits to revamping a newsletter concept to adding a theme to an annual dull event, don’t accept that which can be changed–and should be.

Have the courage to question to find out what can be done differently.

There’s just no need to live with that which you can make better. And no one more qualified to call the question than you if you’re in the trenches, on the ground, doing the work, suffering the stupidity.

Question. Challenge. Reject. Revolt.

The people who are crazy enough to think they can change the world, are the only ones who do.

Change doesn’t come in enormous, monumental shifts. It comes from incremental steps.

Take the first step. Ask why.

Nothing is perfect when it first arrives, so don’t let fear of imperfection hold you back. Be willing to make the change, then learn, improve and hone.

A boy scout leader wisely admonished me in my teens: tradition is often a mistake made more than once.

Don’t fear change. Don’t fear the unknown.

Challenge the status quo.

Nonprofit Radio, December 21, 2012: Candidates For Causes & Computers Crash

Big Nonprofit Ideas for the Other 95%

Listen live or archive:

Tony’s Guests:

Roger Egger
Robert Egger
Robert Egger: Candidates For Causes

Robert Egger is president of cForward, working to rally candidates around nonprofit platforms. We’ll discuss how to assess those in your local races; getting the nonprofit agenda before them; and how to support the candidates who step up.

 

 

Scott Koegler
Scott Koegler: Computers Crash

Scott Koegler, the editor of Nonprofit Technology News and our tech contributor, reminds us that technology can let us down. Your computer hardware will only last so long, so you should have a plan for replacing it to avoid a crisis. I’ll talk to this former CIO about the hardware life cycle; budgeting; training; and planning.

 
 


Top Trends. Sound Advice. Lively Conversation.

You’re on the air and on target as I delve into the big issues facing your nonprofit—and your career.

If you have big dreams but an average budget, tune in to Tony Martignetti Nonprofit Radio.

I interview the best in the business on every topic from board relations, fundraising, social media and compliance, to technology, accounting, volunteer management, finance, marketing and beyond. Always with you in mind.

When and where: Talking Alternative Radio, Fridays, 1-2PM Eastern

Sign-up for show alerts!

Here is the link to the audio: 122: Candidates For Causes & Computers Crash. You can also subscribe on iTunes to get the podcast automatically.
View Full Transcript

I Am Grateful

I am grateful to my clients in Planned Giving and Charity Registration. Thank you for trusting me with your work.

I am grateful to the listeners of Tony Martignetti Nonprofit Radio.

I am grateful to you if you read or subscribe to my blog.

I am grateful to The Chronicle of Philanthropy for hosting my Fundraising Fundamentals podcast.

I am grateful if you listen to Fundraising Fundamentals.

I am grateful to you if came to see me speak or perform stand-up comedy; attended a webinar; read an article; watched a video; or listened to a podcast.

I am grateful to my iTunes subscribers; Twitter followers; LinkedIn connections; YouTube viewers; Foursquare friends; Facebook friends; Google+ friends; and Pinterest followers.

I hope you always find my work valuable and helpful to your work. And you sometimes get a chuckle. I’m always interested in your feedback.

I haven’t exploited the link opportunities because that would dilute my message.

I want you to know I am grateful.