YOU CAN ONCE AGAIN GIVE IRA ASSETS TO DAVIDSON

On December 17, 2010 President Obama signed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. The Act reinstates for 2010 and 2011 the "Charitable IRA Rollover" which has been available off and on since 2006.

WHAT HASN’T CHANGED: Whatever your age, you can still designate Davidson as the beneficiary of all or part of your IRA at your death, creating an estate tax deduction and avoiding the income tax which would be payable by a non-charitable beneficiary of the IRA. This designation can be done by a simple communication with your IRA custodian, probably doesn’t involve changing your will, and is a good option for anyone considering a bequest to Davidson.

WHAT’S BACK: You can again give up to $100,000 per year from a traditional or Roth IRA account without having the donated amount count as taxable income, IF:

•  You are over the age of 70½ at the time of your contribution, and
• Your IRA custodian transfers the funds directly to Davidson, not to you, and
• Your gift is completed before December 31, 2011.

The law does not allow:

• An income tax deduction for these gifts;
• Using these IRA withdrawals to fund any arrangement which returns a benefit to you, such as a charitable remainder trust, or a gift annuity;
• Directing these gifts to “supporting organizations” or donor-advised funds;
• Gifts from other sorts of retirement accounts, such as Simple IRA, 401(k), 403(b) or Keogh plans.

WHAT'S NEW (IF YOU ACT QUICKLY!):  Recognizing that the last-minute enactment of the law meant that few donors had time to get this done in the waning days of 2010, the Act allows gifts in January 2011 to be reported by donors as if made on December 31, 2010. This means that if you act before the end of this month, you can still make up to $200,000 in gifts to Davidson and your other favorite charities without recognizing IRA taxable income.

Please feel free to call with any questions, and by all means speak to your own advisers and your IRA custodian as well - the sooner the better, if you intend to give by January 31. As in the past, please let James Gibert '79, Director of Planned Giving (jagibert@davidson.edu, 704-894-2469), know directly if you are making an IRA gift, and ask your custodian to include your name on the check or accompanying documentation so that we will know the gift is from you.

We will be happy to direct your IRA gift to the Annual Fund, The Davidson Trust, or another priority of the college.

Visit our Frequently Asked Questions About IRA Gifts page for additional information.