January 10, 2013
Dear Thomas Jefferson Institute Supporter:
Thank you for requesting information about tax-free rollovers of IRA assets to charitable organizations. I am happy to describe this provision of the American Taxpayer Relief Act of 2012 and enclose a sample letter for your IRA custodian.
As you may know, this Act allows traditional and Roth IRA owners, age 70 Vi and older, to make tax-free transfers up to $100,000 directly from their IRAs to qualified charitable organizations, such as the Thomas Jefferson Institute for Public Policy. While you would not receive an income tax deduction for this gift, the distribution would be excluded from your 2012 and 2013 taxable income, creating a “wash” for tax purposes. A transfer to the Thomas Jefferson Institute would also fulfill some or all of any 2012 (only for distributions made between November 30, 2012 and December 31,
2012) or 2013 required minimum distribution without increasing your taxable income.
This legislation expires on December 31, 2013 without further extension by Congress.
Please see the enclosed sample letter that you may wish to share with your financial planner and IRA custodian. As with any gift plans, we recommend that you consult your personal legal and financial advisors prior to completing this gift.
Please do not hesitate to call me at (703) 440-9447 if you have any questions or require more information. Thank you, again, for your ongoing commitment to the Jefferson Institute. We are grateful that our important work to bring workable alternatives to Virginia government based on free market principles continues to merit your partnership and support.
Sincerely,
Michael W. Thompson Chairman and President
IRS Circular 230 Notice:
We have advised you to seek your own legal and tax advice in connection with gift and planning matters.
The Thomas Jefferson Institute does not provide legal or tax advice. This communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of avoiding tax-related penalties.
SAMPLE LETTER TO DIRECT AN IRA ROLLOVER TO THE THOMAS JEFFERSON INSTITUTE FOR PUBLIC POLICY
Date
Name of IRA Custodian Address
City, State, Zip Code
Re: The American Taxpayer Relief Act of 2012 (H. R. 8).
Dear Custodian, Trustee, or Plan Administrator:
The American Taxpayer Relief Act of 2012, effective from January 1, 2012 to December 31, 2013, permits a rollover directly from an individual retirement account (IRA) to a qualified
public charity. As the owner of IRA [name of IRA account] [account #_] that is in
the custody of your company, I request that you transfer from that account the sum of
$_to the Thomas Jefferson Institute for Public Policy, tax identification number
51-0280185, 9035 Golden Sunset Lane, Springfield, VA 22153. It is my intention to make a Qualified Charitable Distribution (QCD) to the Thomas Jefferson Institute for Public Policy from my IRA as permitted by law. This QCD will fulfill part or all of my IRA required minimum distribution for this year.
I further affirm as follows:
• lam age 70 Vi or older. My birth date is_.
• This IRA rollover is an outright gift to the Thomas Jefferson Institute for Public Policy -I will not receive any benefits for this gift. This rollover will not be used to establish any type of deferred/life income plan (e.g., charitable gift annuity, charitable remainder trust, charitable lead trust, pooled income fund, or other nonqualified use). It is not directed to a donor advised fund, supporting organization, family foundation or other entity or purpose that is not qualified to receive a charitable IRA rollover under the American Taxpayer Relief Act of 2012.
• I understand that a charitable IRA rollover is available only for 2012 and 2013. The maximum gift amount is $100,000 per person per year from my IRA or from all of my combined IRAs (traditional and Roth).
• I will not incur federal income tax liability as a result of this rollover. Therefore, I do not elect withholding for this rollover.
• I will not accept any personal distributions of funds intended for this charitable IRA rollover.
• I understand that this charitable IRA rollover can be applied to my required minimum distribution in the year of the gift.
Thank you for your attention to this matter. Please do not hesitate to call me with any questions.
Sincerely,
[name of donor]