Donating to Story County Medical Center

Use Your IRA as Never Before

On Aug. 17, 2006, President Bush signed into law new tax incentives for charitable gifts from donors who are 70½ or older. The Pension Protection Act of 2006 encourages financial support of charitable organizations across the United States.

Under the law, you can make a lifetime gift using funds from your individual retirement account (IRA) without undesirable tax effects. Previously you would have had to report any amount taken from your IRA as taxable income, then take a charitable deduction for the gift, but only up to 50 percent of your adjusted gross income. In effect, this caused some donors to pay more in income taxes than if they didn’t make a gift at all.

Fortunately, now these IRA gifts can be accomplished simply and without tax complications. Plus, you can make the gift now—while you are living and able to witness the benefits of your generosity.

You may contribute funds this way if:
1. You are age 70½ or older
2. The gift is $100,000 or less each year
3. You make the gift on or before Dec. 31, 2007
4. You transfer funds directly from an IRA or Rollover IRA
5. You transfer the gift outright to one or more public charities, but not supporting organizations or donor advised funds
6. You cannot receive benefits from us in exchange for the gift

How The New Law Works
Alice, aged 78, has $400,000 in an IRA and has pledged to give $80,000 this year. If Alice transfers $80,000 from the IRA, she will avoid paying income tax on that amount. She cannot, however, claim a charitable deduction—it is a pure "wash." Alice has found an easy way to benefit charity without tax complications.

If she desired, Alice could give more than $100,000. The legislation allows a maximum $100,000 gift in both the 2006 and 2007 tax years. So Alice could give $100,000 each year. If her spouse has an IRA and is 70½ or older, he can also give up to $100,000 each year.

How to Make a Donation
Story County Medical Center Endowment Foundation is a non-profit organization eligible for donations. You may contact your IRA custodian to transfer your desired amount. Any gift given to the "Choose SCMC. Expert Care, Close to Home" capital campaign is matched by Medicare reimbursements at a rate of 50%.

For More Information
It is wise to consult tax professionals if you are contemplating a gift under the new law.

For further information about any gift opportunities, please contact Barbara Gerlach, SCMC Endowment Foundation Liaison.

Send contributions to:

Story County Medical Center Endowment Foundation

630 Sixth Street

Nevada, IA 50201
 

Questions? (515) 382-7641

Your contribution is tax deductible to the extent allowed by law.