Your End of Year Giving Is as Easy as One, Two, Three
Charitable Deduction Planning for Alumni and Friends
You can help transform health care in our community and beyond by making a gift to TTUHSC El Paso. With your support, we will continue to expand our mission of serving more El Pasoans, funding life-changing research and educating the next generation of researchers, physicians, nurses and dentists.
End of year planning – now it’s time to plan!
Making a planned gift is a wonderful way to show your support of TTUHSC El Paso and its mission while accommodating your own personal, financial, estate-planning, and philanthropic goals. A planned gift is a commitment to the future of our campus – one that demonstrates your passion and creates the promise of opportunity for our future front-line health care heroes, research and patient care in our community.
If you have not yet taken your required minimum distribution for the year, your IRA charitable rollover gift can satisfy all or part of that requirement up to $100,000. To ensure your gift qualifies for 2020, make the transfer by December 31.
Reduce Your Income Tax through a Charitable Deduction
Under the SECURE Act that was enacted this past December, IRA owners and certain participants in qualified retirement plans are required to take distributions beginning at the age of 72. A charitable IRA rollover is a gift option that enables donors 72 (70 ½ if you reach 70 ½ before January 1, 2020) or older to transfer up to $100,000 directly from the donor’s IRA (or IRAs) to a qualified charity each year.
The Internal Revenue Service announced on June 23, 2020 that anyone who already took a required minimum distribution (RMD) in 2020 from certain retirement accounts now has the opportunity to roll those funds back into a retirement account following the CARES Act RMD waiver for 2020.
The 60-day rollover period for any RMDs already taken this year has been extended to August 31, 2020, to give taxpayers time to take advantage of this opportunity.
The CARES Act enabled any taxpayer with an RMD due in 2020 from a defined-contribution retirement plan, including a 401(k) or 403(b) plan, or an IRA, to skip those RMDs this year. This includes anyone who turned age 70 1/2 in 2019 and would have had to take the first RMD by April 1, 2020. This waiver does not apply to defined-benefit plans.
Additional benefits include:
- You’ll see the difference you’re making today
- You pay no income taxes on the gift. The transfer doesn’t generate taxable income or a tax deduction, so you benefit even if you don’t itemize your tax deductions
- You can count the amount of your rollover toward your requited minimum distribution (RMD) for the year
- You can create or add to a permanent endowment in your name or in memory of a loved one
- Regardless of your age, you can give from your IRA by naming us a beneficiary of your account. This is a great option for extending support from your IRA beyond your lifetime
- Here’s how:
- Decide what percentage you would like us to receive
- Contact your IRA administrator for a change-of-beneficiary form, or simply download a form from your provider’s website
- Name TTUHSC El Paso and the gift percentage on the form
- Return the form to your IRA administrator
- Let us know about your plans so we can thank you
How the New CARES Act May Affect Your Charitable Contribution
The CARES Act (Coronavirus Aid Relief and Economic Securities Act) makes a new charitable deduction available to individual taxpayers that do not itemize their deductions. This new benefit, also referred to as a universal deduction, allows for a charitable deduction of up to $300 per individual. This is an above-the-line contribution that is deducted from the individual taxpayer’s income prior to the calculation of their adjusted gross income. This is the one charitable giving benefit that will extend beyond the 2020 tax year
In addition to the new universal deduction, for 2020, the Act provides incentives for both individuals and corporations by increasing the available deductions on qualified charitable contributions to:
- 100% of their adjusted gross income for individual taxpayers who itemize their deductions. Beyond the scope of the CARES Act, the deduction for qualified charitable contributions made by itemizing individual donors is limited to 60% of their adjusted gross income
- 25% of taxable income for corporations. Up from the 10% limit which is generally applicable for corporations outside of the CARES Act
The Coronavirus Aid, Relief, and Economic Security (CARES) Act contains a variety of relief, notably the “economic impact payments” that will be made to people under a certain income threshold. But the law also makes some changes to retirement plan rules and provides a new tax break for some people who contribute to charity.