Smart Giving From Your IRA

A Tax-Saving Way to Help Children's National Hospital

Did you know that you can designate Children's National Hospital as the beneficiary of all or a percentage of your IRA and it will pass to us tax-free after your lifetime? It's simple, just requiring that you contact your IRA administrator for a change-of-beneficiary form or download a form from your provider’s website.

If you’re at least 59½ years old, you can take a distribution and then make a gift from your IRA without penalty. If you itemize your deductions, you can take a charitable deduction for the amount of your gift.

A Special Opportunity for Those 70½ Years Old or Older

You can take advantage of a simple way to benefit Children's National and receive tax benefits in return. You can give any amount up to $100,000 per year from your IRA directly to a qualified charity such as Children's National without having to pay income taxes on the money. This popular gift option is commonly called the IRA charitable rollover, but you may also see it referred to as a qualified charitable distribution (QCD).

Why Consider This Gift?

  • Your gift will be put to use today, allowing you to see the difference your donation is making.
  • You pay no income taxes on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your deductions.
  • If you reached the age of 70½ on or before December 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution for the year. If you turn 70½ on or after January 1, 2020, you can use your gift to satisfy all or part of your required minimum distribution starting at the age of 72. (Note: The RMD has been waived for 2020, per the CARES Act signed into law on March 27, 2020.)
  • Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.

Frequently Asked Questions

I've already named Children's National as the beneficiary of my IRA. What are the benefits if I make a gift now instead of after my lifetime?

By making a gift this year of any amount up to $100,000 from your IRA, you can see your philanthropic dollars at work. You are jump-starting the legacy you would like to leave and giving yourself the chance to see your philanthropy take shape. Moreover, you can fulfill any outstanding pledge you may have made by transferring that amount from your IRA as long as it is $100,000 or less for the year.

I'm turning age 70½ in a few months. Can I make this gift now?

No. The legislation requires you to reach age 70½ by the date you make the gift.

I have several retirement accounts—some are pensions and some are IRAs. Does it matter which retirement account I use?

Yes. Direct gifts to a qualified charity can be made only from an IRA. Under certain circumstances, however, you may be able to roll assets from a pension, profit sharing, 401(k) or 403(b) plan into an IRA and then make the transfer from the IRA directly to Children's National. To determine if a rollover to an IRA is available for your plan, speak with your plan administrator.

Can my gift be used as my required minimum distribution (RMD) under the law?

Yes, absolutely. If you reached the age of 70½ on or before December 31, 2019, you can use your gift to satisfy all or part of your required minimum distribution (RMD) for the year. If you turn 70½ on or after Jan. 1, 2020, you can use your gift to satisfy all or part of your RMD starting at the age of 72. Contact your IRA custodian to complete the gift. (Note: The RMD has been waived for 2020, per the CARES Act.)

When do I need to make my gift?

We must receive your gift by December 31 for your donation to qualify this year. If you have check-writing privileges on your IRA, please mail your check by December 18 in order to give us time to process your gift before the end of the year.

Do I need to give my entire IRA to be eligible for the tax benefits?

No. You can give any amount under this provision, as long as it is $100,000 or less per year. If your IRA is valued at more than $100,000, you can transfer a portion of it to fund a charitable gift.

I have two charities I want to support. Can I give $100,000 from my IRA to each?

No. Under the law, you can give a maximum of $100,000 per year. For example, you can give each organization $50,000 this year or any other combination that totals $100,000 or less. Any amount of more than $100,000 in one year must be reported as taxable income.

My spouse and I would like to give more than $100,000. How can we do that?

If you have a spouse (as defined by the IRS) who is 70½ or older and has an IRA, they can also give any amount up to $100,000 from their IRA.

Can I use the transfers to fund life-income gifts such as charitable remainder trusts or charitable gift annuities?

Unfortunately, the law does not allow a lifetime gift made directly from your IRA to fund a charitable remainder trust or charitable gift annuity.

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Next Steps

  1. Seek the advice of your financial or legal advisor.
  2. Use our free resource to make a tax-free donation from your IRA directly to Children's National. Children's National has partnered with FreeWill to provide their free tool to guide you through the process of making a Qualified Charitable Distribution in 10 minutes or less. It's simple to use and eases the burden of finding the correct forms online or long telephone wait times.
  3. Prefer working directly with your financial administrator? Contact your IRA administrator requesting to send a check from your account to Children's National. (To be tax-free, the donation must go directly from your account to Children's National without passing through your hands.)
  4. Questions? Contact Francena Jackson at 1.866.458.0686 or by email at mylegacy@childrensnational.org.
Personal Estate Planning Kit

Our Top Free Resource

This comprehensive estate planning kit helps you protect your family and establish your legacy. FREE!

Download My Kit