CLUMC Foundation Committee

MAKE A TAX-FREE GIFT WITH YOUR IRA
New Tax-Savings for Donors Aged 70½ and Older

When the President signed into law the Pension Protection Act of 2006 on August 17, 2006, he and the Congress provided you a new way to encourage additional charitable giving.

You can give up to $100,000 in 2006 and again up to $100,000 in 2007 directly from your IRA to a qualified charity (such as Clear Lake UMC). You can do this with your required minimum distributions. These funds will not be counted as taxable income.

A few of the new law’s provisions are:

• Only seniors aged 70½ and older can take advantage of these new IRA giving rules.

• Your gift isn't counted as taxable income, and you do not have to itemize deductions on your tax return to take advantage of this tax-free gifting.

• Gifts must be from traditional or Roth IRAs--not 401(k)s, 403(b)s, or other types of defined contribution plans, and not SEP or SIMPLE plans. You can, however, roll part or all of your 401(k) plan (or other company retirement plan) into a traditional IRA and then do your gifting.

• The money must come out of the IRA and be paid directly to the charity. Don't write a check to yourself and then gift the money. 

• The charity must be a public charity. This includes CLUMC, but excludes gifts made to charitable trusts, donor advised funds, and supporting organizations.

• Qualifying IRA contributions to charity will affect only pretax contributions. If you've made nondeductible contributions, your cost basis will remain intact.

This is a great new way to make a gift to CLUMC without having to pay income tax on the funds used to make the gift. Because the gift will be tax-free, it may enable you to consider giving a larger gift than you had previously considered. You can make the gift now and witness the benefits of your generosity through the ministry of our church.

If you are interested in learning more about this new charitable giving opportunity, and how you might benefit your church and your family, please contact the church office at 281.488.5110, or contact Royce Thompson, Chairperson of the CLUMC Foundation, 281.481.4387.

Chairperson Royce Thompson Members: Jim Brackeen Royce Thompson Dave King Juliet Markovich John Faulk Tom Benson