Planning Pointer
Q&A with Our Donors - Part 1
Published October, 2006
Here are just a few of the questions posed from some of our donors and the resulting answers:
Q: I am possibly coming into some money due to the pending sale of a business. I would like to know how to avoid the burden of having to pay significant taxes on this money, mainly by the benefits of making donations to nonprofits.
A: You would be able to avoid the capital-gain tax on any of your stock that you give to our institution prior to the sale of the company and receive a charitable deduction for its value. The purchasers would then buy our institution's stock along with yours, and our institution would get the cash at that point.
Q: Can a commercial annuity that I own be rolled into a gift annuity, and will that bypass any taxes that might be owed?
A: No: the only solution would be to cash them in, pay whatever tax, and take out a gift annuity.
Q: I have an IRA question...actually, two:
- Is there a maximum limit to the amount I can draw out of an IRA annually, or can I simply cash in the whole thing if I desire?
- Can I leave the entire residue of an IRA to charity even if I have heirs? Or is there some rule that a portion must go to heirs?
A: Yes, you can withdraw your entire IRA account, if you wish. If you are under 59½, there could be a 10% early withdrawal penalty.
Yes, generally you can leave the entire IRA residue to charity. Depending on state law, a surviving spouse may have elective rights against the account but not children or other heirs.