IRA Beneficiary Designation
How It Works
You name Penn Medicine as the beneficiary of your IRA, 401(k), 403(b) or other qualified plan.
After your lifetime, the gift comes to Penn Medicine tax-free.
You can escape income taxes by leaving it to Penn Medicine.
You can give the most-taxed asset in your estate to Penn Medicine and leave more favorably taxed property to your heirs.
You can continue to take withdrawals during your lifetime.
You can change the beneficiary if your circumstances change.
Qualified Charitable Distribution (QCD)
Individuals who are at least age 70½ at the time of the contribution.
How much can I transfer?
Up to $100,000 each tax year.*
*The recent enactment of the SECURE Act made changes to dollar limits on QCDs. Please check with your advisor to determine how those changes may impact you.
From what accounts can I make transfers?
Transfers must come from traditional IRAs directly to charity. If you have retirement assets in a 401(k), 403(b), etc., you must first roll those assets into an IRA, and then can make the transfer from the IRA directly to charity.
Can I use the transfers to fund life-income gifts like charitable remainder trusts or charitable gift annuities?
No, these are not eligible.
Can I make a transfer to my donor advised fund or supporting organization?
No, these are not eligible.
What are the tax implications?
- Federal – You do not recognize the transfer as income, provided it goes directly from the IRA provider to charity; you are not eligible for an income tax charitable deduction.
- State – Each state has different laws, so check with your own advisors. Some states have a state income tax and will include this transfer as income. Within those states, some will allow a charitable deduction and others will not. Other states base their state income tax on the federal income or federal tax paid. Still other states have no income tax at all.
Can the transfer qualify as my minimum required distribution?
Under the SECURE Act, retirement plan participants must take their Required Minimum Distributions (RMD) at age 72. If you are eligible, you may be able to satisfy all or part of your RMD with a Qualified Charitable Distribution (QCD).*
*The recent enactment of the SECURE Act made changes to the age eligibility for RMD and dollar limits on QCDs. Please check with your advisor to determine how those changes may impact you.
I’m over age 70½---should I consider a Qualified Charitable Distribution?
Yes, especially if:
- You do not itemize deductions but make charitable gifts, OR
- You are subject to the limitation on itemized deductions, OR
- You are required to take a distribution from your IRA that you just don’t need, OR
- Your charitable gifts already equal 50% of your adjusted gross income.
How do I execute a Qualified Charitable Distribution?
The sample letter can be used to send to your IRA plan provider. For additional questions contact the Office of Gift Planning at 215.898.6171.
For More Information
E-mail or call us at 215-898-9486.