Thank you for your gift in the amount of $300.00 from your Individual Retirement Account to Loyola University New Orleans. We are writing to acknowledge that we received your gift postmarked October 31, 2019. Therefore, all or a portion of your gift may qualify as a qualified charitable distribution from your IRA under section 408(d)(8) of the Internal Revenue Code and the Protecting Americans from Tax Hikes Act of 2015.
In that connection, we warrant to you that our organization is qualified as a public charity under section 170(b)(1)(A) of the Internal Revenue Code and that your gift was not transferred to either a donor advised fund or a supporting organization as described in section 509(a)(3). Please note: A QCD is not a tax-deductible charitable gift. A QCD may, however, count towards the annual IRA required minimum distribution (RMD) and not be deemed taxable income.
Should this gift fall outside of your RMD, it may be tax deductible in whole or in part as a charitable contribution. Please consult your tax advisor to determine whether and to the extent to which your donation may be deductible. Please retain this letter with your important tax documents and provide a copy to your tax preparer.
In that connection, we warrant to you that our organization is qualified as a public charity under section 170(b)(1)(A) of the Internal Revenue Code and that your gift was not transferred to either a donor advised fund or a supporting organization as described in section 509(a)(3).
Is none of the above necessary?
None of that is necessary. Postmarks are essentially irrelevant as they prove little generally. But when it comes to certain IRA payments what matters is when the check is cashed - not mailed.An IRA should look like any other gift receipt. It confirms when you received or processed the gift - never implying a legal date of the gift. And it should identify whether the payment was a QCD versus an RMD as those have very different tax treatments.Sometimes the issuing financial institution will send a confirmation letter you may need to execute. But generally speaking, your standard receipt indicating what type of IRS payment you received is sufficient.JohnJohn H. TaylorPrincipalJohn H. Taylor Consulting, LLC2604 Sevier St.Durham, NC email@example.com (cell/text)Serving the Advancement Community Since 1987
Can you provide clarity around the rule you mentioned about when the IRA checks are cut or cashed, not mailed.
We have a situation where the donor had her QCD mailed to her home, she included a letter to us that it had be cashed prior to 12/31, then mailed both to the campus general mail center which was closed during the holiday break (our university was closed 12/23 through 1/2). By the time the mail center re-opened, sorted the mail, and figured out that the check was for Advancement (it didn't say so on the outside), we didn't get the check in hand until Monday.
The check itself is dated 12/20. I'm not sure what to tell her – can we issue a 2019 receipt to her? It won't matter though if the IRA administrator doesn't recognize it as her RMD, correct? She will have penalties.
Thanks from a newbie,
Aimee S. Fitzgerald, MLIS
Interim Director, Gift Accounting
William & Mary
ForTheBold.wm.edu | #WMForTheBold
Thanks, John. Appreciate the confirmation!
Susie Brown Director of Gift Administration University of Illinois Foundation p 217.300.7000 // f 217.333-5577 // e firstname.lastname@example.org