IRA Charitable Rollover Helps Abe and Anne Rossi Give Back Better

Ira Rolloever

Giving back is a part of life for Abe and Anne Rossi. “We’ve had many fallbacks in our life with the family business, but the Lord has always provided. We’ve felt blessed, and it is part of our philosophy to give to others,” Anne said. 

The Rossis are from Grand Rapids but lived in Saginaw for 30 years. They’ve been back on the west side, where they are enjoying an active retirement, since 1998. Anne was an elementary school teacher, and Abe ran a branch of his family’s commercial flooring business.

Meeting the Community Foundation

When they moved back to Grand Rapids in 1998, the Rossis met with their professional advisor, Aaron Pike of Variable Concepts. “We’d been out of the area for many years, so we asked, in addition to our church, can you recommend a place for our philanthropy. He said yes, Grand Rapids Community Foundation.”

That was nearly a decade ago, and they’ve been regular donors to the organization ever since.

“Before, we were giving to so many different organizations. When we found out all the different ways the Community Foundation helped different causes, it felt like a place to bring it all together,” Anne said.

Anne especially likes the Community Foundation’s support of public education. She started her teaching career at Stocking Elementary School—a school in the Community Foundation’s Challenge Scholars network. 

Finding a New Tax-wise Way to Give

This spring, when they Rossis met with Aaron to review their situation, they learned their annual charitable contributions would not meet the new higher threshold for itemized deductions. He recommended they do an IRA Charitable Rollover, or qualified charitable distribution, which transfers funds directly from their IRA to a nonprofit, like the Community Foundation.

The Rossis especially liked that they were able to use this strategy to give to their church, as well.

By using an IRA Charitable Rollover for their giving, the Rossis were able to:

  • Avoid income tax on the funds transferred from their IRA
  • Reduce their income because the rollover funds counted as part of their required annual minimum distribution
  • Give more than they usually would to support the causes closest to their hearts
  • Reduce the hassle of tracking their gifts and mailing in checks

“You don’t have to be a millionaire to share,” Anne said. “The process was easy and handled entirely by Aaron’s office.”

Know the Rules

Here are a few things to know about the IRA Charitable Rollover:

  • You must be 70 ½ or older at the time of the gift
  • Funds must be transferred from your IRA directly to a qualified nonprofit (funds cannot come to you in between)
  • The maximum rollover is $100,000 for a single person or $200,000 for a couple filing jointly.
  • Gifts to Donor Advised Funds or life-income arrangements (such as charitable gift annuities) do not qualify

To get started, contact your professional advisor or IRA administrator. It’s important to talk with them about the IRA Charitable Rollover rules and how they fit with your overall plan.

During this conversation, you may also inquire about naming a charitable organization as a beneficiary of your IRA, which can reduce the tax burden for heirs.

Questions? We’re Here to Help!

If you have questions about the IRA charitable rollover or other tax-wise ways to give back, please contact a member of our development team at 616.454.1751.