IRA Restricted Funds
Restricted Funds are established to accept Qualified Charitable Distributions (QCD) from an Individual Retirement Account (IRA)
Taxpayers who are 70½ years old or older may make a qualified charitable distribution (QCD) of up to $100,000 directly from a taxable IRA instead of taking a required minimum distribution.
Claiming a QCD allows donors to avoid ordinary income recognition. Generally, there is a greater income tax savings resulting from the avoidance of taxable income than there would be if a donor recognized the taxable income and then claimed an itemized deduction for a charitable contribution of the same amount.
How it Works
- QCDs enable individuals to fulfill their required minimum distribution by a direct transfer of up to $100,000 to charity.
- QCD’s can be made from a traditional IRA, inherited IRA and inactive Simplified Employee Pension (SEP) plans. The QCD is a direct transfer that never passes through the hands of the IRA holder
- Married couples can elect to have each spouse make a QCD up to the $100,000 limit for a potential total of $200,000.
- Since QCDs cannot be made to donor-advised funds we have developed a specialized Restricted Fund.
Some benefits of a QCD include:
- Satisfaction of the minimum distribution requirements
- Reduced gross income
- Favorable tax treatment
How to get started:
- Download a copy of the Restricted Fund Agreement (for a fund accepting QCD’s).
- Review and complete the agreement and mail it to: Foundation for Jewish Philanthropies, 2640 N. Forest Rd., Getzville, NY 14068
- If you prefer, you can email the agreement to Irv Levy Irv@JewishPhilanthropies.org
How will my fund be managed and how much will it cost?
Accounts with a lowest daily value during the year of under $25,000
Your account will be invested in the Foundation’s Balanced Investment Pool and will not be subject to market value fluctuations (calculated without regard to income, gains and losses.) As you select the charities of your choice, your account will have a liquidity value equal to the total of what you have donated, minus the grant distributions you have requested and a modest $62.50 quarterly fee, which will be used to support the Foundation’s efforts to serve our community and make the world a better place for all.
Annual Fees Schedule**
IRA Restricted Fund fees assessed by the Foundation assist us in carrying out our charitable mission and cover administrative costs associated with your Fund.
Fees will be charged on a quarterly basis at the greater of:
Net Account Earnings or, $250 /annually
Accounts with a lowest daily value during the year of over $25,000
Your account will be invested in the Foundation’s Balanced Investment Pool* and will have a liquidity value reflective of market value, including credited interest and dividends, and subject to market fluctuations. There will be a modest 0.25% quarterly fee, which will be used to support the Foundation’s efforts to serve our community and make the world a better place for all. Accounts over $500,000 are eligible for reduced fees.
ANNUAL FEE SCHEDULE**
IRA Restricted Fund fees assessed by the Foundation assist us in carrying out our charitable mission and cover administrative costs associated with your Fund.
25% of the annual fee will be charged on a quarterly basis at the greater of:
- 1% of total fund assets for the first $500,000
- 0.8% of total fund assets for the next $3.5 Million
- 0.5% of total fund assets for the next $2 Million
- 0.3% of total fund assets for the next $4 Million
- 0.15% of total fund assets for amounts over $10 Million
- Minimum annual fee $250
*Legacy Funds (or funds meeting other criteria specified by the Foundation) may be eligible for individualized investment programs.
** Fees are subject to change upon 90 days written notice
The Foundation for Jewish Philanthropies would be honored to assist you and your family in preserving your legacy.
Irving H. Levy, Executive Director
(716) 204-1139 • 716-390-9653 • Irv@jewishphilanthropies.org
The Foundation for Jewish Philanthropies does not provide legal or tax advice. The information herein is general and educational in nature and should not be considered legal or tax advice. The Foundation makes no warranties with regard to such information or results obtained by its use, and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information. Consult an attorney or tax professional regarding your specific situation.