EXCERPT REGARDING TAX TREATMENT OF DONATIONS TO PYC FOUNDATION
Subject to various possible limitations, a donation to the Foundation by an individual or business is deductible in computing taxable income under federal tax law. Donations can also be made by private and public foundations and donor-advised funds.
A copy of the formal exemption letter issued by the Internal Revenue Service to the Foundation can be found on the Foundation website at PequotYCFoundation.org Alternatively, a copy will be sent by email if a request for it is addressed to: info@PequotYCFoundation.org
If an individual is at least 70 and 1/2 years old and has a traditional (not Roth) IRA, it is often advantageous to make a donation directly from the IRA to the Foundation as a “qualified charitable distribution” (”QCD”). If an individual implements a QCD from his or her IRA, the amount of the distribution will not be included in the individual’s federal taxable income, so it is as good as getting an itemized deduction for a donation made directly from the individual’s non-IRA resources; it is often actually better in that the reduction in taxable income can favorably affect other calculations on his or her return. An individual is permitted to donate to charity up to $100,000 yearly from his or her IRA as a QCD.
Depending on an individual’s particular circumstances, other strategies may have attractive tax advantages including, for example, making the donation in the form of appreciated publicly-traded stock. A member of the Foundation board will be happy to help by working with your accountant, attorney or other advisor in considering any donation strategy.