IRA CHARITABLE ROLLOVER EXTENDED FOR TAX YEARS 2008 and 2009

Use Your IRA To Make a Tax-Free Gift to NYU!

Here’s some exciting news that can help you plan a tax-effective strategy for your IRA distributions in 2008 and 2009. Congress has extended the tax advantages for individuals who make a charitable gift from their IRA account.

So if you are 70 ½ years of age or older, you can make your gift to NYU from your IRA – entirely tax-free. And your IRA charitable gift will satisfy all or part of your required minimum IRA distribution for the year, so you can avoid tax on your required IRA distribution.

You can use your IRA charitable distribution to make your annual gift, satisfy your current pledge, or establish or add to a named scholarship or other permanent fund at NYU.

Here’s how it works: The IRA charitable gift provision allows otherwise taxable distributions from a traditional individual retirement account (IRA) to be excluded from gross income. While your IRA charitable gift is excluded from income, you do not also obtain a federal income tax deduction for this contribution. How does the IRA charitable gift differ from past tax treatment? Prior to this law, a donor had to report a withdrawal from an IRA as income. Any charitable contribution would be treated as an income tax deduction to offset that income. But due to a variety of tax rules, including deduction limitations and phase-outs, the net effect of increasing your income and then declaring a deduction may have resulted in an increase in tax for some donors. Congress’ extension of this giving opportunity offers a welcome incentive to donors who want to use the money in their IRAs to make charitable gifts. The legislation makes the process simple and assures these donors that their gifts will not increase their taxes.

The IRA charitable gift may be a particularly attractive tax strategy for the following donors:

• Donors who don’t need or want to take the required annual minimum distribution from their IRA.
• Donors whose income level is high enough to start “phasing out” their itemized deductions (married/joint filers at approximately $140,000; single filers at approximately $70,000).
• Donors who don’t itemize their deductions.
• Donors for whom additional income will cause more of their Social Security income to be taxed.

As with any arrangement that qualifies for favorable tax treatment, there are a few restrictions and conditions:

• You must be 70 ½ years of age.
• The limit for IRA charitable gift tax treatment is $100,000 per person per year.
• You must instruct your IRA custodian to make the distribution directly to NYU.
• Only outright charitable gifts are permitted. (Life-income gifts, such as charitable gift annuities or remainder trusts, are not permitted)
• Only gifts to public charities are permitted. (Gifts to donor-advised funds or private foundations are not permitted)
• You must make your gift from an IRA account. (Gifts from a 401(k) or 403(b) account are not permitted)

How to make your IRA charitable gift to NYU:

Instruct your IRA custodian to make a direct distribution from your IRA account to New York University. Contact your IRA custodian and request a form that contains the instructions for an IRA charitable gift. These forms are usually available through the custodian’s toll-free customer service phone number, or on its website.

Instruct your IRA custodian to send the distribution check to the following NYU address:
New York University
Office of the Treasurer
726 Broadway
2nd Floor
New York, New York 10003

(Tax ID 13-5562308)

Instruct your IRA custodian to identify you as the IRA account owner/donor – with your name and address – on its distribution check or accompanying materials.

Inform us that you are making an IRA charitable distribution by contacting Alan Shapiro, NYU Director of Gift Planning,
at (212) 998-6960 or by emailing him at gift.planning@nyu.edu.
Please call or email Mr. Shapiro if you have questions about the IRA charitable gift or for assistance with the gift process.

Thank you for your support of NYU!