Great News! IRA Rollover Provision Extended

The IRA Rollover provision of the Pension Protection Act of 2006 has been extended through 2009.
What this means for you:
If you or your spouse have a traditional or a Roth IRA and are at least 70.5 years of age, you may make a gift to Colby using your IRA assets. This is a great way to support the College in this critical time without affecting your daily cash flow.

Benefits of an IRA gift:

  • You may give up to $100,000 without the distribution being included in taxable income (i.e., it is excluded from the donor's gross income).
  • Your gift can support the Colby Fund or another important Colby initiative of your choice.
  • You can make a gift to the Colby Fund without affecting your own cash flow.
Required Minimum Distribution:
Though no minimum distribution is required from IRAs in 2009, removing assets may lower your Required Minimum Distribution (RMD) in future years, so this remains a great way to help Colby and help yourself.
Judy '54 and Frank Totman '53
"I have always supported the Colby Fund, and through the continued IRA provision I was able to use my retirement account to make a gift without paying the income tax first. It just seemed like a wonderful way to make this gift."
—Judy Jenkins Totman '54
How do I make this happen?
  • To take advantage of this opportunity to help Colby, please call your IRA plan administrator to arrange for a direct transfer.
  • You must instruct the trustee to distribute the funds directly to a public charity, such as Colby.
  • Donors who transfer funds from an IRA should notify Colby's Office of Gift Planning of their transfer, since the transfers are anonymous and Colby will have no way of identifying the gift without this information.
  • Colby will provide appropriate documentation concerning its status as a qualified charity and acknowledgement of your gift.
  • If you need assistance or wish to get more information from the College, contact Susan Cook ’75 in the Office of Gift Planning by telephone at 1-800-809-0103 or by e-mail at plangift@colby.edu.
Sample Letters for IRA transfers to Colby
Sample letters for you to send to your plan administrator are available by clicking HERE.

Please review these rules to make sure your gift will qualify:
  • You must be 70.5 years of age or older at the time of the gift.
  • Your IRA rollover gift must be made to a qualified charity.
  • The transfer must go directly from your IRA to a qualified charity and cannot fund life income arrangements such as gift annuities or trusts.
  • Your IRA rollover gifts cannot exceed $100,000 per tax year.
  • The amount rolled over from your IRA will be excluded from your gross income.
  • There is no federal income tax deduction for the IRA rollover gift.
  • Gifts from retirement accounts other than IRAs—such as 401k, 403b, and SEP accounts—are not eligible.
  • Donors may be able to make qualified transfers of money from other accounts to their IRA and then make a charitable gift from their IRA. Please check with your tax advisor.
  • The IRA rollover provision is effective only through December 31, 2009.
Estate Gifts of IRA Assets
If you would rather consider a gift of your IRA through your estate plan in the future, that, too, is an extremely tax-efficient way of making a charitable gift.

Leaving IRA assets to charity is extremely tax efficient because, when inherited, heirs pay income and often estate tax on these accounts. Charities, however, do not pay income taxes, and the assets pass to charity free of any estate tax as well. This can translate into tax savings of up to 85 percent of the value of the account, depending on the size of the total estate and the heir's tax bracket. To make Colby a designated beneficiary of an IRA or other retirement plan, contact your plan administrator for a “designation of beneficiary” form, and let us know that you have done so.

Estate gifts of IRA assets qualify you for membership in the Willows Society and can help us reach our goal in the Reaching the World campaign. Please let us know your plans so we can provide this important recognition of your inclusion of Colby in your estate plans. Call Sue Cook '75, P'11, in the Office of Gift Planning, 800-809-0103, or complete the online Bequest Documentation Form.