Thanks, John. How can I tell if this particular account is a QDC or RMD? The check just says, "No State or Federal Taxes withheld - Rollover IRA."
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Shea Sadler
University of South Alabama
ssadler@southalabama.edu------------------------------
Original Message:
Sent: 06-17-2025 09:41 AM
From: John Taylor
Subject: IRAs-Bifurcation
The bifurcation issue arises only when the non-deductible portion cannot be paid separately without an additional contribution.
For example, if you require a $1,000 payment to join an association, which includes $250 in tangible benefits, you cannot permit a $750 payment from a third-party charity and pay $250 privately.
However, if a donor can become a member of an association by paying only $250, without paying anything else, there is no bifurcation.
To answer your last question, yes. Bifurcation issues apply to QCDs, but not RMDs.
John
John H. Taylor, PrincipalJohn H. Taylor Consulting, LLC
2604 Sevier Street
Durham, NC 27705
919.816.5903 (cell/text)
Serving the Advancement Community Since 1987
Original Message:
Sent: 6/17/2025 10:28:00 AM
From: Shea Sadler
Subject: RE: IRAs-Bifurcation
Hi John,
I am tagging in on this post for some additional clarification. I understand the difference between the QDC and RMD, but I have received two checks from a donor to pay for a membership with benefits. They paid the Charitable portion with a Check with the Donor's name at the top written on a Charles Schwab account. The check also states, "No State or Federal Taxes withheld - Rollover IRA." They included a separate personal check for the benefits portion. This act, makes me think it would be bifurcation, but I wasn't positive since I not sure if this is a RMD or QDC account. Thank so much for your clarification and advice!
Shea
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Shea Sadler
University of South Alabama
ssadler@southalabama.edu
Original Message:
Sent: 02-03-2025 02:04 PM
From: John Taylor
Subject: IRAs-Bifurcation
There are two forms of IRA distributions. RMD (Required Minimum Distributions) have no restrictions as the donor has paid taxes on the entire withdrawal.
QCDs (Qualified Charitable Distributions) must be used entirely for a charitable purpose. Like a DAF or a private foundation gift, bifurcation is not allowed. The premise is the same: The donor would not have been eligible to pay separately for the benefit if not for the QCD payment. That's an impermissible benefit.
On the other hand, if anyone could purchase the benefit at FMV without making a gift, that's fine!
John
John H. Taylor, PrincipalJohn H. Taylor Consulting, LLC
2604 Sevier Street
Durham, NC 27705
919.816.5903 (cell/text)
Serving the Advancement Community Since 1987
Original Message:
Sent: 2/3/2025 2:59:00 PM
From: Dena Toth
Subject: IRAs-Bifurcation
Do the same Bifurcation rules apply to IRA rollovers as with DAFs? Can a donor pay separately for goods/services received?
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Dena Toth
Medical University of South Carolina Foundation
tothd@musc.edu
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