Q: I have a question concerning the rollover of IRAs upon reaching age 70 1/2 in the U.S. Can a U.S. citizen roll a portion of the IRA into a Canadian charity without incurring the income tax? As it is necessary to start withdrawal by this age—and the income is not needed—would this be a way of giving to a Canadian university that the donor alumni are currently supporting?
A: Yes, Tim, you can make a tax free charitable rollover from a U.S. IRA to most Canadian universities and colleges.
You can donate up to $100,000 (USD) as long as you are at least 70 ½ years of age; the rollover donation is made by a direct trustee to charity transfer.
You MUST be sure to verify first that your organization qualifies for the charitable rollover, so check your university’s website or call their office that handles donations. This resource should help.
Cleo Hamel is a senior tax specialist with American Expat Taxes in Calgary
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