Secure 2.0

When President Joe Biden signed into law the Consolidated Appropriations Act, 2023, he approved provisions collectively known as “Secure 2.0” that make important changes to the retirement savings landscape. The changes are designed to improve access to workplace retirement plans and retirement savings rates.

They also may affect your giving, making it easier for your support to make a bigger impact at the University of Montana than you might have thought possible.

Here are three important Secure 2.0 provisions which may affect your charitable giving:

1. Increases the required minimum distribution (RMD) age

For many years, the required minimum distributions from an IRA and certain other retirement plans had to begin when the account owner attained age 70½, but the SECURE Act, enacted in 2019 raised that age to 72. Secure 2.0 has further raised that age to 73 for those who attain age 72 between January 1, 2023, and December 31, 2032, and to 75 for those who reach age 74 after December 31, 2032. The minimum age at which you can make a qualified charitable distribution from your IRA to a charity remains at 70½.

How could this affect me?

Simply put, the extension of the RMD age gives you more time to save. You will enjoy additional tax-free growth. It can also be significant if you do not want to begin withdrawing retirement funds during an unsettled economic climate, giving you more time for your investment portfolio to recover.

2. Adjusts for inflation the $100,000 annual limit on direct gifts to qualified charities from your IRA

Are you 70½ or older? If so, you may know about a popular gift option known as a qualified charitable distribution, or QCD, that allows you to make a gift directly from your IRA to the University of Montana Foundation without paying income taxes on the distribution. Historically, the amount you could give was capped at $100,000 per year. This figure will now be adjusted annually for inflation beginning in 2024.

How could this affect me?

This change will allow you to not only increase your charitable giving, but also ensures that your giving keeps pace with inflation.

3. Allows for a distribution from your IRA to fund a life-income gift

If you are 70½ or older, you can make a one-time election for a qualified charitable distribution of up to $50,000 from your IRA to fund a life-income gift such as a charitable gift annuity or charitable remainder trust.

How could this affect me?

These types of life-income gifts allow you to make a gift to the University of Montana Foundation and receive lifetime payments to boost your retirement income in return.

Rather than taking a lump sum from your IRA, which would normally be taxed as ordinary income, this method turns the withdrawal into a stream of smaller payments taxed over your and/or your spouse’s lifetimes.

Contact Us to Learn More

Alison SchultzPlease contact Alison Schultz, senior director of planned giving,
at 406-243-5121 or to learn more.

The University of Montana Foundation provides information about the benefits of charitable gifts and does not provide legal, financial or tax advice. Additional details may apply. Please consult your advisor(s) before making a gift.