My Time at Browne & Nichols Taught Me How to Think
The Knights’ Circle recognizes BB&N donors who have given for five or more consecutive years. The Circle includes Peter McManmon ’66, who now gives with qualified charitable distributions from his IRA, and has several reasons for his stalwart support.
“BB&N was a tremendously productive and enjoyable experience for my sons,” [Lifers Robert ‘00 and Skip ‘03], Peter notes. Moreover, when his sons attended BB&N, Peter and his wife Linda were very active parents who thoroughly enjoyed being part of the parent community.
Most importantly, Peter cites his own excellent B&N education in explaining his dedicated giving—35 consecutive years and counting. “My time at Browne & Nichols taught me how to think,” he says, “and also taught me how to write and problem solve.”
Using problem solving, Peter recently started supporting the school in a smart way: through a qualified charitable distribution (QCD) from his individual retirement account (IRA). This solved a problem he faced after the 2017 Tax and Jobs Act capped state and local tax deductions at $10,000: Peter no longer received a tax benefit from his charitable donations because he had switched from itemizing to taking the standard federal tax deduction. By giving directly from his IRA, he could make a tax-free distribution that would also count toward his required minimum distribution (RMD).
“It’s the equivalent of doing an itemized charitable deduction while at the same time taking the standard deduction,” Peter explains. While it’s a savvy way to give, there are certain requirements: the IRA owner must be at least 70 ½ at the time of the donation and while a donor can support several charities this way, their total annual gifts through a QCD cannot exceed $100,000.
For IRA owners 72 and older who fail to take their full RMD, the IRS taxes the amount not withdrawn at 50%. Peter never worries about this whopping tax penalty because he fulfills his RMD with QCDs, directing gifts directly from his IRA to charity. “If you take a $100 distribution [from your IRA], you're going to be taxed on $100. If, however, you give $50 to BB&N [as a QCD] and take $50 out, you're going to be taxed on [just] $50.”
With BB&N's QCD tool, you can download the appropriate forms or learn more about the benefits of giving from your IRA.
Check with your financial adviser to find out if a qualified charitable distribution [QCD] is right for you.