Jim and Arlene Moorehead are no strangers to community involvement. For decades they served on nonprofit boards and county commissions, Jim most recently on the Community Foundation board and Arlene on the Mendocino Film Festival board. Having lived both on the coast and inland, they have an appreciation for all of Mendocino County.
Through their participation on nonprofit boards, the Mooreheads became familiar with most of the IRS rules regarding charitable giving, but they hadn’t paid a lot of attention to the tax ramifications for the required minimum distributions on retirement accounts. “I guess you don’t pay attention to some of these things until they affect you directly,” says Jim.
“In the past few years we have had to withdraw money from our IRAs and pay taxes on the withdrawal amount, which meant that quite a bit ended up going to state and federal taxes. After working on local issues like broadband, I know that federal and state governments are often not responsive to local needs, especially in rural communities. So when I read the article about Roger Foote and Chuck Vaughn using their IRAs to open a fund at the Community Foundation, it rang a bell. Transferring (or ‘rolling over’) the required IRA distribution to selected and qualified local nonprofits and having it be used for projects in our county seemed like the right choice. We’re fortunate — we don’t need all of our retirement funds to live on, so why not give some back — tax-free — to this place we love?”
Local philanthropy is a key selling point for Jim and Arlene. Arlene remembers when they both worked for a big corporation and gave money through payroll deductions to a national charity. “That was during the time there were scandals involving some of the big charities. At that time I realized it made sense to switch our giving to our own community so we can see how much of a difference we are making. We support the ‘shop local’ movement and the ‘local food’ movement, so local giving goes along with that.”
To complete the IRA rollover, the Mooreheads contacted their financial adviser who arranged the paperwork. They decided to give directly to six local charities and six funds within the Community Foundation. The largest distribution will “seed” a new endowment fund that will provide ongoing help for seniors.
Arlene explains, “We like that the Moorehead Fund for Seniors can pool gifts from many folks, and we chose seniors because ‘we are one’ and thought other aging baby boomers might also be interested in contributing to such a fund. When I delivered for Meals-on-Wheels several years ago it was a real eye opener for me when I saw how many seniors are living on the edge.” Jim adds, “Services are often few and far between. When a friend of ours from the coast needed radiation treatment, he had a great network of friends with cars who provided transportation over the hill. It made me think of what happens to people who don’t have the same resources or network.”
In terms of the many causes and organizations they intend to support, Jim and Arlene are practical. “This will be a test year,” Jim says. “We are giving to well established organizations as well as to some start-up groups. We’re willing to take some risks and see how they do, and then evaluate again next year.”
Arlene adds, “A lot of our giving also stems from knowing people who serve on boards and having admiration and respect for their work. Overall we feel fortunate to be able to help. It makes us feel so good that we wonder why we didn’t do this before now.”
If you would like to discuss the charitable IRA rollover, or to talk about creating an estate fund with the Community Foundation, please contact me at [email protected] or call 707-468-9882. The Community Foundation of Mendocino is a nonprofit organization that offers many options for individuals to give back in ways that make a difference in our community. To learn more, visit www.communityfound.org.
Megan Barber Allende is the chief executive officer of The Community Foundation of Mendocino County.