Congress Signs IRA Charitable Rollover into Permanent Law

Mr. Smith, age 75, has accumulated approximately $2,000,000 in his IRA accounts. He has other sources of wealth and has plans to leave a sizable estate to his heirs and charity.   Under this law, Mr. Smith can create a fund at the community foundation to address the causes he cares about most by transferring IRA funds tax free. Mr. Smith can transfer up to $100,000 in 2015. In addition, if Mr. Smith is married, his wife can also make similar gifts from her IRA accounts, impacting the community in ways personal, unique and enduring.

CASE STUDY: Mr. Smith, age 75, has accumulated approximately $2,000,000 in his IRA accounts. He has other sources of wealth and has plans to leave a sizable estate to his heirs and charity.
Under this law, Mr. Smith can create a fund at the Community Foundation to address the causes he cares about most by transferring IRA funds tax free. Mr. Smith can transfer up to $100,000 in 2015. In addition, if Mr. Smith is married, his wife can also make similar gifts from her IRA accounts, impacting the community in ways personal, unique and enduring.

To make an IRA distribution through the Community Foundation, or to learn more, please call the Foundation at (518) 446-9638.

There is good news for Community Foundation donors in their 70s… and for the communities and causes they care about. On December 18, Congress passed the PATH Act, which renews and makes permanent the Charitable IRA provision of 2006, making it easier for Americans to give to causes they care about.

This provision has the power to help local charities strengthen their communities by allowing individuals to roll over up to $100,000 annually from an Individual Retirement Account (IRA) to charity without being federally taxed. (Prior to 2006, all lifetime distributions from IRAs were taxed—even those given to charity.)

Donors can now give far more to the causes they care about… with less coming out of their pockets! This may be an attractive giving option for  you if you are:

  • Over 70½ and now receiving minimum IRA distributions—but do not need the extra income.
  • Interested in making a significant lifetime gift to impact your community.

The Pension Protection Act of 2006 permitted individuals to roll over up to $100,000 from an IRA directly to a qualifying charity without being taxed. Single and married individuals 70½ and older are eligible to give in this way from their individual retirement accounts.

Using IRA assets to make a gift during your lifetime, as opposed to giving via bequest in your will, enables donors to experience the joy of making a major gift.