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Current Charitable Gifts through Your IRA?Wednesday, July 21, the Senate passed the Reid/Baucus substitute for H.R. 4213 (the extenders bill). The legislation does NOT contain the larger package of extenders, including the “IRA Charitable Rollover Provision.” The House passed the revised legislation on July 22 and sent it to the President for signature. It is now highly unlikely that the IRA charitable rollover will be extended or enacted during 2010. During each of the past several years, Congress had allowed donors to make tax-free gifts from their IRA Accounts. In 2006 through 2009, if you were 70½ or older, you could make tax-free gifts totaling up to $100,000 each year from your traditional IRA to qualified charities. While you could not claim a charitable deduction for IRA gifts, your gift amount reduced your taxable estate, and you were not required to pay income tax on any amounts you distributed to qualified charities. This is not likely to happen again for 2010. An individual may still instruct an IRA plan administrator to make a direct contribution to a favorite charity. If a retroactive IRA charitable rollover law is passed, then this gift may qualify in accordance with the new law. However, it is more likely that any gift from an IRA account will be treated just like any other charitable gift. Most donors may offset income, including income received from their IRA accounts, by making contributions of the same amount to charity. Cash donations are usually limited to 50% of adjusted gross income. For more information, please contact us. Print this information in: Microsoft Word Document | Adobe PDF |
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