2014 IRA Charitable Rollover
Extended for Seniors Age 70½
Act before December
Great news! The President signed The
IRA Charitable Rollover
extension into law on December 19, 2014. This law provides a one year extension of tax provisions through December 31, 2014, retroactive to January 1, 2014.
The IRA Charitable Rollover has proven a popular way for donors to support their favorite causes, for the main reason that it enables donors to make a gift to charity directly from their IRAs and not include the amount distributed in their taxable income. Beyond making it easier to make gifts from their IRA, the charitable rollover can be advantageous to donors from a tax standpoint.
With an Individual Retirement Account "IRA" Charitable Rollover, also called a "qualified charitable distribution."
What is a Qualified Charitable Distribution?
A taxpayer may exclude from gross income the aggregate amount of his or her "qualified charitable distributions" that do not exceed $100,000 in a tax year. A "qualified charitable distribution" is any otherwise taxable distribution from an IRA that is:
- made directly by the IRA trustee to a public charity (not a private foundation or donor advised fund at a public charity); and
- made on or after the date on which the IRA owner has attained age 70 1/2.
An IRA owner who makes an IRA qualified charitable distribution in an amount equal to his or her required minimum distributions ("RMDs") is considered to have satisfied his or her minimum distribution requirement for that year, even though a charitable entity (and not the IRA owner) receives the distribution.
What is an IRA Charitable Rollover?
An IRA Charitable Rollover is a direct transfer of up to $100,000 from your traditional IRA to a qualified charity.
Who is eligible to make an IRA Charitable Rollover?
Any owner of a traditional IRA who is at least 70.5 years old is eligible.
How does an IRA Charitable Rollover benefit me?
Because the donation is made directly to a qualified charity, you benefit by not having to count the donated amount as income for tax purposes - this can be particularly helpful in excluding all or part of your required minimum distribution.
How long do I have to act?
Act now! You only have until December 31, 2014, to make your gift. It takes several days for an IRA plan administrator to process transfers so it is important that you act as soon as possible.
How do I make an IRA Charitable Rollover?
Contact your IRA trustee or administrator and instruct them to make the contribution from your IRA. They will have forms for you to complete -- or you can
download a copy of our sample letter
and send it directly to your IRA trustee or administrator.
Please contact your IRA trustee or administrator if you have any questions.