Breaking News About Charitable Individual Retirement Account Rollovers

By Allyson Marks Greenfield

We have some good news to share. You can now plan charitable Individual Retirement Account (IRA) rollover gifts, year after year. On December 18, 2015, President Obama signed legislation indefinitely extending the charitable IRA rollover, with no expiration date. Here are a few of the details about this terrific opportunity to contribute in a tax-friendly way to your favorite charity.

What is a charitable IRA rollover?

The IRA Charitable Rollover provision allows individuals who have reached age 70½ to donate up to $100,000 to charitable organizations (such as CJE SeniorLife) directly from their IRA, without treating the distribution as taxable income.

How does this help me?

A charitable IRA rollover makes it easier to use IRA assets, during your lifetime, to make charitable gifts.

Why will lifetime IRA gifts be easier?

Under current law, withdrawals from traditional IRAs and certain Roth IRAs are taxed as income, even if they are immediately directed to a charity. The donor receives a tax deduction for his or her donation, but various other federal and/or state tax rules can prevent the deduction from fully offsetting this taxable income. As a result, many donors have chosen not to use IRA assets for lifetime gifts. The charitable IRA rollover eliminates this problem.

Is there a limit on the amount that can be given?

Yes, there is a limit. An individual taxpayer’s total charitable IRA rollover gifts cannot exceed $100,000 per tax year.

Can a gift be made to any charity?

No. Gifts to the following are excluded: Donor Advised Funds, supporting organizations and private foundations.

Can I still make a gift with an IRA Beneficiary Designation?

Absolutely! You can still designate CJE SeniorLife as a beneficiary to receive IRA assets in your will. The lifetime charitable IRA rollover is simply another option for donors who would like to see their philanthropy at work now.

More questions? Please contact Allyson Marks Greenfield at 773.508. 1130 or allyson.marksgreenfield@cje.net to answer specific questions about making a charitable donation to CJE.