2015 IRA Charitable Rollover
The IRA charitable rollover legislation passed by Congress has been signed by the President. This law extends the IRA charitable rollover retroactively for 2015 and makes it permanent. The legislation is part of a larger package on other tax extenders and the budget.
Under this legislation, if you are 70 ½ or older, you will be allowed to make certain charitable contributions directly from your Individual Retirement Account (IRA) to an eligible charity, and the transferred assets will not be recognized as income for tax purposes.
As a rule, withdrawals from IRAs are taxed as income; you would receive a tax deduction for your donation, but other federal, and sometimes state, tax rules can prevent the deduction from fully offsetting taxable income.
The charitable IRA rollover, or qualified charitable distribution, makes it easier for you to use your IRA assets to make charitable gifts. It is a special provision that allows individuals age 70 1/2 or older to exclude from taxable income – and count toward their required minimum distribution – transfers of IRA assets, up to a total of $100,000, that are made directly to public charities, such as Grace Episcopal Church, the Grace Episcopal Church Foundation or your favorite charity. To take advantage of the extension for 2015, donors need to arrange a direct transfer from their IRA to an eligible charity by December 31, 2015. Direct transfers from IRAs to an eligible charity made earlier in 2015 in anticipation of the IRA charitable rollover being extended will also count.
Making a donation under this provision is simple and straightforward. If you would like to make a contribution to such as Grace Episcopal Church, 341 Washington Ave, Traverse City, MI 49684 or Grace Episcopal Church Foundation (same address) from your Individual Retirement Account, please speak with your IRA administrator today.
Thanks to the Episcopal Church Foundation for their assistance in writing this article.