The IRA Charitable Rollover has been permanently extended! Here's what it means for you:
If you're age 70½ or older, you may be able to take advantage of an important incentive for charitable giving. Congress recently re-authorized and made permanent the provision that allows donors to make gifts from their IRA accounts to one or more charities, without first incurring income tax on the withdrawal. This means that you can direct that amount to a fund at Grand Rapids Community Foundation with no federal income tax liability. This IRA Rollover may provide you with an excellent opportunity to make a gift during your lifetime from an asset that would be subject to multiple levels of taxation if it remained in your taxable estate.
The bill makes the tax-free IRA rollover retroactive to January 1, 2015, which means gifts transferred directly from a donor's IRA to us at any point during 2015 will qualify as a rollover gift.
There are just a few other details and restrictions to consider:
You must be 70½ or older when you make your gift, and the gift must be made from an IRA; unfortunately, no other retirement plans (such as 401k, 403b or SEP accounts) qualify.
Your gift must come to the Community Foundation outright - it cannot be used to establish a life-income arrangement or support a Donor Advised Fund.
Although the distribution will be free from income tax, it will not generate an income tax charitable deduction.
There are other details which we'll be happy to guide you through.
If you're interested in taking advantage of the IRA Charitable Rollover, the administrator of your IRA will make the actual distribution. You can ask them to contact me or my colleague Shaun Shira at (616) 454-1751. As always, we are here to help!