IRA IRA Rollover

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Will the charitable IRA rollover be made permanent?

Powerful giving provision could be made into law

May 26, 2015 | by Phillip Buchanan


Will the charitable IRA rollover be made permanent?

Two congressional bills have been proposed this year to allow more Americans to transfer funds from their individual retirement accounts (IRA) to charitable organizations.  Among other details, these proposals would restore, expand, and make permanent the charitable IRA rollover.

The two new bills under review by Congress are:

  • America Gives More Act of 2015 (H.R. 644) – If made permanent, this law would allow IRA owners age 70 ½ years or older to make a direct, tax-free transfer of up to $100,000 a year from their IRA to a public charity like Duke University.  On May 14, 2015, the bill was approved by the Senate and will be sent to the president for review.
  • Public Good IRA Rollover Act of 2015 (S. 1159) – Originally introduced on April 30, 2015, this bill seeks to remove the giving cap of $100,000 and allow donors to make rollovers beginning at age 59 ½ years.  This would allow donors to take advantage of the incentive at a much earlier age and without limitations on the amount.

The purpose of these new proposals is to replace the former charitable IRA rollover provision, originally created by the Pension Protection Act of 2006.  The charitable IRA rollover provision allows individuals age 70½ years and up to make a tax-free donation of up to $100,000 to a qualifying public charity directly from an IRA.  (Otherwise, the IRA owner would have to pay taxes on the IRA funds before claiming the deduction.)  This benefit is available to all taxpayers, regardless of whether they itemize their deductions.

On December 19, 2014, President Obama signed into law the Tax Increase Prevention Act of 2014 (H.R. 5771), which extended the charitable IRA rollover through December 31, 2014.  Unfortunately, this extension expired at the end of 2014 and was not renewed by Congress.

Although these two new proposed bills have strong congressional support, they are currently tied to other “must pass” tax legislation with pressing deadlines.  Ultimately, this means that it will take some time for the proposed bills to move forward and gain momentum.

Duke’s Office of Gift Planning fully supports the America Gives More Act and the Public Good IRA Rollover Act, and we are hopeful that these bills we be made into permanent laws.  We will be sure to keep you posted as these proposals move along.

There are many reasons why the charitable IRA rollover may be beneficial to both you and Duke University.  Some of these benefits include:

  • Results in a direct transfer to charity with no taxable income to you.
  • The donation counts toward your annual required minimum distribution.
  • You can make an immediate gift to a place you care about or to an area of Duke that is most meaningful to you.

Duke's Office of Gift Planning is available to work with you and your financial advisors to develop a gift plan that meets your personal and philanthropic goals.  If you are interested in learning more about supporting Duke’s future, please visit our website or contact us today.

About the author

phil-buchanan-headshot

Phillip Buchanan Senior Philanthropic Counsel for Duke University

Phil is a veteran of development and gift planning who considers it a privilege to help good people celebrate the joy of giving. He serves as Duke’s senior philanthropic counsel and helps donors, professional advisors and Duke Development officers evaluate the best options for making a charitable gift to Duke. He has been featured in publications such as BusinessWeek and Kiplinger’s. When he’s not at work, Phil attempts to solve the mysteries of the universe for his three inquisitive young sons.

Phillip Buchanan can be contacted via email or by phone at (919) 681-0467.

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