Tuesday, February 25, 2014

AHCA/NCAL Joins Efforts to Reinstate and Enhance the IRA Charitable Rollover

A number of critical charitable giving incentives, including the IRA charitable rollover, were allowed to expire on January 1, 2014, along with scores of other temporary tax provisions. Efforts are underway in Congress to reinstate these provisions into law, and AHCA/NCAL recently joined the Independent Sector and close to 500 organizations from across the country in sending a letter to all 100 U.S. Senators advocating to protect the charitable giving incentives. The letter also includes support for bipartisan legislation (the Public Good IRA Rollover Act - S.1772) that has been introduced by Senator Chuck Schumer (D-NY). This legislation not only creates certainty by making the IRA charitable rollover permanent; it also makes important improvements by eliminating the cap on distributions and provides donors greater flexibility in their charitable giving. 

Originally created by the Pension Protection Act of 2006 as a way to encourage older Americans to make gifts to charities, the IRA charitable rollover provision in the tax code allows individuals age 70½ to donate up to $100,000 to a qualifying public charity directly from his or her IRA without incurring tax on the withdrawal. According to the Independent Sector, during the first two years the IRA charitable rollover was available, it prompted more than $140 million in charitable donations, with the median gift just under $4,500. Beneficiaries included social service providers, skilled nursing care centers, religious organizations, cultural institutions – organizations that benefit communities and improve lives every day.

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