Rolling Over an IRA: A Terrific Year-end Opportunity

I recently returned from a visit with a client in New Hampshire where I was informed that a donor had recently made a second gift to the capital campaign for $50,000 and did so through an IRA Rollover. You may still have time to share this terrific opportunity with a select group of your prospects and generate a lovely gift for your organization.

As you may have heard, The Emergency Economic Stabilization Act of 2008 included a provision that extended the availability of the IRA Rollover through December 31, 2009. This inclusion, included in the Pension Protection Act of 2006, had previously expired at the end of  2007 but was extended by then President Bush.

 Here are the details

The IRA Rollover allows individuals who are at least 70-1/2 to make tax-free distributions of up to $100,000 from an IRA to their favorite charity, subject to the following qualifications:

  • The donor must be 70-1/2 or older at the time of distribution.
  • Limited to $100,000 per taxpayer, per year. A married couple can donate up to $200,000 provided each spouse owns at least one IRA and can make a qualified charitable distribution of $100,000 from their plans.
  • Gifts must be outright. The contributions cannot be used to fund gift annuities or charitable remainder trusts
  • Applies only to IRA’s, not other forms of retirement plans such as 401(k), 403(b), etc.
  • Gifts cannot be made to donor advised funds and supporting organizations, including most private foundations.
  • Gifts must be made directly from the IRA to the charity.

Originally posted December 17, 2009.

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