The gift of the permanent charitable IRA rollover

Charitable IRA rollovers for eligible individuals are permanently signed into law.

December 23, 2015

It is the "giving season" and last week President Obama underscored that sentiment when he signed into law the Protecting Americans from Tax Hikes of 2015 (PATH). This legislation not only renews charitable IRA rollovers for 2015 but indefinitely reinstates these tax-free distributions – up to $100,000 – for eligible individuals.

To qualify for this special provision, the distribution must be made directly from an Individual Retirement Account to a “qualified charity,” which is generally a public charity. This provision allows eligible donors to exclude from taxable income certain transfers of IRA assets that are made directly to public charities.

Gifts to Seattle Foundation’s grantmaking programs qualify for this preferred tax treatment. In past years, donors have enjoyed supporting GiveTogether and the Scholarship Fund with their IRA Charitable Rollover. Gifts to Donor Advised Funds, Supporting Organizations and split-interest trusts such as Charitable Remainder Trusts do not qualify.

While PATH is welcomed news and eliminates one source of uncertainty surrounding charitable planning, other types of gifts may provide donors with more tax benefits.

For the past 70 years Seattle Foundation has been providing world-class advising and research to help philanthropists create equality of opportunity in our communities. Let us know if you'd like to talk with a Philanthropic Advisor about your year-end giving plans, as there are tax-related benefits to your philanthropy to consider before December 31.

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