Good news just in time for the New Year. Congress has reauthorized the IRA Charitable Rollover for 2015. This means you still have time to contribute directly from your Traditional or Roth IRA to an eligible charity and receive the tax benefits of this charitable rollover. Under the IRA Charitable Rollover for 2015, if you are required to take a taxable mandatory distribution each year from your Traditional or Roth IRA, you can now donate directly to an eligible charity from your IRA trustee up to $100,000 without having to count the contribution against your taxable income.

Looking for a worthy cause to support with your IRA Charitable Rollover?

Consider these outstanding organizations that need your help:

  • Holocaust Museum and Learning Center (HMLC)
  • St. Louis Naturally Occurring Retirement Community (NORC)
  • Saul Brodsky Jewish Community Library
  • Jewish Federation of St. Louis

To learn how to take advantage of the IRA Charitable rollover, please see the details below.

Who benefits from the IRA rollover?
  • Individuals who take mandatory minimum withdrawals, but don’t need additional income. You can give your required distribution to a qualified charity without having to count in your taxable income.
  • Taxpayers who don’t itemize their deductions. The IRA rollover most benefits Americans who do not itemize deductions on their tax returns and thus do not receive a tax benefit for charitable contributions.
  • Itemizing taxpayers who’ve reached charitable giving limit. Donors who itemize are prohibited from deducting more than 50 percent of their adjusted gross income for making charitable donations. Donations from IRAs are excluded from the percentage limit, allowing those who have reached the 50 percent limit to give more.
What you need to know to take advantage of an IRA rollover

Mandatory Distribution. If you are required to take a taxable mandatory distribution from your Traditional or Roth IRA before December 31, 2015, you can make a charitable contribution up to the distribution amount as long as you meet the following requirements:

  • Age Requirement: You are 70 1/2 years old or older when the distribution is made.
  • Eligible Retirement Accounts: Distributions can only be made from traditional Individual Retirement Accounts or Roth IRAs. Charitable donations from 403(b) plans, 401(k) plans, pension plans and other retirement plans are ineligible for the tax-free treatment.
  • Eligible Charities: Charitable contributions from an IRA must go directly to a public charity that is not a supporting organization. Contributions to donor-advised funds and private foundations do not qualify for tax-free IRA rollover contributions.
  • Donation Limit: Your total charitable IRA rollover contribution cannot exceed $100,000 per year.
  • Directly to the Charity: Distributions must be made directly from the IRA trustee payable to the public charity before December 31, 2015.
  • No Gifts in Return: Donors cannot receive any goods or services in return for charitable IRA rollover contributions in order to qualify for tax-free treatment.

For questions, please contact Tim Henry at 314-442-3774 or THenry@JFedSTL.org.

Professional Advice. Please consult with your tax professional if you are considering an IRA rollover gift as nothing herein is intended to be considered professional advice.

IRS CIRCULAR 230 DISCLAIMER “Pursuant to regulations governing the practice of attorneys, certified public accountants, enrolled agents, enrolled actuaries and appraisers before the Internal Revenue Service, unless otherwise expressly stated, any U.S. federal or state tax advice in this communication is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of (i) avoiding penalties that may be imposed under federal or state law or (ii) promoting, marketing or recommending to another party any transaction or tax-related matter(s) addressed herein.”