IRA Charitable Rollover Expires Dec. 31

As you prepare for your end-of-year giving, we want to be sure you are aware that the Charitable IRA Rollover legislation expires at the end of this year.

What is Charitable IRA Rollover?

The Charitable IRA Rollover allows individuals to direct transfers of funds from Individual Retirement Accounts (IRAs) to qualified public charities without having to count the distributions as taxable income until December 31, 2011. The 2010 Charitable IRA Rollover expires on December 31, 2011.

What are the requirements for participation?

Applies only to people 70.5 and older
Individuals are limited to a $100,000 gift per year
Must be a direct transfer from IRA
Only standard IRAs and Roth IRA accounts qualify under this law; 401(k)plans and other tax-favored retirement planning vehicles cannot be used to make an IRA rollover gift
These contributions do not qualify donors for an additional charitable income tax deduction. (not being taxed on the withdrawal is worth even more than a standard charitable deduction)
Donors must receive no personal benefits from this gift nor are they available for planned gifts such as charitable remainder trusts, donor advised funds or gift annuities.

What are the tax incentives from Charitable IRA Rollover?

Meets minimum required distribution requirement
For those individuals who have not yet taken their IRA Required Minimum Distributions (RMDs) for 2010, they may partially or wholly satisfy that requirement through an IRA rollover gift made by January 31, 2011.
Doesn't increase Adjusted Gross Income (AGI) which would trigger multiple negative tax consequences
Avoid 50% limitations on contributions
Opportunity to give away " Double Taxed" IRA assets
Eliminate taxation on minimum distribution

The IRA Rollover provision is a significant opportunity for donors who:

hold assets in their IRAs that they do not need
would like to make a large one-time gift
are subject to the 2% rule that reduces itemized deductions
do not itemize