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T&E TALK: Charitable IRA Rollovers Extended Permanently!

Posted by Scott T. Ditman, CPA/PFS on Dec 28, 2015 10:05:00 AM
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On December 18th, Congress approved and President Obama signed legislation extending dozens of expired tax deductions, credits, and incentives, including charitable IRA rollovers.

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Individuals age 70 ½ and older can make tax-free distributions of up to $100,000 per year from their individual retirement account (IRA) to a public charity, such as a hospital or college. Donor advised funds are not eligible.

The distribution counts toward your “required minimum distribution,” is not subject to federal income tax, and is not deductible as a charitable contribution.

For individuals who have been waiting to make a 2015 IRA distribution directly to charity, there is still time but keep these delivery dates in mind: The IRS considers a donation “made” at the time of “unconditional delivery.”

What is “unconditional delivery?” The delivery date depends in part on what you donate and how. Here are a few examples for common donations:

  • Check. The date you mail it.
  • Credit card. The date you make the charge.
  • Pay-by-phone account. The date the financial institution pays the amount.
  • Stock certificate. The date you mail the properly endorsed stock certificate to the charity.

If you would like to learn more about and/or make an IRA distribution to a charitable organization, please contact me at sditman@berdonllp.com.

Scott T. Ditman, a tax partner and Chair, Personal Wealth Services at Berdon LLP, advises high net worth individuals and family/owner-managed business clients on building, preserving, and transferring wealth, estate and income tax issues, and succession and financial planning.

Topics: T&E TALK

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