Senate Tax Bill Extends IRA Charitable Rollover

December 10, 2010

The Pension Protection Act of 2006 allowed an individual taxpayer who had attained age 70 ½ to make distributions in 2006 or 2007 of up to $100,000 per year from an individual retirement plan (IRA) to one or more qualified charities and exclude such distributions from gross income. This provision, which was extended for distributions made in 2008 and 2009, expired after Dec. 31, 2009.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, which was introduced Dec. 9, 2010, would extend this provision for 2010 and 2011. A charitable rollover counts against the taxpayer’s IRA minimum distribution requirements, and for those taxpayers who have not yet made the minimum distributions for 2010, the Act as introduced would allow charitable rollovers made through January 2011 to be treated as if made in 2010. The Act, however, is not yet law. Anyone wanting to make an IRA charitable rollover in 2010 should monitor this legislation closely.

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