Financial pros encourage 2015 IRA charity rollover 

The US Congress is notorious for last-minute approvals of tax-free IRA contributions to charities for people 70-and-1/2 or older.  In 2014 legislators waited until late December to approve the charitable IRA rollover retroactively for the year. 

By that time, many had already taken their minimum required distribution (RMD) or didn’t have enough time to direct an IRA gift to charity.

In 2015, CPAs and other financial professionals are telling their clients that if they want to direct some of their IRA to charity to do it.

 At worst,” writes financial adviser Michael Kitces, “if the rules are not reinstated, the outcome will be no worse than just being forced to take an RMD and making a charitable contribution anyway…. However, if the rules are brought back once again, those who make direct charitable distributions from their IRAs will enjoy all the benefits of QCDs (qualified charitable distributions)… even if the rules are only ‘fixed’ after the fact!”

 Kitces cautions that if Congress does not allow the charitable IRA rollover in 2015, the offsetting charitable deduction may not perfectly match the tax due on the IRA distribution, but adds, “While there may be some ‘tax slippage’ in applying the deduction against the income, for most it will be relatively slight.”

The Congress has approved the charitable rollover every year since 2006.  The legislations allows individuals 70-and-1/2 or older to have their IRA custodian send distributions to charities of up to $100,000, with the distribution passing tax free to charity and counting as the required minimum distribution.  No charitable deduction is allowed, because the tax-free transfer has the benefit of a perfect deduction, even for those who do not itemize.

CPA Christi Bender feels there is a good chance the IRA provision will be extended again adding, “If Congress does not extend it, you will have still satisfied your minimum distribution requirement, and the amount transferred to the charity will still count as a charitable contribution.”

For further information on charitable IRA rollovers, contact our planned giving specialist Phil Murphy at 415-457-7482 or


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