IRA Charitable Rollover

On December 18, 2015, Congress passed and the President signed into law the IRA charitable rollover provision of the Trade Facilitation and Trade Enforcement Act of 2015. The new law has made permanent the opportunity for qualified donors to make gifts from their IRA accounts to one or more charities without incurring income tax on the withdrawal.

This is an excellent opportunity to make a gift during your lifetime from an asset that would be subject to multiple levels of taxation if it remained in your taxable estate.  Transfers must be made by Dec. 31 for gifts to be counted toward the required minimum distribution (RMD) for that year. 

Important details and restrictions:

  • You must be at least 70 1/2 or older when you make your gift, and the gift must be made from an IRA--no other requirement plans (such as 401k, 403b, or SEP accounts) qualify. 
  • Your gift must come to the MBF outright -- it cannot be used to establish a life-income arrangement or support a donor-advised fund.
  • The maximum amount a donor may transfer is $100,000 per year.
  • Although the distribution will be free from income tax, it will not generate an income tax charitable deduction.

The administrator of your IRA will make the actual distribution to the MBF.  For your convenience, please use this sample letter of instruction to send to your IRA administrator.  Donors with check-writing ability for their IRAs may use this feature to complete their gift.