ALERT: Act Fast for IRA Charitable Rollovers in 2015

Great news! The President made permanent the IRA charitable rollover as part of the latest tax bill signed late last week. But…

YOU MUST ACT FAST! To leverage the tax benefits in 2015, the IRA rollover must be transferred by December 31!

church givingThe IRA charitable rollover allows individuals age 70 ½ or older to make a rollover gift of up to $100,000 from their IRA to one or more qualifying charitable organizations. Charitable deductions are limited to 50% of a taxpayer’s adjusted gross income for a calendar (tax) year. Taxpayers that make significant charitable gifts will benefit from the rollover because this gift is excluded from the charitable deduction percentage limit.

Donations are excluded from the taxpayer’s income and will count as part of the IRA owner’s required annual withdrawal. The rollover must be distributed directly from the IRA custodian to the designated non-profit. (Rollover contributions are limited to specific qualifying charities – churches are eligible to receive these gifts.)

Here are the details you need to share with those in the qualifying age bracket:

  • The provision allows someone over 70 1/2 years of age to donate up to $100,000 of their IRA assets to a charitable organization.
  • The donor’s contribution can satisfy the required minimum distribution for the year and does not have to be counted as taxable income.
  • Those who qualify to make this gift need to seek counsel from their tax attorney or licensed financial planner for the details.

The Giving Pledge Update

I recently posted a blog regarding the challenge given by Bill Gates and Warren Buffet, called The Giving Pledge. In it, Gates and Buffet challenged the nation’s billionaires to pledge to give away at least 50% of their fortunes to charity, either at death or while still living.

to pledge

Buffet reports that roughly half of the people approached to participate have agreed to do so thus far. Great results and we’re barely two months into the challenge! The number one reason most high capacity donors share for not giving – “No one asked!”

The Leadership Challenge

In what is being called one of the biggest fund raising pitches in US history, Bill Gates and Warren Buffet recently launched a campaign to challenge the nation’s billionaires to give at least half of their fortunes to charity.

leadership challenge

Starting with the Forbes list of 400 wealthiest Americans, the initiative will challenge the group to pledge at least 50 percent of their net worth to charitable causes, either while still living, or at death. The combined net worth of the Forbes 400 in 2009 totaled an estimated $1.2 Trillion, meaning an additional $600 billion or more could flow to charity if all raised to the challenge. (For perspective, total charitable giving in the US has topped $300 billion in each of the last three years.)

Wow! Now that’s fun stuff. Lot’s of zeroes. Big names, internationally known. Huge headlines.

Charitable Contributions Breakdown

It’s always interesting to see where charitable contributions come from as you view the statistics from the Giving USA report. Here is the breakdown:

Where The Money Comes From

* Individual Giving – $229.3 Billion – 75% of the total in 2008

* Foundation Grants – $41.2 Billion – 13% of the total

* Charitable Bequests – $22.7 Billion – 7% of the total

* Corporate Giving – $14.5 Billion – 5% of the total