New Tax Break for Donors: IRA Rollover Extension

The recently enacted Economic Stabilization Act of 2008 contained an important provision extending the right of donors age 70½ or older to make gifts directly from a traditional or Roth IRA to a charity during 2008 and 2009. Such gifts will not be included in the donor’s federal taxable income in the year made (and will not generate an additional charitable deduction), but:

• Will count toward any minimum distribution required;
• Are not subject to Massachusetts income tax (which does not allow charitable deductions);
• Are not subject to the phase-out for itemized deductions for high income taxpayers; and
• Will not count toward the maximum charitable deduction allowed.

As with the previous legislation authorizing such gifts, a maximum of $100,000 may be contributed each year in this way, and gifts to donor advised funds and supporting organizations do not qualify.

For more detailed information, contact Katie Allan Zobel and Kristin Leutz, Directors of Development, or consult the Planned Giving Design Center.