Charitable IRA Rollover

Charitable IRA Rollover Extended for 2010 and 2011

Among items included in the Tax Relief Act, signed into law by President Obama on December 17th, was an extension of the Charitable IRA Rollover provision through the end of 2011. This rollover provision gives you the opportunity to help HSJC and the dogs and cats in our care between now and the end of the year. The following are some important points you need to remember:

·         Individuals age 70 ½ and older may once again request direct transfers of funds from Individual Retirement Accounts (IRAs) to the Humane Society of Johnson County without income tax on gifted funds.

·         The funds must be directly transferred from IRA accounts to HSJC (donors should ask their IRA custodians for special forms to make these requests).

·         Each individual is entitled to make a total of $100,000 in gifts to charities each year under this provision.

·         2010 IRA rollover gifts can be made through January 31, 2011.

·         For those individuals who have not yet taken their IRA Required Minimum Distributions (RMDs) for 2010, they may partially or wholly satisfy that requirement through an IRA rollover gift made by January 31, 2011.

·         These contributions do not qualify donors for an additional charitable income tax deduction as not being taxed on the withdrawal is worth even more than a standard charitable deduction.

·         Only standard IRAs and Roth IRA accounts qualify under this law; other retirement accounts such as 401(k), 403(b), SEP, KEOGH, and SIMPLE IRA plans cannot be used to make an IRA rollover gift.

The provision is a significant opportunity for donors who:

·         hold assets in their IRAs that they do not need;

·         would like to make a large one-time gift;

·         are subject to the 2% rule that reduces itemized deductions;

·         do not itemize; or

·         plan to leave part or all of their IRA to HSJC at death