About IRA Charitable Rollovers

The Pension Protection Act of 2006 created a new way to give to a favorite charity such as the South Seattle Community College Foundation. For the first time, donors 70 years old or older will be allowed to make direct transfers from their Individual Retirement Accounts (IRA’s) to benefit a charity.

This is a great way to benefit South and its students while enjoying significant tax benefits. IRA distributions are ordinarily subject at to federal income tax; but these distributions will be tax-free. Moreover, individuals who are 70 ½ or older are ordinarily required to take so-called minimum distributions (withdrawals) from their IRA each year. The charitable IRA rollover counts as a minimum distribution.

There are some restrictions:

• The current law only allows IRA rollovers during 2006 and 2007. Your rollover must be completed by December 31 of the applicable year.
• Charitable distributions are limited to $100,000. Couples can contribute up to $200,000.

If you are interested in making an IRA contribution or other form of charitable gift, please contact us.