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Press Releases 2011

IRA Charitable Rollover Extension creates a special opportunity to be part of the cure

(January 4, 2010) - A popular charitable gift planning tool for Diabetes Research Institute Foundation donors was among many provisions included in the recent tax bill that passed Congress and was signed into law by President Obama on December 17, 2010.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (H.R. 4853) extends the IRA Charitable Rollover until December 31, 2011. In addition to extending these qualified charitable distributions, the new law also allows gifts made by January 31, 2011 to be treated as 2010 donations and to be used to satisfy the taxpayer’s minimum distribution requirement for 2010.

Due to this extra month, donors can actually transfer up to $200,000 tax-free from their individual retirement account (IRA) in 2011 by making a transfer of up to $100,000 by January 31, 2011 and making another transfer by December 31, 2011. 

The new law is a special opportunity for those who wish to help the Diabetes Research Institute capitalize on promising research avenues to eradicate this devastating disease.

“Charitable gifts from our donors are helping our research scientists bring us closer to a cure every day, so the extension of the IRA charitable rollover is extremely good news for those who are committed to finding a cure for their loved ones and millions of others with diabetes, said Robert A. Pearlman, president and chief executive officer of the Diabetes Research Institute Foundation.  “The tax bill which was passed near the end of December allows donors to take advantage of this short window of time to make 2010 qualified charitable distributions.”

The IRA Charitable Rollover was first enacted on August 17, 2006, as part of the Pension Protection Act of 2006. Taxpayers who are 70 1/2; and older are required to make annual distributions from their individual retirement account (IRA), which are then included in the taxpayers’ adjusted gross income (AGI) and subject to taxes. The IRA Charitable Rollover permits those taxpayers to make donations of up to $100,000 directly to charitable organizations from their IRAs without counting them as part of their AGI and, consequently, without paying taxes on them. 

A distribution to a donor advised fund or to establish a charitable remainder trust or charitable gift annuity does not qualify for tax-free IRA rollover contributions. Under the law, qualified distributions must be made before January 1, 2012.

Jill Shapiro Miller, vice president of gift planning at the DRI Foundation, works closely with professional advisors to help them meet the charitable planning goals of their clients.  “This extension of the IRA charitable rollover provides a great option for those creating a charitable giving plan,” she said.  “As always, we suggest that our donors discuss these issues with their professional advisors. We welcome the opportunity to work with our supporters and their advisors to help achieve their personal and charitable objectives.”

 
IRA Charitable Rollover Extension: Key Points

• Eligible Charities. Charitable contributions from an IRA must go directly to a public charity.  Contributions to donor-advised funds, charitable remainder trusts or charitable gift annuities do not qualify for tax-free IRA rollover contributions.

• Eligible Retirement Accounts. Distributions can only be made from traditional Individual Retirement Accounts or Roth IRAs. Charitable donations from 403(b) plans, 401(k) plans, pension plans, and other retirement plans are ineligible for the tax-free treatment.

• Directly to the Charity. Distributions must be made directly from the IRA trustee payable to the public charity.

For more information, contact:

Jill Shapiro Miller
Vice President of Gift Planning
Diabetes Research Institute Foundation
954.964.4040 or 800.321.3437
jshapiro@drif.org
 


 

 

Diabetes Research Institute Foundation
200 S. Park Road, Suite 100
Hollywood, FL 33021
[P]   (954) 964-4040
[TF] (800) 321-3437
[F]   (954) 964-7036

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