The Pension Protection of 2006 permitted an IRA charitable rollover for some taxpayers in 2006 and 2007. When the so-called "bailout" bill was passed recently, it extended this tax provision for all of 2008 and for 2009.
The IRA charitable rollover allows donations to be made by IRA owners or beneficiaries on or after the date they reach age 70 1/2. Such donations can be up to $100,000 per person in each calendar year.
The donations can go directly from an IRA to any legitimate charity. Donors won’t get a charitable deduction but they won’t have to recognize any taxable income, either. Because of quirks in the tax code, seniors generally will come out ahead with direct-from-IRA donations rather than withdrawing IRA funds and then making tax-deductible contributions.
