If you’re 70 and a half years old or older, we’ve got good news about tax-free giving options.
Last Friday, before getting on Honolulu-bound Air Force One, the President signed the Tax Increase Prevention Act of 2014 (HR 5771). What does this mean? If you are an IRA owner over age 70 and a half, you are once again able to transfer up to $100,000 from your IRA directly to the Honolulu Museum of Art without having to pay income tax on the distribution.
However, if you want to make this type of gift you need to act fast—Congress extended the IRA Charitable Rollover only for 2014. To complete your Rollover gift by Dec. 31, 2014, you need to contact your IRA administrator immediately.
The legislation is retroactive to Jan. 1—if you made a gift directly from your IRA to the museum earlier in the year (and met the other requirements), you can treat it as a charitable rollover gift. (Please let us know if this is the case so we can provide the appropriate substantiation letter.)
If you have already taken and received your 2014 required distribution in the usual way, unfortunately you cannot “convert” it to a charitable rollover gift. You can, however:
• make an additional withdrawal from your IRA as a charitable rollover gift, or
• make an outright gift from other assets to the Museum and receive an offsetting deduction.