IRA Rollover Poised to Make a Comeback

I have some good news.

The US Congress has begun the process to revive the Charitable IRA Rollover which expired at the end of 2014. Now, it’s time for you to take action.

On Tuesday, July 21, 2015, the Senate Finance Committee approved a number of tax extender provisions including the IRA Rollover. While the Committee considered making the IRA Rollover provision permanent, it ultimately settled on a two-year extension.

US CapitolFinance Committee Chairman Orrin Hatch (R-UT) said, “This markup [of the bill] will give the Committee a timely opportunity to act on extending a number of expired provisions in the tax code that help families, individuals and small businesses. This is the first time in 20 years where a new Congress has started with extenders legislation having already expired, and given that these provisions are meant to be incentives, we need to advance a package as soon as possible.”

Ranking Committee Member Ron Wyden (D-OR) said, “The tax code should work for, not against, Americans. We need to extend these tax provisions now in order to provide greater certainty and predictability for middle class families and businesses alike. However, as we look beyond next week, it’s critical we all recognize and take action to end this stop and go approach to tax policy through extenders.”

The House of Representatives has yet to take action though Rep. Paul Ryan (R-WI), Chairman of the Ways and Means Committee, remains interested in legislation that would make the IRA Rollover permanent. However, ultimately, the House might bring its thinking into alignment with the Senate Finance Committee. The House is expected to take up the issue as early as September.

When Democrats controlled the Congress, the IRA Rollover extensions were done a year at a time and often very late in the year. This made it challenging for both donors and nonprofit organizations to plan and to take full advantage of the provision.

With Republicans in full control of Congress, the House and Senate are considering the IRA Rollover provision earlier in the year and are considering a longer extension term. These are both good things for donors and charities.

It remains to be seen when final action will be taken and what that action will look like. It’s also unclear whether the Obama Administration will support the measure.

The Charitable Giving Coalition has long advocated for the IRA Rollover and other provisions that provide incentives for charitable giving. In addition to encouraging Congress to take action, the Coalition has sent the following letter to all Presidential candidates:

On behalf of the Charitable Giving Coalition, a diverse group representing public charities, private and community foundations and their grantees, as well as nonprofit organizations and the associations and umbrella groups that serve their needs, we would like to congratulate you on your candidacy for the office of President of the United States.

We realize that you will consider a number of policy issues — such as the budget, tax reform and other issues impacting tax policy — over the course of your campaign. As you contemplate any changes to the tax code, we respectfully request your support for preserving the full scope and value of the charitable deduction.

The charitable deduction is unique among itemized deductions in that it promotes a selfless act and encourages taxpayers to donate more funds to charities than they would otherwise give.

Charitable contributions allow our organizations to serve individuals, families and communities throughout the country. Proposals that would impose a cap, a floor, or any other limits on the deduction would impede the effectiveness of this vital incentive to give back to communities.

A calculation of the deduction suggests that our communities receive at least $2.50 of benefit for every $1 of tax benefit going to the donor. In 2014, individual Americans gave over $258.51 billion to support charitable causes, 83 percent of which was donated by those who itemized and likely claimed a charitable tax deduction, according to the annual Giving USA report.

Furthermore, nonprofit organizations that rely on charitable gifts to provide valuable services to communities have a powerful impact on the American economy. These organizations generate $1.1 trillion every year in the form of jobs and services. One in 10 U.S. workers is employed by the nonprofit sector, which provides 13.7 million jobs. Employees of nonprofit organizations received roughly nine percent of wages paid in the U.S., and the nonprofit sector paid $587.7 billion in wages and benefits in 2012.

Limiting the value of the charitable deduction would inhibit the ability of charities to serve individuals and communities across the country. As charities struggle to raise additional funds to meet increased demands for their services, we ought to encourage Americans to be more generous, not send a signal that giving is less important.

Congratulations again on your decision to run for President of the United States. We look forward to working with you and your staff on this important issue and are happy to act as a resource to you regarding philanthropy and charitable giving.


Association of Fundraising Professionals, Chair

Agudath Israel of America, Alliance for Charitable Reform, Alliance for Strong Families and Communities, Alliance of Nonprofit Mailers, American Alliance of Museums, American Institute for Cancer Research, American Jewish Committee, American Society of Association Executives, Americans for the Arts, Americans for the Arts Action Fund, Association of Art Museum Directors, Association of Christian Schools International, Association of Direct Response Fundraising Counsel, Community Foundation Public Awareness Initiative, Council for Advancement and Support of Education, Council for Christian Colleges & Universities, Council on Foundations, Dance/USA, DMA Nonprofit Federation, Dunham+Company, Educational Media Foundation, The Field Museum, Fraternity and Sorority Political Action Committee, Girl Scouts of the USA, Independent Sector, Jewish Federations of North America, Leadership 18, League of American Orchestras, National Association of Independent Schools, National Catholic Development Conference, National Catholic Educational Association, National Council for Behavioral Health, North American Interfraternity Conference, OPERA America, Partnership for Philanthropic Planning, Performing Arts Alliance, Philanthropy Ohio.”

Now, it’s your turn. Write and/or call your representative, senators, and presidential candidates to express your support for the IRA Charitable Rollover and other provisions that will benefit donors and the nonprofit organizations they support. Also, consider contacting your donors to encourage them to support the Charitable IRA Rollover and other giving incentives.

That’s what Michael Rosen says… What do you say?

2 Responses to “IRA Rollover Poised to Make a Comeback”

  1. Reblogged this on The Planned Giving Blog and commented:
    An early update on the IRA rollover provision!


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: