Legislation supporting more charitable giving options for older Americans was introduced in the Senate recently.
The legislation, the IRA Charitable Rollover Facilitation and Enhancement Act, was introduced March 4 by U.S. Sens. Todd Young (R-IN), Michael Bennet (D-CO), James Lankford (R-OK), Catherine Cortez Masto (D-NV), and Maria Cantwell (D-WA). Officials said the legislation would amend the tax code to allow seniors to make charitable donations from their IRAs.
“Charitable giving has long been a way for Americans to support their local communities and causes they believe in. Our bill will make a small fix to the tax code to enable more flexibility for older Americans to generously give to the people, places, and organizations they care about,” Young said.
Currently, Americans over the age of 70 and a half can make Qualified Charitable Distributions (QCDs) from their IRA to a qualifying 501(c)3 without counting the distribution as taxable income. However, the law does not allow them to make those same donations to a donor-advised fund – a charitable giving account managed by a public charity. The exclusion prevents seniors from giving to multiple charities with one donation. The senators said their legislation would fix that prohibition.
“The IRA Charitable Rollover Facilitation and Enhancement Act will streamline the charitable donation process, empower Coloradans to do more with their giving, and direct larger amounts back to Colorado communities,” Bennet said. “Community foundations are one of the most powerful tools we have. They know their neighbors, understand local needs, and come up with creative ways to reinvest charitable contributions back into the places donors call home.”
The legislation is supported by American Endowment Foundation, Community Foundation Awareness Initiative, Council on Foundations, National Association of Charitable Gift Planners, National Christian Foundation, National Philanthropic Trust, Philanthropy Roundtable, among others.
Companion legislation was introduced in the House last year by U.S. Rep. Adrian Smith (R-NE) and Jimmy Panetta (D-CA).