Special tax bill includes extended help for charities

December 29, 2015

On December 18, 2015, Congress passed the Protecting Americans from Tax Hikes (PATH) Act, which renews and makes permanent the Charitable IRA provision of 2006, making it easier for Americans to give to causes they care about. This provision allows individuals ages 70 ½ and older to distribute up to $100,000 annually from an Individual Retirement Account (IRA) directly to an eligible charitable organization, like The Spartanburg County Foundation, without being federally taxed.

Thanks to decades of deliberate saving, some of today’s retirees have more money in their IRAs than they need for daily living expenses and long-term care. Before provisions set by the PATH Act, income tax had to be paid on all IRA withdrawals, which reduced the value of charitable gifts. This new law does not count direct distributions to qualified charities as income and will not be subject to income tax, maximizing philanthropic donations.

“This is a great opportunity for individuals to use IRA assets to give back to our community,” said Troy Hanna, president and CEO of The Spartanburg County Foundation. “We, at The Spartanburg County Foundation, can aid individuals who wish to use IRA assets to make charitable gifts.”

The Spartanburg County Foundation can help facilitate transfers and provide several options for charitable giving, including The Community Fund. Donor Advised Funds do not qualify for tax-free IRA transfers. Gifts made by December 31, 2015 will qualify under the new law.