What is it?

The IRA charitable rollover allows taxpayers to make tax-free charitable gifts directly from their Individual Retirement Accounts to eligible charities, meeting the annual required minimum distribution. 

Recent success

The IRA Charitable Rollover Expansion was signed into law in December 2022 by President Biden as part of the Omnibus Spending Bill, which, among its provisions, was the Securing a Strong Retirement Act. This law enables the maximum annual contribution, previously $100,000, to an IRA Charitable Rollover to increase each year based on the annual rate of inflation (the Consumer Price Index or CPI). Additionally, the legislation allows seniors to use their IRA to fund a gift annuity, enabling middle-income seniors to make charitable contributions while maintaining retirement income. In 2024, the CPI inflation adjustment provided under the law raised the maximum annual contribution limit from $100,000 to $105,000. The new limit for 2025 is $108,000.

What is the ideal policy?

The Nonprofit Alliance calls on Congress to expand the IRA Charitable Rollover legislation by lowering the minimum age to establish one from 70 1/2 to 65.

Why do nonprofits care?

With 10,000 Baby Boomers turning 65 each day, expanding this law means significantly more resources going to support nonprofits and charitable causes. Expanding the IRA Charitable Rollover is important not just for large donors but also for mid-level and smaller donors, as the average IRA Charitable Rollover gift is $7,600.