In late 2015, Capitol Hill made permanent three important tax incentives for charitable giving, including the IRA charitable rollover and enhanced deductions for the donation of food inventory and land conservation easements. After years of renewal and expiration, including the most recent expiration on January 1, 2015, this permanency ends the uncertainty caused by the repeated expiration and subsequent reinstatement of these charitable giving incentives.
The tax extenders package, known as the Protecting Americans from Tax Hikes (PATH) Act of 2015, included 22 permanent tax breaks. Notably, it extends the special IRA rollover incentive for gifts completed in 2015 and future years, allowing people who are 70½ or older to donate up to $100,000 to a charity directly from their Individual Retirement Accounts (IRA) without treating the distribution as taxable income.
These giving incentives make a difference. During the first two years the IRA charitable rollover was available, it spurred more than $140 million in gifts to nonprofit organizations. For years, a strong and vocal contingency from the charitable community urged lawmakers to permanently extend the IRA Rollover, stressing it makes a powerful impact in communities across the country and also benefits older Americans. Their voices were heard. Bottom line: the permanent enactment of these giving incentives will give charities improved access to much-needed resources.