If you are over the age of 70 ½ or will be prior to the end of 2007, an important new law has been passed that can directly benefit you!

As of August 16, 2006, President Bush has signed into law a new law commonly referred to as H.R. 4. Under this new law, each person, over the age of 70½, with Traditional IRAs or Roth IRAs (hereinafter “IRA”) can make contributions to charities directly from his or her IRA up to a total of $100,000 per year (in 2006 and 2007) without incurring an income tax as a result of the distribution out of the IRA and with the result that the contribution will count against your minimum required distribution amount for the year! (referred to as a “Rollover” or “Qualified Charitable Distribution”).

1) If a donor makes a Qualified Charitable Distribution from his or her IRA, it will not result in income to the donor as a result of the distribution (i.e., it is NOT a taxable distribution).

2) Qualified Charitable Distributions count against your annual minimum required distribution.

3) Only distributions from IRAs or Roth IRAs will count. 401(k), 403(b), SEPs, Simple plans, and other retirement funds are not included.

4) Distributions may be made to public charities and cannot be made to a Private Foundation or Supporting Organization or be in the form of a split gift such as a charitable gift annuity or charitable remainder trust.

5) Qualified Charitable Distributions do not count against your Adjusted Gross Income limitation, meaning you get to deduct the contribution regardless of whether you have maximized your charitable giving for the year.

If you are over 70 ½ or will be in the next 2 years, have an IRA or Roth IRA and currently make gifts to charities out of your non-IRA assets (or plan to make charitable gifts), you should carefully examine this new law with your financial advisor, CPA and/or attorney.