Jan 5, 2013

Act Now: IRA Charitable Rollover Reinstated

The American Taxpayer Relief Act of 2012, signed into law by President Barack Obama on January 1, 2013, has tax benefits for people with Individual Retirement Accounts making distributions to charities before February 1. Federation General Campaign Chair Robert G. Berrin and Foundation Chair John M. Bussel sent a message to members of Miami’s Jewish community to explain how to take advantage of the tax benefits while supporting your Jewish community. Below is the text of the message.

Assets in your IRA are among the most highly taxed, subject to both income and estate taxes. From 2006 to 2011, the IRS, through the IRA Charitable Rollover, permitted taxpayers age 70½ or older to make a tax-free distribution of up to $100,000 per year to a qualifying charity from their IRAs. Until this rule lapsed in 2011, Federation donors were able to use IRA Charitable Rollovers to pay Annual Campaign and capital campaign commitments, make supplemental gifts or establish permanent endowments.

We are pleased to report that, as part of the new legislation, individuals can once again make tax-free distributions from Individual Retirement Accounts for 2012 and 2013.

Amounts paid directly to the charity from a donor's IRA for 2013 count toward the donor's required minimum distribution from the IRA and do not have to be included in the taxpayer's income. In addition, a special rule permits distributions taken in December 2012 to be transferred to charities tax-free before February 1, 2013. Another special rule permits certain distributions made before February 1, 2013 to be deemed made on December 31, 2012.

Anyone who has an IRA should consider how the IRA Charitable Rollover can benefit themselves or a family member. Don't miss this limited opportunity to make a meaningful gift to your Jewish community in this most tax-advantaged way. Because the chance to redirect an already-made distribution or to make an additional distribution for 2012 expires at the end of January, we encourage you to call Foundation Director Stephen Lande or Federation Chief Financial Officer Stephen Schwartz at 305.576.4000 for further information, or consult your tax advisor or IRA administrator at your earliest convenience. Thank you.

Robert G. Berrin
General Campaign Chair
Greater Miami Jewish Federation

John M. Bussel
Chair of The Foundation
of the Greater Miami Jewish Federation