Key Senate Committee Advances IRA Charitable Rollover Extension

Posted by National Association of Charitable Gift Planners on Apr 9, 2014 4:44:19 PM

Although the IRA Charitable Rollover lapsed at the end of 2013, Congress is now poised to renew this important tax provision for all of 2014 and 2015 in the months ahead.
Most recently, on April 3rd, the Senate Finance Committee approved tax “extenders” legislation, sending the matter to the full Senate for consideration.


The bill, known as the Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act, would retroactively extend roughly $85 billion worth of tax provisions that lapsed on December 31, 2013 for a two-year period (i.e., January 1, 2014 through December 31, 2015). This legislation does include the IRA Charitable Rollover provision which has long been a legislative priority of PPP. The IRA Charitable Rollover permits an Individual Retirement Account owner who is age 70½ or older generally to exclude from gross income up to $100,000 per year in distributions made directly from the IRA to certain public charities. The Joint Committee on Taxation has estimated this two-year retroactive extension of the IRA Charitable Rollover will cost the government nearly $1.8 billion over 10 years.

Senator Ron Wyden (D-OR), who was elevated to Chairman of Senate Finance earlier this year and pushed the tax extenders legislation through his committee, has said there is presently no schedule for when the legislation will hit the Senate floor for votes, although it is widely expected that extenders legislation will be approved by Congress at some point later this year, but perhaps not until after the November elections.

Chairman Wyden did say, however, that this would be the very last tax extenders bill to see the light of day while he is Chairman and pledged instead to move forward on a comprehensive overhaul of the tax code. In fact, Chairman Wyden included “sense of the committee” language in the extenders bill to express strong support for such comprehensive tax reform. Specifically, the extenders bill states that any such reform efforts should eliminate temporary provisions from the tax code, boost the economy through the tax code, broaden the tax base by lowering tax rates, and ensure an appropriate baseline is used. Importantly, the bill also states that comprehensive tax reform will begin in earnest in the next Congress and conclude prior to the expiration of this latest round of tax extenders, which would be by the end of 2015.

Over in the House, Ways and Means Committee Chairman Dave Camp (R-MI), who earlier this year unveiled his own comprehensive tax reform plan, has finally agreed to allow a vote on tax extenders like the IRA Charitable Rollover, albeit at a date uncertain. Chairman Camp is planning a series of committee hearings to scrutinize every provision up for renewal in the extenders package. The first hearing was scheduled for April 8th and focused on the business-related provisions and not the IRA Charitable Rollover.

PPP will continue to monitor any developments related to an IRA Charitable Rollover extension as it moves through Congress.

Topics: Advocacy, General