FOR IMMEDIATE RELEASE
May 20, 1999
CONTACT: Lisette McSoud Mondello
SENATOR KAY BAILEY HUTCHISON INTRODUCES
'CHARITABLE IRA ROLLOVER' TO ALLOW IRA ASSETS TO BE TRANSFERRED TO CHARITY WITHOUT TAX PENALTY
Makes tax-free charitable giving easier
WASHINGTON, D.C. -- U.S. Senator Kay Bailey Hutchison (R-Texas) has introduced legislation that will allow donors to roll over assets from an IRA to a charity without incurring tax liability. Senator Richard Durbin (D-Illinois) is co-sponsoring the bill.
"Charitable giving is an American tradition, and this bill will make it easier to do," Senator Hutchison said. "It will provide a valuable new source of philanthropy for our nation's charities. Current law puts a roadblock in front of these kinds of donations."
Under the legislation, individuals age 59½ or older would be allowed to move assets without penalty from an IRA directly to a charity, or into a qualifying deferred charitable gift plan, such as a charitable remainder trust, pooled income fund or gift annuity. Current law requires taxpayers to first withdraw the IRA proceeds, pay the taxes due, and then contribute the funds to a charity.
Other co-sponsors include Senator Jesse Helms (R-North Carolina) and Senator Dianne Feinstein (D-California).
The new legislation will allow senior citizens who have provided for their retirement -- but find they do not need their entire IRA for living expenses -- to transfer IRA funds to charity without dilution.
The Hutchison-Durbin legislation has been endorsed by the American Red Cross, the American Association of Universities, the American Council on Education, the American Association of Museums, the American Institute for Cancer Research and 200 other charitable organizations in the United States.
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