(Revised January 14, 2009)

The Pension Protection Act of 2006 (PPA) permitted individuals to roll over up to $100,000 from an individual retirement account (IRA) directly to a qualifying charity without recognizing the assets transferred to the qualifying charity as income. While this provision expired on December 31, 2007, the Emergency Economic Stabilization Act of 2008 (H.R. 1424), enacted on October 3, 2008, extended the IRA charitable rollover provision so that eligible contributions may now be made through December 31, 2009. Note that the new law simply extends the charitable rollover and did not make other substantive changes to the operations of the provision.

The law uses the term "qualified charitable distribution" to describe an IRA charitable rollover. A qualified charitable distribution is money that individuals who are 70½ or older may direct from their traditional IRA to eligible charitable organizations. The provision has a cap of $100,000 for charitable distributions from individual IRAs each year. Individuals may exclude the amount distributed directly to an eligible charity from their gross income.