Economic Rescue Package Includes Help for Charities

Utica, NY – As part of the Emergency Economic Stabilization Act of 2008, the U.S. House of Representatives passed a two-year extension of Charitable IRA legislation, making it easier for Americans to give to causes they care about. The Charitable IRA provision, first enacted for 2006 and 2007, has the power to help local charities weather the current economic crisis. The extension goes through 2009.

In these financially turbulent times, millions of Americans continue to save pre-tax dollars in individual retirement accounts (IRAs). Thanks to regular investments and long-term returns, an estimated $4.7 trillion is invested in IRAs. The new law allows taxpayers 70 ½ and older to give retirement savings directly to charity, bypassing income tax to themselves or to their beneficiaries. The tax benefit expires December 31, 2009.

“It is a win-win—for people who would rather give to charity than pay taxes and for the nonprofit organizations they choose to support,” said Peggy O’Shea, president & CEO of The Community Foundation of Herkimer & Oneida Counties, Inc.

“For larger estates, a good portion of IRA wealth goes to estate taxes and income taxes of beneficiaries,” O’Shea said. “Experts estimate heirs may receive less than 50% of IRA assets that pass through estates.”

During 2009, holders of traditional IRAs who are at least 70½ years old can make direct charitable transfers up to $100,000 per year. A single person can transfer $200,000 free from federal tax; a married couple can transfer up to $400,000 free from federal tax from separate accounts. The Community Foundation of Herkimer & Oneida Counties can help donors execute the transfers and choose a charitable fund for their gift. Donor Advised Funds do not qualify for tax-free IRA transfers.

“This really is a limited-time offer,” said O’Shea. “For anyone interested in establishing a permanent fund and lasting legacy in this community, this is the opportunity of a lifetime to make the gift of a lifetime.”

The Foundation makes hundreds of grants yearly in support of causes ranging from education to health care, the arts to the environment. Grants are generated by the more than 260 funds, established and advanced by area individuals and families.

For more information about The Community Foundation, call 315-735-8212 or visit www.foundationhoc.org.

Economic Rescue Package Includes Help for Charities

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