IRA Gifts to Charities Made Easier by New Tax Law

A new federal law could help qualifying individuals reduce their tax liability while supporting charitable organizations like the Ocean Shores Friends of the Library. This new law, passed in 2006, applies to individuals over the age of 70 1/2 who hold traditional or Roth individual retirement accounts (IRAs). It allows IRA owners who meet the age requirement to make transfers from their IRAs directly to charitable organizations without paying tax on the distribution. Up to $100,000 per year during 2006 and 2007 can be transferred tax-free. Because these funds are not considered part of a donor's annual income, they do not increase his or her tax liability. In addition, they count toward the required minimum distribution.

Fortunately, now IRA gifts can be made simply and without tax complications. You may contribute funds this way if:

· You are age 70½ or older

· The gift is $100,000 or less each year

· You make the gift on or before 12/31/2007

· You transfer funds directly from an IRA

· You transfer the gift outright to one or more public charities that qualify

This information is not intended as legal, tax or investment advice. For such advice, please consult your attorney, tax professional or investment professional.