Senator John Thune (R-SD) has introduced the Charities Helping Americans Regularly Throughout the Year Act, which among other things would allow tax free contributions from IRAs.
The legislative summary of the legislation is as follows:
This bill amends the Internal Revenue Code to modify several tax provisions affecting charitable contributions and tax-exempt organizations.
The Internal Revenue Service may determine the standard mileage rate for deducting the cost of using a passenger automobile for charitable purposes (currently set by statute at 14 cents per mile), and the rate may not be less than the rate for medical purposes (17 cents per mile for 2017).
The bill modifies the substantiation requirements for charitable contributions to eliminate an exemption for contributions that are reported on a return filed by a tax-exempt organization.
Tax-exempt organizations must file their returns in electronic form.
The bill excludes from the gross income of an individual who is at least 70-1/2 years of age up to $100,000 in distributions from an individual retirement plan to a donor-advised fund (DAF). The bill also modifies disclosure requirements for DAFs.
(A DAF is a fund or account that is separately identified by reference to contributions of a donor or donors. The account is owned and controlled by a sponsoring charitable organization, while the donor retains advisory privileges with respect to the distribution and investment of funds in the account.)
The bill reduces from 2% to 1% the excise tax on the investment income of private foundations and eliminates a provision that reduces the rate to 1% if a foundation meets certain distribution requirements.
The bill exempts certain philanthropic business holdings from the tax on excess business holdings of private foundations if a foundation meets requirements for exclusive ownership, donating all profits to charity, and independent operation.
Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal.