Generation to Generation

Senators John Thune (R-SD) and Ron Wyden (D-Ore) introduced the Charities Helping Americans Regularly Throughout the Year (CHARiTY) Act (S. 2750, summarized here) to “encourage charitable giving and make it easier for foundations and other tax-exempt organizations to conduct their charitable mission.” This legislation, among other things, streamlines operations by changing the private foundation excise tax to a flat one-percent tax, creates a limited exception to the private foundations’ excess business holdings rule, allows the Treasury Department to update the standard mileage rate applicable to personal vehicle use by volunteers (see here for current rate) and, most significantly, expands the IRA charitable rollover to include donations to donor-advised funds. This last measure is viewed as a logical next step that builds upon the Protecting Americans from Tax Hikes Act of 2015 (PATH), which President Obama signed into law last December and was regarded by many as only a partial victory for the charitable sector. While PATH provided certainty for philanthropic planning by making the IRA charitable rollover permanent, as explained here, it did not go as far as extending the reach of the rollover benefit to donor-advised funds.