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Protecting Americans From Tax Hikes (PATH) Act of 2015

Protecting Americans From Tax Hikes (PATH) Act of 2015

On December 18th the President signed into law the PATH Act of 2015. This bill provides some much needed certainty by making over twenty tax relief provisions permanent. Those twenty permanent tax relief provisions were culled from 11 different bills and submitted by the ways and means committee as part of the PATH Act for congressional approval. The PATH Act also provides certainty regarding several five-year, two year and other miscellaneous tax provisions.

Permanently Charitable

Some of the biggest permanent changes under the PATH Act are the charitable “extenders.” IRA charitable rollovers are now a permanent exemption thanks to the PATH Act. While the IRA charitable extender has been available for some time, Congress has consistent put the extender in limbo by waiting until the 11th hour to decide whether to extend these tax relief provisions. In fact, the Qualified Charitable Distribution (QCD) rule lapsed at the end of 2014. This made the best charitable intentions difficult to plan for. Fortunately for taxpayers, PATH retroactively extends the tax relief to any IRA charitable rollovers made during the lapsed period.

Explanation of the Charitable Extenders

Charitable distributions from IRAs: allows tax-free distributions by individuals age 70½ or older directly from their IRAs to qualified charities. The annual limit is $100,000 per taxpayer.

For a complete list of the tax relief provisions made permanent under the PATH Act of 2015, visit the ways and means committee website at Path Act 2015.

Contact us to discuss what this means for you.

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