On Aug. 17, President George W. Bush signed into law the Pension Protection Act of 2006.

It contains an IRA Charitable Rollover Provision. It allows people who are at least 70-1/2 to make a tax-free distribution of up to $100,000 annually from an IRA to charity. 

Provision highlights:

• The provision applies only to transfers made before December 31, 2007. 
• You must be age 70-1/2 or older at the time of the distribution to charity.
• Distribution is limited to a maximum of $100,000 per taxpayer, per year.
• If you are married, you and your spouse can donate up to $200,000 provided each of you owns at least one IRA and you can each make a qualified charitable distribution of $100,000 from your plans.
• Gifts must be outright. The contributions cannot be used to fund gift annuities or charitable remainder unitrusts.
• Gifts cannot be made to donor advised funds and supporting organizations, including most private foundations.
• This opportunity applies only to traditional IRAs and Roth IRAs, not to other forms of retirement plans such as 401(k), 403(b), etc. (Note that making a gift from a Roth IRA is ill advised in most instances, as Roth distributions are typically not taxed.)
• Gifts must be transmitted directly from your IRA’s plan administrator to charity.
• Because no income will be reported on your tax return, you will not receive a charitable income tax deduction for the contribution.

Benefits to you:

• Any qualified charitable distribution that you make will "count" toward your required minimum distribution – the amount you are required by law to withdraw annually beginning at age 70 1/2.
• This is a unique opportunity because it is a tax exclusion, which means you do not have to report the IRA withdrawal as income on your tax return.
• Distributions are not subject to deduction limitation rules that might otherwise reduce the tax benefits.
• In addition, an IRA charitable rollover will not affect your other charitable gifts to which deduction limitations apply.

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