I 

114TH CONGRESS 

2D SESSION H. R. 5171 

To amend the Internal Revenue Code of 1986 to expand tax-free distributions 

from individual retirement accounts to include rollovers for charitable 

life-income plans for charitable purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 6, 2016 

Mr. ROSKAM (for himself, Mr. BLUMENAUER, Mr. CRAMER, Mr. TIBERI, and 

Mr. PAULSEN) introduced the following bill; which was referred to the 

Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to expand 

tax-free distributions from individual retirement accounts 

to include rollovers for charitable life-income plans for 

charitable purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Legacy IRA Act’’. 


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1 SEC. 2. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RE2 TIREMENT ACCOUNTS FOR CHARITABLE 

3 PURPOSES. 

4 (a) IN GENERAL.—Paragraph (8) of section 408(d) 

5 of the Internal Revenue Code of 1986 (relating to tax 

6 treatment of distributions) is amended to read as follows: 

7 ‘‘(8) DISTRIBUTIONS FOR CHARITABLE PUR8 POSES.— 

9 ‘‘(A) IN GENERAL.—No amount shall be 

10 includible in gross income by reason of a quali11 fied charitable distribution. 

12 ‘‘(B) LIMITATIONS.— 

13 ‘‘(i) IN GENERAL.—The aggregate 

14 amount excluded from gross income by 

15 subparagraph (A) for a taxable year shall 

16 not exceed $400,000. 

17 ‘‘(ii) ORGANIZATION AND ENTITY SPE18 CIFIC LIMITATIONS.—The amount excluded 

19 from gross income by subparagraph (A) 

20 for a taxable year shall not exceed— 

21 ‘‘(I) $100,000, in the case of any 

22 distribution described in subparagraph 

23 (C)(i)(I), and 

24 ‘‘(II) $400,000, in the case of 

25 any distribution described in subpara26 graph (C)(i)(II). 


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1 ‘‘(C) QUALIFIED CHARITABLE DISTRIBU2 TION.—For purposes of this paragraph, the 

3 term ‘qualified charitable distribution’ means 

4 any distribution from an individual retirement 

5 account— 

6 ‘‘(i) which is made directly by the 

7 trustee— 

8 ‘‘(I) to a specified charitable or9 ganization, or 

10 ‘‘(II) to a split-interest entity, 

11 and 

12 ‘‘(ii) which is made on or after the 

13 date that the individual for whose benefit 

14 the account is maintained has attained— 

15 ‘‘(I) in the case of any distribu16 tion described in clause (i)(I), age 

701 17 ⁄2, and 

18 ‘‘(II) in the case of any distribu19 tion described in clause (i)(II), age 

20 65. 

21 ‘‘(D) SPECIAL RULES RELATING TO DIS22 TRIBUTIONS.—For purposes of this para23 graph— 

24 ‘‘(i) DISTRIBUTION MUST BE OTHER25 WISE INCLUDIBLE.—A distribution from 


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1 an individual retirement account shall be 

2 treated as a qualified charitable distribu3 tion only to the extent that the distribution 

4 would be includible in gross income with5 out regard to subparagraph (A). 

6 ‘‘(ii) LIMITATION ON INCOME INTER7 ESTS.—A distribution from an individual 

8 retirement account to a split-interest entity 

9 may only be treated as a qualified chari10 table distribution if— 

11 ‘‘(I) no person holds an income 

12 interest in the split-interest entity 

13 other than the individual for whose 

14 benefit such account is maintained, 

15 the spouse of such individual, or both, 

16 and 

17 ‘‘(II) the income interest in the 

18 split-interest entity is nonassignable. 

19 ‘‘(iii) CONTRIBUTIONS MUST BE OTH20 ERWISE DEDUCTIBLE.—A distribution 

21 from an individual retirement account to a 

22 specified charitable organization may be 

23 treated as a qualified charitable distribu24 tion only if— 


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1 ‘‘(I) in the case of a distribution 

2 to a charitable remainder annuity 

3 trust or a charitable remainder 

4 unitrust, a deduction for the entire 

5 value of the remainder interest in the 

6 distribution for the benefit of a speci7 fied charitable organization would be 

8 allowable under section 170 (deter9 mined without regard to subsection 

10 (b) thereof and this paragraph), and 

11 ‘‘(II) in the case of a charitable 

12 gift annuity, a deduction in an 

13 amount equal to the amount of the 

14 distribution reduced by the value of 

15 the annuity described in section 

16 501(m)(5)(B) would be allowable 

17 under section 170 (determined with18 out regard to subsection (b) thereof 

19 and this paragraph). 

20 ‘‘(E) SPECIFIED CHARITABLE ORGANIZA21 TION DEFINED.—For purposes of this para22 graph, the term ‘specified charitable organiza23 tion’ means an organization described in section 

24 170(b)(1)(A) (other than any organization deVerDate Sep 11 2014 06:45 May 11, 2016 Jkt 059200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5171.IH H5171

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1 scribed in section 509(a)(3) or any fund or ac2 count described in section 4966(d)(2)). 

3 ‘‘(F) SPLIT-INTEREST ENTITY DEFINED.— 

4 For purposes of this paragraph, the term ‘split5 interest entity’ means— 

6 ‘‘(i) a charitable remainder annuity 

7 trust (as defined in section 664(d)(1)), but 

8 only if such trust is funded exclusively by 

9 a qualified charitable distribution, 

10 ‘‘(ii) a charitable remainder unitrust 

11 (as defined in section 664(d)(2)), but only 

12 if such unitrust is funded exclusively by 

13 one or more qualified charitable distribu14 tions, or 

15 ‘‘(iii) a charitable gift annuity (as de16 fined in section 501(m)(5)), but only if 

17 such annuity is funded exclusively by a 

18 qualified charitable distribution and com19 mences fixed payments of 5 percent or 

20 greater not later than one year from date 

21 of funding. 

22 ‘‘(G) SPECIAL RULES.— 

23 ‘‘(i) CHARITABLE REMAINDER

24 TRUSTS.—Notwithstanding section 664(b), 

25 distributions made from a trust described 


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1 in clause (i) or (ii) of subparagraph (F) 

2 shall be treated as ordinary income in the 

3 hands of the beneficiary to whom is paid 

4 the annuity described in section 

5 664(d)(1)(A) or the payment described in 

6 section 664(d)(2)(A). 

7 ‘‘(ii) CHARITABLE GIFT ANNUITIES.— 

8 Qualified charitable distributions made for 

9 a charitable gift annuity shall not be treat10 ed as an investment in the contract for 

11 purposes of section 72(c). 

12 ‘‘(iii) APPLICATION OF SECTION 72.— 

13 Notwithstanding section 72, in determining 

14 the extent to which a distribution is a 

15 qualified charitable distribution, the entire 

16 amount of the distribution shall be treated 

17 as includible in gross income without re18 gard to subparagraph (A) to the extent 

19 that such amount does not exceed the ag20 gregate amount which would have been so 

21 includible if all amounts in all individual 

22 retirement plans of the individual were dis23 tributed during the taxable year and all 

24 such plans were treated as 1 contract for 

25 purposes of determining under section 72 


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1 the aggregate amount which would have 

2 been so includible. Proper adjustments 

3 shall be made in applying section 72 to 

4 other distributions in such taxable year 

5 and subsequent taxable years. 

6 ‘‘(iv) DETERMINING DEDUCTION

7 UNDER SECTION 170.—Qualified charitable 

8 distributions shall not be taken into ac9 count in determining the deduction under 

10 section 170. 

11 ‘‘(v) REQUIRED MINIMUM DISTRIBU12 TIONS.—The entire amount of a qualified 

13 charitable distribution shall be taken into 

14 account for purposes of section 401(a)(9). 

15 ‘‘(H) TERMINATION WITH RESPECT TO

16 SPLIT-ENTITIES.—Subparagraph (A) shall not 

17 apply to a distribution to a split-interest entity 

18 after December 31, 2020.’’. 

19 (b) EFFECTIVE DATE.—The amendment made by 

20 this section shall apply to distributions made in taxable 

21 years ending after the date of the enactment of this Act. 

Æ 


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