I 

109TH CONGRESS 

1ST SESSION H. R. 1607

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

from individual retirement accounts for charitable purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 13, 2005

Mr. HERGER (for himself and Mr. POMEROY) 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 allow taxfree distributions from individual retirement accounts 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 ‘‘Public Good IRA Roll5 over Act’’. 

6 SEC. 2. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RE7 TIREMENT ACCOUNTS FOR CHARITABLE 

8 PURPOSES. 

9 (a) IN GENERAL.—Subsection (d) of section 408 of 

10 the Internal Revenue Code of 1986 (relating to individual 
2

•HR 1607 IH 

1 retirement accounts) is amended by adding at the end the 

2 following new paragraph: 

3 ‘‘(8) DISTRIBUTIONS FOR CHARITABLE PUR4 POSES.—

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

6 includible in gross income by reason of a quali7 fied charitable distribution. 

8 ‘‘(B) QUALIFIED CHARITABLE DISTRIBU9 TION.—For purposes of this paragraph, the 

10 term ‘qualified charitable distribution’ means 

11 any distribution from an individual retirement 

12 account—

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

14 trustee—

15 ‘‘(I) to an organization described 

16 in section 170(c), or 

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

18 and 

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

20 date that the individual for whose benefit 

21 the account is maintained has attained—

22 ‘‘(I) in the case of any distribu23 tion described in clause (i)(I), age 

701 24 ⁄2, and 
3

•HR 1607 IH 

1 ‘‘(II) in the case of any distribu2 tion described in clause (i)(II), age 

591 3 ⁄2. 

4 A distribution shall be treated as a qualified 

5 charitable distribution only to the extent that 

6 the distribution would be includible in gross in7 come without regard to subparagraph (A) and, 

8 in the case of a distribution to a split-interest 

9 entity, only if no person holds an income inter10 est in the amounts in the split-interest entity 

11 attributable to such distribution other than one 

12 or more of the following: the individual for 

13 whose benefit such account is maintained, the 

14 spouse of such individual, or any organization 

15 described in section 170(c). 

16 ‘‘(C) CONTRIBUTIONS MUST BE OTHER17 WISE DEDUCTIBLE.—For purposes of this para18 graph—

19 ‘‘(i) DIRECT CONTRIBUTIONS.—A dis20 tribution to an organization described in 

21 section 170(c) shall be treated as a quali22 fied charitable distribution only if a deduc23 tion for the entire distribution would be al24 lowable under section 170 (determined 
4

•HR 1607 IH 

1 without regard to subsection (b) thereof 

2 and this paragraph). 

3 ‘‘(ii) SPLIT-INTEREST GIFTS.—A dis4 tribution to a split-interest entity shall be 

5 treated as a qualified charitable distribu6 tion only if a deduction for the entire value 

7 of the interest in the distribution for the 

8 use of an organization described in section 

9 170(c) would be allowable under section 

10 170 (determined without regard to sub11 section (b) thereof and this paragraph). 

12 ‘‘(D) APPLICATION OF SECTION 72.—Not13 withstanding section 72, in determining the ex14 tent to which a distribution is a qualified chari15 table distribution, the entire amount of the dis16 tribution shall be treated as includible in gross 

17 income without regard to subparagraph (A) to 

18 the extent that such amount does not exceed 

19 the aggregate amount which would be so includ20 ible if all amounts were distributed from all in21 dividual retirement accounts otherwise taken 

22 into account in determining the inclusion on 

23 such distribution under section 72. Proper ad24 justments shall be made in applying section 72 
5

•HR 1607 IH 

1 to other distributions in such taxable year and 

2 subsequent taxable years. 

3 ‘‘(E) SPECIAL RULES FOR SPLIT-INTEREST

4 ENTITIES.—

5 ‘‘(i) CHARITABLE REMAINDER

6 TRUSTS.—Notwithstanding section 664(b), 

7 distributions made from a trust described 

8 in subparagraph (G)(i) shall be treated as 

9 ordinary income in the hands of the bene10 ficiary to whom is paid the annuity de11 scribed in section 664(d)(1)(A) or the pay12 ment described in section 664(d)(2)(A). 

13 ‘‘(ii) POOLED INCOME FUNDS.—No 

14 amount shall be includible in the gross in15 come of a pooled income fund (as defined 

16 in subparagraph (G)(ii)) by reason of a 

17 qualified charitable distribution to such 

18 fund, and all distributions from the fund 

19 which are attributable to qualified chari20 table distributions shall be treated as ordi21 nary income to the beneficiary. 

22 ‘‘(iii) CHARITABLE GIFT ANNU23 ITIES.—Qualified charitable distributions 

24 made for a charitable gift annuity shall not 
6

•HR 1607 IH 

1 be treated as an investment in the con2 tract. 

3 ‘‘(F) DENIAL OF DEDUCTION.—Qualified 

4 charitable distributions shall not be taken into 

5 account in determining the deduction under sec6 tion 170. 

7 ‘‘(G) SPLIT-INTEREST ENTITY DEFINED.—

8 For purposes of this paragraph, the term ‘split9 interest entity’ means—

10 ‘‘(i) a charitable remainder annuity 

11 trust or a charitable remainder unitrust 

12 (as such terms are defined in section 

13 664(d)) which must be funded exclusively 

14 by qualified charitable distributions, 

15 ‘‘(ii) a pooled income fund (as defined 

16 in section 642(c)(5)), but only if the fund 

17 accounts separately for amounts attrib18 utable to qualified charitable distributions, 

19 and 

20 ‘‘(iii) a charitable gift annuity (as de21 fined in section 501(m)(5)).’’. 

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

23 this section shall apply to taxable years beginning after 

24 December 31, 2004.

Æ