This bill amends New Jersey's gross income tax law to provide an exclusion for distributions made from individual retirement accounts (IRAs) to qualified charitable organizations. Specifically, it allows for tax-free distributions from both Roth IRAs and traditional IRAs when the funds are donated to organizations recognized as tax-exempt under section 501(c)(3) of the federal Internal Revenue Code. The bill defines a "qualified charitable organization" and outlines the conditions under which distributions from these retirement accounts can be made without incurring state income tax.

The bill also updates the definitions related to Roth IRAs and traditional IRAs, clarifying that a traditional IRA is one that is not a Roth IRA. It specifies that qualified distributions from a Roth IRA include those made to a qualified charitable organization, in addition to other existing conditions such as age, disability, or death of the account holder. The act is set to take effect immediately and will apply to taxable years beginning on or after January 1 of the year following its enactment.

Statutes affected:
Introduced: 54A:6-28