Pension Protection Act

The Pension Protection Act (PPA) was signed into law by President George W. Bush on August 17, 2006. The PPA was designed to improve pension plan funding requirements of employers, as well as 401(k), IRA, and other retirement plans. The PPA also included numerous provisions that affect charitable giving.

All Council resources are designed to ensure that grantmakers stay in compliance with the law’s requirements. The Council’s summaries of the rules and IRS guidance are based on our continuing analysis. Due to the complexity of the law, limited IRS guidance, and the new issues that the PPA raises, our analysis and recommendations are subject to change, and should not be relied on to avoid any penalties that may be imposed under the Internal Revenue Code. Please check this site and the IRS web site (www.irs.gov) regularly for updates.

Resource Sections:
Almost every section of our resources includes information impacted by the PPA; however, these sections include the information that has been most deeply affected by the PPA:

• Donor-Advised Funds
• Scholarships
• Supporting Organizations
• Grants to and from Private Foundations
• IRA Charitable Rollover
• Reporting Requirements

For additional insight on the PPA, review the technical explanation prepared by the Joint Committee on Taxation. Note: The explanation of charitable giving provisions starts on page 263.

Council on Foundations members may continue to send their legal questions about the PPA’s charitable provisions to legal@cof.org for assistance from Council attorneys.

Disclaimer

The information provided in our resources is based on our continuing analysis of the Pension Protection Act, Internal Revenue Code, and other enacted legislation. Every effort has been made to ensure the accuracy of all information. Due to the complexity of the PPA and the fact that many of these provisions introduce issues that are new to the Internal Revenue Code, this information is subject to change. Please check back here and on the IRS website (www.irs.gov) for updates. This information is not a substitute for expert legal, tax, or other professional advice, and we strongly encourage grantmakers and donors to work with their counsel to determine the impact of the PPA and related guidance on their particular situations. This information may not be relied upon for the purposes of avoiding any penalties that may be imposed under the Internal Revenue Code.