Charitable Donation from IRA
Earlier this year I withdrew all my year 2010 RMD except for $5000. This “hold back” was in case Congress authorized “direct,” pre-tax charitable donations. (This is my own IRA, not inherited). My plan is to authorize the $5000 “direct” donation from the IRA on Monday. So my question is: under the bill signed today does this donation qualify as a tax free withdrawal? Thanks
Permalink Submitted by Alan Spross on Sat, 2010-12-18 00:30
Yes, you would report the 5k as a QCD on your return. It would satisfy the rest of your RMD and not be taxable. Of course, the RMD you already took out will be taxable.
Note: Same thing if you were referring to an inherited IRA. Inherited IRAs are eligible for QCD transfers as well, but you also must be at least 70.5.
The QCD has also been extended to the end of 2011, but not beyond. At least you do not have to wait for Congress for your 2011 QCD.
Permalink Submitted by Lorraine DiPaolo on Mon, 2010-12-20 12:49
Since I already took my RMD for 2010, could I not reverse it as I would want to use the entire $100,000 as a charitable contribution?