Qualified Charitable Contributions from IRA
Has Congress extended this tax benefit? My client wants to donate directly to a charity from her IRA to satisfy her RMD for 2012.
Has Congress extended this tax benefit? My client wants to donate directly to a charity from her IRA to satisfy her RMD for 2012.
Permalink Submitted by Alan Spross on Mon, 2012-12-03 20:49
Not yet, but still a chance.
If client is going to donate this amount either way, she could do a direct transfer now. If Congress extends the QCD it has always been retroactively to 1/1. And if they don’t the client would have to treat the transfer as a taxable event that would cover her RMD, but then would have to be able to fully itemize the contribution. In other words, it would be handled in the same way as if she received her distribution and then donated from her checking account.
Of course, if client has taken any distributions earlier this year, those would count toward the RMD and eliminate a QCD for that amount even if Congress extends the QCD.
Permalink Submitted by Lorraine DiPaolo on Sun, 2012-12-09 19:45
As an investment advisor,my clients accounts are custodied at JPMorgan Clearing. They will not allow charitable contributions from IRA’s unless ruling is specifically passed. I argued that contributon would then be a ‘distribution’ and taxable but they have refused. Just fyi. Lorraine
Permalink Submitted by Alan Spross on Sun, 2012-12-09 20:31
Thanks for that info.
Hard to say how many firms are taking that approach. For your clients then, they will have to refrain from taking any distributions in RMD years if they want to retain the option of having their QCDs if and when approved apply to their RMD.