Timing of QCD’s within the year
Hello Ed Slott Team If my client is elegible for QCDs , is there any required timing during the year between the RMD recieved and the QCD issued to be a part of the RMD for the year? By timing, does one need to occur before the other? Thank you Patrick Lanza
Permalink Submitted by Alan - IRA critic on Tue, 2024-05-14 16:07
There is no required order, but in order to apply all QCDs to the RMD, all QCDs must be completed before or at the same time as the entire RMD for all IRA accounts. Should the RMD be completed and a month later the client wants to do another QCD, that QCD will not be taxable, but neither will it reduce the taxation of the RMDs already distributed.
It’s not a problem to take a partial RMD prior to any QCDs and then distribute the QCD later as long as the total RMD had yet been distributed.
Of course, these timing considerations arise from the rule that the first distributions done in a year are deemed to apply to the RMD until the RMD has been completed, and in the case of multiple IRA accounts are treated as one combined IRA.
Permalink Submitted by Patrick Lanza on Tue, 2024-05-14 16:14
Thank you very much