QCD’s
Hello Alan: CPA said QCD could not be more than RMD. I referred him to pub 590-b and he still insists he’s right (scary). My understanding–QCD cannot be more than $100,000. The amount is limited to that which must reported as income. The QCD can be either more or less than RMD. The QCD is counted towards RMD and must be designated as such before any distribution is made to me.
Please verify, or correct, statements. I am not aware of any tax law changes.
Thanks,
MBD
Permalink Submitted by Alan - IRA critic on Fri, 2017-03-03 19:23
CPA is incorrect. You are correct about everything except the final sentence, which is true only for QCDs that are large or even more than the RMD. For example, of your RMD was 50k and you wanted to make a 5k QCD, you could take out up to 45k for yourself before doing the QCD and the QCD would still offset 5k of your RMD. It is generally safer to just do the QCD first though and that eliminates some of the math.