Qualified Charitable Distribution – A Permanent Rule
Since 2006, IRA owners who are at least 70½ years old could make a Qualified Charitable Distribution (QCD) of up to $100,000 directly from an IRA to a charity without having to include the distribution in taxable income. For the past 5 years, Congress has waited until the very end of the tax year to retroactively extend this provision. New legislation now makes the QCD rules permanent (12/18/15).
Take Advantage of QCD Starting at 70 ½
The contribution to the charity is not claimed as a tax deduction, but the distribution from the IRA is not taxed in income either, making it a pre-tax charitable contribution. And the QCD counts towards the taxpayer’s Required Minimum Distribution (RMD) obligations, which would apply given that he/she must already be over the age of 70 ½.
A spouse age 70½ with an IRA could give up to $100,000 as well. The funds, which cannot come from active SEP or SIMPLE IRAs, must be sent directly to the qualified (IRS-approved) charitable organization.
BPAS clients are encouraged to call and speak with a member of the IRA Team to learn more. Please call: 315.292.6900 ext. 3150.