Qualified Charitable Distributions From IRAs Have Been Permanently Extended

The Consolidated Appropriations Act, signed into law on December 18, 2015, includes a provision, effective immediately, that permanently extends the ability of individuals at least age 70½ to take qualified charitable distributions (QCDs) from Traditional, Rollover, or Roth IRAs for payment directly to a qualifying charitable organization.

The following restrictions apply to QCDs:

  • A qualifying charitable organization is a public charity as described in IRC 170(b)(1)(A), but does not include donor-advised funds, supporting organizations, or private foundations.
  • Only outright gifts are eligible; contributions to charitable gift annuities, charitable remainder trusts, pooled income funds, or other split-interest entities do not qualify.
  • The amount of the distribution can be excluded from income up to a maximum amount of $100,000 per year.
  • The entire amount must otherwise be includable in income.
  • The entire amount must otherwise be tax deductible as a charitable contribution.
  • The amount of the distribution cannot also be taken as a charitable deduction.
  • The amount distributed to the charity counts toward meeting the required minimum distribution for the year distributed.

For more information about the Consolidated Appropriations Act, 2016, refer to https://www.gpo.gov/fdsys/pkg/BILLS-114hr2029enr/pdf/BILLS-114hr2029enr.pdf

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