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