Donating RMD to a qualified charity

[katieinny]

It seems that the tax free donation of RMDs from IRAs to qualified charities has been extended a couple of times, but I'm not sure that it's safe to say that it's a fixture. It is discussed in the 2013 version of Pub. 590. I don't see reference to there being a deadline in that publication, but before I pass on any information to a client about doing it for 2014, does anybody have a definitive answer as to whether it's available this year, and for the foreseeable future?

[My 2 cents]

How would taxable receipt of the RMD and subsequent donation of the same amount to a qualified charity differ in net result from the tax free donation of RMDs to which you refer? Probably clear from this question that I am not a tax expert!

[K2retire]

Receipt would increase the adjusted gross income. That could impact how much of Social Security benefits is taxable and also the thresholds for several itemized deductions.

[Bird]

Not extended for 2014. I saw something that said a house panel had approved a proposal to make it a permanent thing. Not sure how likely that is.

[ESOP Guy]

This one of those bizarre rules that gets extended retro back to 1/1 every late Dec. Thus, either leaving you no time to do it or doing and risk they don't get around to extending the law for another year.

[katieinny]

Thanks Bird and ESOP. Ya gotta love the IRS.

[My 2 cents]

Thanks Bird and ESOP. Ya gotta love the IRS.

It's not the IRS that extends it every year, is it? Isn't it Congress? Wouldn't that make it (excuse the expression) "Ya gotta love Congress"?

[Borsley]

Thanks Bird and ESOP. Ya gotta love the IRS.

Only congress, not the IRS, has the authority to extend the Qualified Charitable Distribution exemption.

[katieinny]

I do apologize for my inaccurate statement. Frankly, I don't love Congress -- at all. I happened to be reading an article in the newspaper this past weekend about how the IRS gets blamed for Congress's transgressions. Since I pretty much hate Congress these days, I certainly want to place blame where it's due.

[Borsley]

I read recently that some believe that passage of a PERMANENT QCD deduction in 2014 is still a possibility. Speculation that this might be only thing passed by the lame duck congress. Stay tuned...

[mbozek]

Update:

the QCD deduction is one of 55 tax extenders that expired at the end of 2013. Senate passed its version of the extenders earlier this year. House has not voted. Everyone believes that Congress will pass the extenders for 2014 and 2015 because there are too many important tax provisions which everyone deems necessary such as accelerated depreciation and the exemption of debt forgiveness on cancelled mortgage obligations from taxable income. It will probably be up to the Next congress to act. Cost is estimated at least 30B a year.