Making Qualified Charitable Donations From an IRA

Taxpayers who are seventy and a half years old or older can make donation directly from their IRAs to IRS approved charities. Unless Congress acts soon, however, this opportunity will expire at the end of this year.

For any one year, the QCD limit is $100,000 for each taxpayer (married couples can donate up to $200,000 jointly.) Though making QCDs from an IRA can be a tax-smart opportunity, making donations from a Roth IRA is generally not. Tax rules for Roth IRAs tend to already be favorable to taxpayers, so making a QDC does not provide any substantial additional tax benefit.

For more information on QCDs, see Bill Bischoff, Making Charitable Donations from Your IRA, Smart Money, Jul. 19, 2011.

Special thanks to Jim Hillhouse (WealthCounsel) for bringing this article to my attention.