The tax code last year allowed a taxpayer to donate funds from his or her IRA to a charity. The provision has since expired, and now Congress must decide whether to re-instate this deduction. However, some experts say that Congress does have a habit of re-instating and applying tax code provisions retroactively. Therefore, the person who owns the IRA can still make the donations and the government might re-instate this rule, allowing them to take a deduction. Even if Congress still does not re-instate the tax code provision, the donation would still be treated like a normal gift. In other words, the gift would be treated as income and then taken as an itemized deduction.
See David John Marotta, The IRA Chartiable Donation in 2012, Forbes, May 26, 2012.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
