Dana Carlson Gentry, Esq., Board Certified in Wills, Trusts & Estates
The American Taxpayer Relief Act passed on January 1, 2013, extended through the end of 2013 the provision allowing you to make a charitable contribution up to $100,000 to a qualified public charity from your IRA if you are over 70 1/2 years of age and are taking Required Minimum Distributions. This charitable contribution must be taken before December 31, 2013.
You may choose more than one public charity for lesser amounts, as long as the total amount does not exceed $100,000 for each year. The charities selected must be qualified public charitable organizations, as described under the IRS statutes and rules. You may not use any Donor Advised Fund or a Gift Annuity; however, you may use a Designated Fund from a qualified Community Foundation.
Although you cannot take an itemized charitable deduction on your 2013 income tax return, the full amount you contribute to a qualified charity (of an otherwise taxable IRA distribution) will not be taxable income for 2013. This effective reduction in taxable income will be more beneficial than a charitable deduction for most taxpayers, including those in the highest income tax brackets, who do not need the sums from their Required Minimum Distributions for their current living expenses.
If you have questions about this benefit under the American Taxpayer Relief Act or any of the Act’s other provisions and how they may impact you personally, please call our office to schedule an appointment with any lawyer in our estate planning group. We will be happy to assist you.
