Yet Another Part of the Tax Law That Leaves us Hanging | Tax Tip of the Week | No. 161

IRAs and Charitable DistributionsI recently fielded a question from one of our clients that I felt would be of interest to many of our readers.He wanted to know whether he could still make a contribution from his IRA directly to his church and not have it be included in his taxable income for 2012.He is referring to the Qualified Charitable Distribution (QCD) provision of the tax law that allows a tax-free distribution directly to a charity, up to $100,000, from your IRA if you are 70 ½ or older. This distribution also counts towards your Required Minimum Distribution (RMD).While you do not get a charitable deduction for this type of distribution, it is a great way for seniors to get tax-free treatment on their RMDs.This provision in the tax law expired at the end of 2011. Therefore, the answer to his question right now is “NO.”However, on August 2, 2012, the Senate Finance Committee approved the Family and Business Tax Cut Certainty Act of 2012. This bill includes, as one of its provisions, an extension of the QCD for 2 years.If, and when, Congress approves this bill, and the President signs it into law, I will let you know.As always, give us a call with any questions you may have.You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.Rick Prewitt - the guy behind TTWTax Tip of the Week Video Series:http://youtu.be/BlhqUiVEsJo...until next week.