Qualified Charitable Deductions, Part 3

QCDs are a direct donation to an established charity from an IRA without impacting Adjusted Gross Income. It does count toward Required Minimum Distibution.
It appears they may be renewed: http://www.kiplinger.com/columns/ask/archive/do-not-transfer-ira-distributions-to-charity-yet.html
Parts 1 & 2 were discussed last November.
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On 3/14/12 9:56 AM, FranksPlace2 wrote:

impacting Adjusted Gross Income. It does count toward Required Minimum Distribution.

http://www.kiplinger.com/columns/ask/archive/do-not-transfer-ira-distributions-to-charity-yet.html
Nice article. If I recall, last year Congress approved the QCD very late in the year. Maybe it's not a priority, of course, but for those impacted, it's an important thing to know, sooner than later. For retirees whose generosity is large, but don't break trough the standard deduction, this was a great perk. http://www.joetaxpayer.com/donating-your-ira-rmd /
Joe
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For retirees who have to pay Medicare premiums, the fact that QCDs do not increase AGI can also be helpful. Taking $X in in cash (thereby increasing AGI) from an IRA, making a charitable donation of $X and deducting $X on Schedule A is not as good as having $X sent directly to the charity as a QCD, no increase in AGI, and no deduction on Schedue A, especially if the increased AGI causes an increase in Medicare premiums. And yes, I do know that Medicare premiums are determined by MAGI (which also increases when AGI increases) and not by AGI. A similar calculation to taxability of Social Security benefits also.
Dilip Sarwate
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On 3/15/12 8:53 PM, dvsarwate wrote:

A reader commented that on my site. Excellent to bring it up here. The QCD is a great perk, I hope they continue it.
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