This past week the US House of Representatives passed a bill (HR 4719, known as the America Gives More Act) which would re-instate the Qualified Charitable Distribution from IRAs and make the provision permanent. This provision expired at the end of 2013, as it has multiple times in the past, only to be re-instated temporarily time and again.
A Qualified Charitable Distribution (QCD) is when a person who is at least age 70½ years of age and subject to Required Minimum Distributions from an IRA is allowed to make a distribution from the IRA and direct the distribution to a qualified charitable organization without having to recognize the income for taxable purposes. This has been a popular option for many taxpayers, especially since the QCD can also be recognized as the Required Minimum Distribution for the year from the IRA.
We’ve discussed the Qualified Charitable Distribution many times in the past, primarily when it was expiring or being reinstated. What’s different about this most recent legislation is that the provision is to be extended permanently. The projected cost in lost revenue of the QCD portion of the pending legislation over the coming decade is nearly $8.5 billion. Initial reports indicate that the White House is opposed to the legislation as written, in part because there is no off-setting revenue stream for the lost revenue.
The Senate is reviewing another proposal to extend this provision temporarily (once again). So, while this looks like a promising bit of legislation, there’s no expectation that it is a done deal – we’ll keep you posted here as the story evolves.