by P.J. DiNuzzo February 24, 2017
"Qualified Charitable Distribution" (QCD)
With tax time upon us we would like to send out a reminder to our clients who executed a "Qualified Charitable Distribution" (QCD)
from their IRA for the 2016 tax year. As a quick reminder a QCD is a distribution from your IRA directly to a charity of your choice. This distribution amount will count towards (and satisfy if applicable) your Required Minimum Distribution for the tax year. The QCD will not be counted as taxable income since it went straight to a charity and not distributed to you, the taxpayer.
Please be aware that if you executed a QCD you need to proactively inform your tax preparer of this distribution. On the 1099-R (the tax form that reports all distributions from your IRA), there is no way for tax preparers to determine that you executed a QCD. The taxpayer must tell their preparers that the distributions from their IRA's were sent straight to charities. Otherwise, tax preparers may treat the distribution as fully taxable and we will lose the whole advantage of the QCD.
If you have any questions regarding the QCD's or how to implement this strategy, please contact your lead advisor and see if this strategy is applicable to your situation.
Sincerely,
P.J. DiNuzzo, CPA, PFS®, AEP®, AIF®, MBA, MSTx
President, Founder, and Chief Investment Officer