Many retirees will pleased to know that, as part of the recent tax extenders bill, Congress has permanently allowed the tax free transfer of IRA distributions to qualified charities. For the last few years, taxpayers who are over age 70 ½ were permitted to make up to $100,000 of direct transfers from Individual Retirement Account to qualified charities without having to include the distribution in income.

Without this tax break, taxpayers who wished to make a charitable contribution would have had to include the required minimum distribution from their IRA in income and then claim the charitable contribution deduction as an itemized deduction. The new law provides a double benefit to many taxpayers because it saves on state income taxes and does not require them to itemize in order to benefit on federal taxes.

If you are interested in learning more about nontaxable IRA transfers or any other items included in the extenders bill that may affect your income tax situation, please give us a call.