Nov 21
In 2006 and 2007, there was a tax law allowing someone over 70-1/2 to make a donation from their IRA, even if this was part of their RMD. This had a very narrow audience of interest, one would have to find herself a combination of 70-1/2 or older, therefore taking IRA RMDs, making donations worth the effort to do the extra paperwork, and not an itemizer. The benefit for this situation is that the donor is making the donation directly from IRA to charity, and therefore avoids the tax due on that portion of her distribution.
Given the limited discussion of this topic, I expected it to expire as 2007 closed, and not get revisited. I was mistaken, the Emergency Economic Stabilization Act of 2008 renewed this law for both 2008 and 2009.
Joe
written by JOE
\\ tags: charity, donation, economic stabilization act, IRA, RMD, tax
Aug 11
Regular readers know how I feel about variable annuities, but have little issue with the immediate annuity. Now, one issue that would hit us if you wished to put an immediate annuity inside an IRA is the calculation of RMDs and taking RMDs that may exceed the cash available within the IRA.
IRS Regulation section 1.401 (a) (9)-6 offers a solution.
If an immediate annuity is qualified and based on a payout scheme that is not intended to exceed your life expectancy the annual payout satisfies the RMD requirement even if it is less than would otherwise
be required. Perhaps a bit of an obscure issue, but one you may run into at retirement.
Joe
written by JOE
\\ tags: annuity, immediate annuity, IRA, irs, irs regulation, Retirement, RMD, variable annuities
