If you took a distribution from your IRA in December 2012 you may be able to reduce your 2012 tax liability and support the LGBT community. But Congress has made this opportunity available only if you act quickly!

Transgender Law Center wants to be sure that you are aware of an opportunity made possible by the Americans Tax Payers Relief Act of 2012, passed just two weeks ago.

Donors who are 70 ½ or older and who made a charitable contribution directly from an IRA in 2012 may take the distribution tax free and claim the charitable deduction. In addition, donors who personally received the Required Minimum Distribution (RMD) in December may be able to make a contribution to charity before January 31, 2013 and treat the prior distribution as a tax-free distribution from your IRA. Donors may also make an additional contribution directly to charity from an IRA during the month of January and claim it as tax free income for 2012. Many donors did not give the full amount that they may have otherwise as the status of the law was uncertain during the year. With these clarifications, donors may wish to make additional contributions and may be able to allocate such distributions as having been made in 2012 and may certainly do so for 2013, up to $100,000 for each tax year.

The recent clarification of the tax-free distribution to charities from IRA’s for those over 70 ½ has now been made permanent. It’s a very powerful way to leverage charitable giving. This is of particular importance to the LGBT community as there is no spousal rollover provision as there is for federally recognized married couples.

Donors who are 70 ½ or older and who made a charitable contribution directly from an IRA in 2012 may take the distribution tax free and claim the charitable deduction. In addition, donors who personally received the Required Minimum Distribution (RMD) in December may be able to make a contribution to charity before January 31, 2013 and treat the prior distribution as a tax-free distribution from your IRA. Donors may also make an additional contribution directly to charity from an IRA during the month of January and claim it as tax free income for 2012. Many donors did not give the full amount that they may have otherwise as the status of the law was uncertain during the year. With these clarifications, donors may wish to make additional contributions and may be able to allocate such distributions as having been made in 2012 and may certainly do so for 2013, up to $100,000 for each tax year.

You only have until January 31st to complete the necessary paperwork, so time is of the essence.

– Deb Kinney, of DLK Law Group

There is much more information available (and this shouldn’t be considered tax advice in any way), so if you are interested, please contact your tax professional or consult Horizons Foundation’s Directory of Professional Advisors.

Transgender Law Center extends sincere gratitude to Horizons Foundation and Deb Kinney, DLK Law Group for making this information available to our community.

http://www.horizonsfoundation.org/pdf/2012PADirectoryWEB.pdf