Tax Reporting for 2014 Qualified Charitable Distributions: What You Need to Know | Ed Slott and Company, LLC

Tax Reporting for 2014 Qualified Charitable Distributions: What You Need to Know

By Beverly DeVeny, IRA Technical Expert
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@BevIRAEdSlott

We still get questions on how a taxpayer should report a QCD (qualified charitable distribution) on their tax return. The IRA custodian does not show the distribution as a QCD on Form 1099-R. It is reported as a normal taxable distribution. Since this provision of the tax code has always been a temporary one, even though it keeps getting renewed by Congress, the IRS Form 1099-R has never been revised for these distributions.

On the IRS Form 1040, the amount on the 1099-R goes on line 15a. On line 15b you put the taxable amount of the distribution. This would be any amounts that the taxpayer kept. It would not include any QCD amounts, which are tax-free. You use the letters QCD on line 15b to tell IRS that the amount not shown as taxable on line 15b is due to the funds directly transferred to charity.

The QCD provision for 2014 was renewed late in the year, but there were no transition rules. If you missed the 12/31/14 deadline, there was no way to do a QCD in 2015 and have it count for 2014.

Currently, there is no QCD provision for 2015. Congress may extend it again, and they may again do it late in the year. There have been proposals in Congress to make the QCD provision permanent. That also may or may not happen. 

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