Insights
Publications

Charitable Giving: Better Late than Never

1/22/2013 Articles

The American Taxpayer Relief Act of 2012 (the “Act”), signed into law by President Obama on January 2, 2013, extends favorable tax treatment for qualified charitable distributions made from IRAs (”Individual Retirement Accounts”).

The Act extends, for 2012 and 2013, the tax-free treatment of IRA distributions of up to $100,000 where the distributions are donated to a qualified charitable organization and the IRA beneficiary is at least 70 ½ years old at the time of the distribution. For purposes of this tax provision, a qualified charitable organization is a public charity. Distributions to private foundations, donor advised funds, and supporting organizations are specifically excluded.

While qualified charitable distributions typically need to be made directly from an IRA to a qualified charitable organization for the income exclusion to apply, the Act permits individuals to elect to treat cash distributions received in December 2012 by an IRA beneficiary as qualified charitable distributions as long as the funds are donated to a qualified charitable organization before February 1, 2013.

The Act also permits a taxpayer to elect to have qualified charitable distributions made in January 2013 treated as made in 2012, thereby allowing such distributions to satisfy an individual’s 2012 required minimum distribution (up to $100,000). However, in order for the election to be made, the distribution must be made directly from an IRA to a qualified charity.  This election can be the saving grace for individuals who neglected to take a required minimum distribution in 2012 and would otherwise be subject to a penalty of 50%.

If you have questions or are interested in making either of the elections, please contact your Farella Braun + Martel attorney, Barbara Murphy or Evan Abrams quickly, as action needs to be taken no later than January 30, 2013.

Firm Highlights

News

More Americans Are Renouncing Their Citizenship

In the article, "More Americans Are Renouncing Their Citizenship," originally published in The Wall Street Journal , Erin Fraser discusses tax and estate planning issues related to renouncing U.S. citizenship. Link to the full article .

Read More
News

Farella Braun + Martel Ranked Among “Best Law Firms” by U.S. News & World Report and Best Lawyers

SAN FRANCISCO, November 5, 2020: Farella Braun + Martel earned national and regional rankings across a number of practice areas in the U.S. News & World Report and Best Lawyers® release of the “Best...

Read More
Publication

Estate Planning During Uncertain Times

Farella's Wine Industry Education Series features Lauren Galbraith discussing "Estate Planning During Uncertain Times." Estate planning for vineyard and winery owners has come to the forefront during this unpredictable pandemic and in light of...

Read More
Publication

Year-End Estate Planning in an Election Year

The 2020 election is less than a month away and year-end estate planning is already underway for many. Under current law, the estate, gift and GST (generation-skipping transfer) tax exemptions for 2020 are set at...

Read More
News

Eight Farella Braun + Martel Lawyers Listed in Best Lawyers: Ones to Watch 2021

SAN FRANCISCO/ST. HELENA, CA, August 20, 2020: Eight Farella Braun + Martel lawyers were listed in the inaugural Best Lawyers: Ones to Watch . This recognition is awarded to attorneys who are earlier in...

Read More
Publication

Wealth Transfer Strategies in Today’s Market

Current market conditions and the federal gift and estate tax laws present wealth transfer opportunities that high net worth individuals may wish to leverage over the near term. Federal Gift and Estate Tax Exemption...

Read More
Publication

Estate Tax Planning for Large Company Stock Holdings: Four Tips for Using Record-High Lifetime Exemptions

Published on MyStockOptions.com . Key Points Annual inflation-indexing continues to increase the historically high lifetime exemption amount for gift, estate, and generation-skipping transfer taxes. Those of considerable wealth who have not yet made gifts...

Read More
News

Year-End Planning After The Election: What Financial Advisors & Tax Pros Are Telling Clients About Future Tax Changes

Lauren Galbraith was quoted in the Forbes article "Year-End Planning After The Election: What Financial Advisors & Tax Pros Are Telling Clients About Future Tax Changes." Read the full article, here .

Read More
Publication

Four Tips for High Net Worth Individuals Desiring to Utilize Record-High Lifetime Exemptions

The historically high lifetime exemption amount for gift, estate and generation-skipping transfer taxes increased from $11,400,000 to $11,580,000 per person this year due to inflation indexing. Individuals who had used up their lifetime exemption...

Read More
News

52 Farella Braun + Martel Attorneys Listed in The Best Lawyers in America© 2021

Read More