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

Farella Braun + Martel Recognized in 2020 Chambers High Net Worth Guide for Private Wealth Law in Northern California

SAN FRANCISCO, July 10, 2020: Farella Braun + Martel’s Private Client Industry Group earned recognition in the 2020 Chambers High Net Worth (HNW) guide as a leading firm in the Private Wealth Law category...

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

Hot Topics Facing Nonprofit Organizations and Their Advisors in 2020

Farella's Nonprofit Education Series features Cynthia Rowland and Matt Lewis discussing current issues nonprofit organizations and their advisors are facing this year. Cynthia and Matt cover: About that nest egg—when nonprofits can, and can’t, access “endowment&rdquo...

Read More
News

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

Read More
Event

Estate Planning During Uncertain Times

Join Lauren Galbraith in the discussion on "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 the upcoming...

Read More
Publication

Your Retirement Planning and the SECURE Act

The Setting Every Community Up for Retirement Enhancement Act (or SECURE Act), signed into law on December 20, 2019, changes retirement planning significantly and unexpectedly. The bulk of the changes become effective as of January...

Read More
Publication

End of a Decade - Checklist for California Nonprofits

As 2019 comes to a close, we thought about our customary note to nonprofit officers and directors to take a few moments to confirm that important year-end responsibilities have not been overlooked. But since this...

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

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
Publication

Employment Law Updates for Nonprofits in the New Normal

Farella's Nonprofit Education Series features Rebecca Stephens and Jaya Bajaj discussing "Employment Law Updates for Nonprofits in the New Normal." Nonprofit organizations are subject to both state and federal employment laws and regulations. The...

Read More