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1099-R IRA Distributions transferred to Qualified Charity

SOLVEDby IntuitProConnect Tax11Updated July 27, 2021

The Pension Protection Act of 2006 provides that an individual who has attained the age of 70 & 1/2 can instruct an IRA plan trustee to make a transfer of IRA distributions to a Code Section 170(b )(1)(A) charitable organization, and exclude up to $100,000 of such distributions from income, instead of claiming the contributions as an itemized deduction subject to AGI limitations.

To enter in the program:

  1. Go to the Input Return tab.
  2. On the left navigation menu, select Income > Pensions, IRAs (1099-R).
  3. Enter the Payer, Gross Distribution, and Taxable Amount as normal.
  4. Click the Details button to view more input options.
  5. Scroll down to the Other Information section.
  6. Locate the Charitable IRA Distributions subsection.
  7. Enter the amount in IRA distributions transferred to qualified charity.

In addition to reducing IRA income by the amounts that were transferred to qualified charities, in some cases a residual amount may automatically carry to the Schedule A as an itemized deduction.

For example, if the taxpayer has $20,000 in basis in traditional IRAs, and an IRA worth $30,000 in which the taxpayer had the entire amount transferred to a qualified charity, the program will reduce income by $10,000 (the otherwise taxable amount), and deduct the residual $20,000 amount on Schedule A.

If you would like to suppress the program's automatic deduction of the residual amount on Schedule A, check the box Suppress Itemized Deduction of Amounts That Do Not Reduce AGI on the Pensions screen.

Indiana, Hawaii, Kentucky, New Jersey, and Wisconsin do not conform to the provision that allows a reduction of AGI by the amount of a charitable distribution. Therefore, addition adjustments are made automatically for these state returns. Additionally, amounts that are added back to state income, are included as a state only itemized deduction for these states.

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