Individual over age 70.5 already took RMDs for 2015 in November and wants to somehow now send that RMD to charity under the IRA giving law? Any way to undo the RMD withdrawal and then have it go to charity?
Answer: sorry, no.
There is a 60 day rule for individuals (any age) to withdraw IRA funds and then return them to an IRA account with no tax consequences or penalties. Why can’t our donor just return the RMD funds he took out in November and then request an IRA rollover gift to satisfy his RMDs?
Sadly, there is another rule regarding RMDs that prevents this from working. The rule is that until RMDs are satisfied, any withdrawal from your IRA is considered RMD and you can’t use the 60 day rule on RMDs!!
In other words, if you are 70.5 or older (and now owe RMDs), you can’t start using the 60 day rule until you have already taken out your annual RMD. (sounds like age discrimination to me;)
Oh well. It would have been nice if the Tax law writers had slipped some exception for giving to charity on this issue.
Click the picture above to learn more about IRA rollovers in general or click here for more about the 60 day rule and how it doesn’t for well for people age 70.5+.