Great news for retirement plan participants who wish to make charitable distributions directly from their qualified plan accounts!  A bipartisan group of Representatives and Senators have joined to co-sponsor the “Charity Parity Act,” which would allow qualified charitable distributions (QCDs) from Code section 401(k), 403(b) and 457(b) retirement plans under the same rules as those for QCDs from IRAs under Code section 408(p). Under the proposed law, participants would be able to make QCDs up the applicable limit (currently, $111,000) to their favorite charities — without an interim IRA rollover, which may cost more to maintain and may not offer the same investment options as their employer plan.

Under current law, QCDs from IRAs are not includible in taxable income and count towards an individual's annual required minimum distribution.  While QCDs do not also count as charitable contributions for other purposes, that is not necessarily a bad thing given the increasing complexity and  limitations on charitable deductions. 

Needless to say, major non-profit groups have already endorsed the bill, and more are likely to do so.  It's expected that the retirement plan community will similarly back this initiative, given the broad popularity of the concept and bipartisan legislative support.