Qualified Charitable Distributions from rollover IRA?

[J Simmons]

I am new to the topic of qualified charitable distributions (QCDs) where the donor neither has taxable income by reason of the distribution nor is entitled to an income tax deduction.

My understanding is that such can be made from an IRA, but not an ongoing SEP or SIMPLE IRA.

If benefits are rolled from an ongoing SEP or SIMPLE IRA, or from a 401k plan, into an IRA, may the QCD then be made from the regular, 'rollover' IRA or is such subject to the step-transaction doctrine and treated as if the QCD was made directly out of the 401k plan, ongoing SEP or SIMPLE IRA?

Any citations to authority would be greatly appreciated as well.

[lisam]

My understanding is that such can be made from an IRA, but not an ongoing SEP or SIMPLE IRA.

I agree, based on IRS Notice 2007-7 Q&A 36.

My opinion is that a rollover would not solve this as Treasury Regulation 1.402©(2) Q&A 7 states:

if a minimum distribution is required for a calendar year, the amounts distributed during the calendar year are treated as required minimum distributions under section 401(a)(9), to the extent that the total required minimum distribution under section 401(a)(9) for the calendar year has not been satisfied. Accordingly, these amounts are not eligible rollover distributions.

Thus, if a rollover distribution is done it will first count toward the RMD even if distributed to a charity later.

Perhaps this can be done if someone were to do a direct transfer of the funds between the IRA's (and therefore there is no 1099-R created) however I couldn't find anything that supports or denies this.