Can You Make a QCD From an Inherited IRA Under the SECURE Act?

You can make a Qualified Charitable Distribution from an inherited IRA, but only if you — the beneficiary taking the distribution — are at least 70½ years old on the date the money leaves the account. The IRS confirmed this in Notice 2007-7, and eligibility turns on the beneficiary’s age, not the age the original owner had reached at death.¹ For 2026, the annual QCD exclusion is capped at $111,000 per person.²

The Age Rule Is the Whole Ballgame

Notice 2007-7, Q&A 37 is explicit: a QCD from an inherited IRA is allowed if the beneficiary has reached 70½ before the distribution is made.¹ The original owner’s age at death does not matter. Neither does whether the owner had started taking required minimum distributions. What matters is how old you are on the day the custodian sends the money to the charity.

The 70½ threshold is set by statute and has not moved, even though the required minimum distribution age is now 73.³ So the gap matters: a beneficiary can qualify to make QCDs years before any RMD is personally owed on their own retirement accounts.

This is where the SECURE Act’s 10-year rule collides with reality. Most non-spouse beneficiaries who inherited an IRA after December 31, 2019, must empty the entire account by the end of the tenth year following the original owner’s death.⁴ A 55-year-old who inherits a parent’s $400,000 traditional IRA faces a decade of forced taxable income and cannot use QCDs to blunt it. The beneficiaries who can actually use this tool are typically siblings, older friends, or others close in age to the decedent — the 73-year-old who inherits from a 68-year-old sibling can start QCDs immediately.

How Much You Can Give and From Which Accounts

The 2026 exclusion is up to $111,000 per person, indexed annually for inflation.² That cap is per individual, not per account, so if you have your own IRA and an inherited IRA, QCDs from both share the same $111,000 ceiling. A married couple with separate IRAs each get their own cap.

QCDs can come from a traditional IRA, including an inherited traditional IRA. They cannot come from a SEP IRA or SIMPLE IRA that is still receiving employer contributions; Section 408 excludes those plans by cross-reference to subsections (k) and (p).³ If you inherited a SEP or SIMPLE that is no longer receiving contributions, ask the custodian whether it can be treated as a traditional IRA for this purpose.

The money has to move directly from the IRA custodian to the charity. If it passes through your hands first, the exclusion is lost and the distribution becomes taxable.⁵

The recipient must be a charity eligible for a deductible contribution under Section 170(b)(1)(A), with two exclusions that trip people up: donor-advised funds and supporting organizations do not qualify, and most private foundations are also out.³ If you normally give through a donor-advised fund, the QCD has to go to the underlying operating charity instead.

Using a QCD to Satisfy an Inherited IRA RMD

A QCD can offset a required minimum distribution dollar for dollar, which is the most tax-efficient way to clear an RMD. But whether an inherited IRA actually carries an annual RMD depends on when the original owner died.

If the Owner Died Before Their Required Beginning Date

The required beginning date is April 1 of the year after the owner turns 73.⁶ If the owner died before reaching it, a non-eligible-designated beneficiary does not have to take distributions in years one through nine; only the full-emptying deadline at year ten applies. A beneficiary who is 70½ or older can still make voluntary QCDs in those years and exclude them from income. There is just no annual RMD being offset.

If the Owner Died On or After Their Required Beginning Date

Here the beneficiary must take annual RMDs in years one through nine and empty the account by the end of year ten. For a QCD-eligible beneficiary, this is where the strategy earns its keep: the QCD satisfies the annual RMD without adding anything to adjusted gross income.

Make the QCD Before Any Other Withdrawal

One sequencing rule matters. The first dollars distributed from an IRA in a year are treated as satisfying the RMD until it is met. If you pull cash for personal use first and that covers the full RMD, a later QCD does not retroactively offset the RMD — it becomes an additional distribution. Run the QCD first.

If You Made Deductible IRA Contributions After 70½

The QCD exclusion is reduced by any deductible IRA contributions you made at age 70½ or older. It works as a running lifetime offset: each dollar deducted after that age permanently cuts the amount you can later exclude as a QCD, less any amount already applied in prior years.³ IRS Publication 590-B contains a QCD Adjustment Worksheet that walks through the calculation.⁷ The people most affected are those who kept working past 70½ and claimed traditional IRA deductions during those years.

How QCDs Handle After-Tax Basis

If the inherited IRA holds any nondeductible (after-tax) contributions, QCDs are treated favorably. Normal distributions follow a pro-rata rule, with each withdrawal pulling a mix of pre-tax and after-tax dollars. Under Section 408(d)(8)(D), a QCD is treated as coming entirely from the pre-tax portion first.³ The QCD absorbs the taxable dollars and leaves the after-tax basis intact for future personal withdrawals.

Reporting the QCD Correctly

The custodian reports the gross distribution on Form 1099-R. For an inherited IRA, Box 7 usually shows Code 4 for a death distribution. Starting with 2025 distributions, custodians can add Code Y to specifically flag a QCD from an inherited account, though not every custodian uses it yet.⁸

On Form 1040, enter the gross distribution on line 4a. If the entire amount qualifies as a QCD, enter zero on line 4b for the taxable amount, then check box 2 on line 4c to identify it as a qualified charitable distribution.⁹ Older guidance told taxpayers to write “QCD” next to the line; the current form uses the checkbox.⁷ Keep the charity’s written acknowledgment and the custodian’s confirmation of the direct transfer. If the IRS asks, the burden of proof is on you.

Timing, Penalties, and the Year-End Trap

A missed inherited IRA RMD triggers a 25% excise tax on the shortfall. Correct it within two years and the penalty drops to 10%.⁶ The same tax applies to any balance left in the inherited IRA after the end of the 10-year window.

The practical risk for QCD-using beneficiaries is calendar risk. A QCD only counts for the year it reaches the charity. Custodians can take weeks to process direct charitable transfers, and the year-end backlog is real. Starting the paperwork in early November rather than late December is the difference between a clean, tax-free RMD and a processing delay that converts a planned QCD into a missed distribution carrying a 25% penalty.

1
IRS. Miscellaneous Pension Protection Act Changes Notice 2007-7
2
IRS. 2026 Amounts Relating to Retirement Plans and IRAs, as Adjusted
3
Office of the Law Revision Counsel. 26 U.S. Code 408 – Individual Retirement Accounts
4
Internal Revenue Service. Retirement Topics – Beneficiary
5
Internal Revenue Service. IRS Tax Tip: Seniors Can Reduce Their Tax Burden by Donating to Charity Through Their IRA
6
Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs
7
Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
8
IRS. 2025 Instructions for Forms 1099-R and 5498
9
IRS. 2025 Instructions for Form 1040