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Which inherited IRA rule applies to you?
Five questions. You'll find out whether you must take a withdrawal every year, when the account has to be emptied, and what happens if you miss a deadline.
How the rules fit together
Congress replaced the old stretch IRA with the SECURE Act in 2019. For deaths on or after January 1, 2020, most people who inherit a retirement account from someone other than a spouse have ten years to empty it, rather than a lifetime.
The confusing part came later. In 2022 the IRS took the position that a beneficiary of an owner who had already started taking withdrawals cannot simply switch them off — so those beneficiaries owe an annual distribution in years one through nine and face the year-ten deadline. Many advisors had told clients the opposite. The IRS waived the penalty for several transition years while the rules were finalized, and enforcement resumed in 2025.
The four beneficiary categories
| Category | Who it covers | Deadline |
|---|---|---|
| Surviving spouse | Married to the account owner at death | May treat the IRA as their own; no ten-year clock |
| Eligible designated beneficiary | Owner's child under 21, a disabled or chronically ill person, or anyone not more than ten years younger than the owner | May stretch withdrawals over life expectancy; a minor child switches to the ten-year clock at 21 |
| Designated beneficiary | Everyone else named on the account — most adult children | Empty by December 31 of year ten |
| Pre-2020 inheritance | Original owner died before January 1, 2020 | Old stretch rules still apply |
Calculate your annual required amount — enter the balance and your age to see the figure and the factor behind it.
What the year-ten deadline actually costs
The deadline itself is not the expensive part — the tax bracket is. A traditional IRA is taxed as ordinary income when it comes out. Someone who leaves a $400,000 inherited IRA untouched for nine years and withdraws it all in year ten stacks that entire balance on top of one year's salary, which can push a large slice of it into the highest brackets and trigger other income-linked costs such as higher Medicare premiums two years later.
Spreading the same balance across ten years usually costs less in total tax, even though the money leaves the tax-deferred account sooner. The right split depends on your own income in each of those years, which is why this is worth modeling rather than guessing.
Common questions
Do I have to take annual RMDs from an inherited IRA?
Two things decide it. Roth accounts have no annual requirement for beneficiaries at all. For a traditional IRA, the question is whether the original owner had reached their required beginning date before dying — roughly, whether they had started taking their own withdrawals. If they had, annual distributions continue for you in years one through nine. If they had not, you can take nothing until year ten as long as the account is empty by the deadline.
How is the annual amount calculated?
It is based on your own life expectancy factor from the IRS Single Life Table, not the original owner's, using the account balance as of December 31 of the prior year. The factor is set in the first year and reduced by one each year after. Your IRA custodian will usually calculate the figure for you on request, and it is worth asking them to confirm it in writing.
What if I already missed a year?
The excise tax on a missed distribution is 25 percent of the shortfall, reduced to 10 percent if you correct it within the two-year correction window. Form 5329 is used to report it and to request a waiver for reasonable cause. This is a situation where a CPA is worth the fee — the waiver request is routinely granted when the shortfall is fixed promptly and explained honestly.
Does the ten-year rule apply to inherited Roth IRAs?
Yes, the ten-year deadline applies. What does not apply is the annual withdrawal requirement, because Roth accounts never had required minimum distributions during the owner's lifetime. In practice this often flips the strategy: with no tax due on qualified withdrawals, many beneficiaries leave a Roth untouched for the full ten years and let it grow.
I inherited from someone who died in 2018. Does any of this apply?
No. The ten-year rule applies to deaths on or after January 1, 2020. If you inherited before that, you remain under the older rules and can continue taking distributions over your life expectancy.
This tool is educational and does not constitute tax, legal, or investment advice. The rules described here have changed several times since 2019 and contain exceptions this page does not cover. Confirm your own situation with a CPA or a qualified tax advisor before acting, and ask your IRA custodian to confirm any calculated amount in writing.