Inherited IRA Rules: The 10-Year Rule Explained

The Short Answer

The old strategy of stretching inherited-IRA withdrawals across your whole lifetime is gone for most people. For deaths after 2019, the default for a non-spouse beneficiary is the 10-year rule: the inherited account has to be fully withdrawn by December 31 of the 10th year after the original owner died.

Three groups get different treatment: a surviving spouse, a set of eligible designated beneficiaries who can still stretch withdrawals, and beneficiaries where the owner had already started their own required withdrawals, who owe a distribution every year inside the 10-year window. Each is covered below.

The 10-Year Rule

If you inherited an IRA from someone who died in 2020 or later and you are not in one of the exempt groups below, you are a non-eligible designated beneficiary and the account must be emptied within 10 years. Practically:

• The clock runs to December 31 of the 10th year after the year of death. An account inherited from a 2024 death, for example, must be empty by the end of 2034.
• You do not have to take equal amounts, and depending on the case you may not owe anything until year 10 (see the next section).
• Leaving a large balance for a final-year lump sum can create a large one-year tax bill, so many beneficiaries spread withdrawals out on purpose.

Do You Also Owe Annual Withdrawals?

This is the part that trips people up, and the 2024 final regulations settled it. Whether you owe a withdrawal every year inside the 10-year window depends on one thing: had the original owner already reached the age when their own required minimum distributions had to begin?

• Owner died before their required-beginning date: no annual withdrawals are required. You can take nothing until year 10, take some each year, or skip years, as long as the account is empty by the deadline.
• Owner died on or after their required-beginning date: you must take a required withdrawal in each of years 1 through 9, and empty the account by year 10.

Inherited Roth IRAs are treated as if the owner died before their required-beginning date, so the 10-year emptying rule applies but annual withdrawals generally do not.

Who Can Still Stretch

A short list of eligible designated beneficiaries is exempt from the 10-year rule and can generally take withdrawals over their own life expectancy:

• a surviving spouse (with extra options, below);
• a minor child of the original owner (the 10-year clock starts when the child reaches the age of majority);
• a beneficiary who is disabled or chronically ill under the tax-law definitions; and
• a beneficiary who is not more than 10 years younger than the owner, such as a sibling or partner close in age.

Note the minor-child rule covers the owner’s own child, not a grandchild, and ends at majority. Trusts named as beneficiaries have their own complex rules and deserve professional review.

If You Are the Spouse

A surviving spouse has the most flexibility and should choose deliberately:

• Treat it as your own, by retitling or rolling it into your own IRA. It then follows the normal rules for your account, often the simplest choice.
• Stay a beneficiary and take distributions over your life expectancy, which can help if you are under 59½ and want penalty-free access.

The right choice depends on your age, your own retirement accounts, and when you need the money, which is exactly the kind of decision worth a conversation with a financial or tax advisor.

The Tax Angle

An IRA is a non-probate asset when it names a living beneficiary, so it usually passes to you directly without going through probate. That does not make it tax-free:

• Traditional IRA: withdrawals are ordinary income to you, taxed in the year you take them. This is why spreading withdrawals across the 10 years often matters.
• Roth IRA: qualified withdrawals are generally tax-free, though the account still must be emptied within 10 years for most non-spouse beneficiaries.
• Unlike inherited property, an inherited IRA does not get a stepped-up basis. The pre-tax dollars stay taxable.

If a retirement account is part of an estate you are settling, the executor checklist shows where it fits, and the inheritance guide covers what else beneficiaries receive. For your own withdrawal plan, a tax professional is the right call.