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RMD required
Inherited IRA
An inherited IRA (or inherited 401(k)) is a retirement account passed to a beneficiary after the original owner's death. Distribution rules changed significantly under the SECURE Act of 2019.
Rules depend on beneficiary type and whether the owner died before or after RBD.
Who might have one?
- Adult children who inherited a parent's retirement account
- Surviving spouses named as beneficiary
- Siblings, grandchildren, or other named beneficiaries
- Trusts or estates listed as account beneficiaries
Why would you have one?
- You were named beneficiary on a retirement account
- A spouse rolled over or transferred a deceased spouse's account
- You received account assets through an estate settlement
How RMDs work for this account
Inherited account rules depend on your relationship to the deceased, whether they had started RMDs, and whether you qualify as an eligible designated beneficiary. Options include life expectancy stretch, the 10-year rule, or spousal rollover. Non-spouse beneficiaries generally must empty the account within 10 years.
Common mistakes
- Assuming inherited IRA rules match your own IRA RMD rules
- Missing the 10-year deadline for non-eligible beneficiaries
- Not exploring spousal options (rollover vs. stretch vs. 10-year)
- Failing to take annual RMDs when the original owner died after their RBD
Frequently asked questions
- Do inherited IRAs require RMDs?
- Often yes, but rules vary. Non-spouse beneficiaries may face the 10-year rule. Spouses have multiple options. Use our inherited IRA calculator for your situation.
- What is the 10-year rule for inherited IRAs?
- Most non-spouse beneficiaries must fully distribute the account by December 31 of the 10th year after the owner's death. Annual RMDs may also be required if the owner had already started RMDs.
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