10-Year Rule for Inherited IRAs

The SECURE Act created the rule for owners who died after December 31, 2019; before then, any individual heir could stretch withdrawals over their own life expectancy. It covers IRAs, including Roth IRAs, and defined contribution plans such as a 401(k) or 403(b), with a later start (deaths after 2021) for governmental and some collectively bargained plans.

The deadline counts calendar years, not days: the account must be empty by December 31 of the year that contains the 10th anniversary of the death. An owner who died at any point in 2025 therefore sets a deadline of December 31, 2035. Anything left after that date counts as a missed required distribution.

The rule applies to designated beneficiaries, meaning individuals named to inherit, who are not eligible designated beneficiaries: typically adult children, grandchildren, nieces, nephews and friends more than 10 years younger than the owner.

Two rules with similar names work differently. The five-year rule applies instead when the beneficiary is not a person, such as an estate, a charity or a non-qualifying trust, and the owner died before the required beginning date. The Roth five-year rule decides whether Roth earnings come out tax-free, not when the account must be empty.

It depends on whether the original owner had reached their required beginning date, the April 1 after the year they reached RMD age.

If the owner died before that date, or the account is a Roth IRA, there are no annual minimums. You can withdraw any amount in any year, including nothing until year 10, as long as the account is empty by the deadline. Roth owners count as dying before their required beginning date because they never face lifetime required minimum distributions.

If the owner died on or after that date, annual RMDs continue in years 1 through 9. Each is the prior year-end balance divided by the beneficiary’s single life expectancy, or by the owner’s remaining life expectancy if that is longer, with the divisor dropping by one each year. Final regulations published in 2024 confirmed this reading and apply from 2025.

For 2021 through 2024, IRS Notices 2022-53, 2023-54 and 2024-35 excused skipped annual amounts, so a beneficiary who took nothing in those years owes no excise tax for them, though those years still count toward the 10. From 2025 on, a missed annual RMD triggers the 25% excise tax, cut to 10% if corrected within two years.

Eligible designated beneficiaries, a group fixed on the date of death, can stretch an inherited IRA over their life expectancy instead of following the 10-year deadline. The rule still reaches them in three ways. An eligible beneficiary can generally choose the 10-year rule when the owner died before the required beginning date, trading annual minimums for flexibility. When a minor child of the owner turns 21, the age of majority in the final regulations, the child’s 10-year period begins, with annual payments continuing. And when an eligible beneficiary taking life-expectancy payments dies, whoever inherits from them must finish within 10 years of that death. The exempt group is:

With the whole pre-tax balance taxed within about a decade, timing is the main lever. Taking only the minimums, or nothing, until year 10 keeps money growing tax-deferred longer, but it can pile a large balance into one tax year and push much of it into higher tax brackets. Spreading the balance more evenly, or front-loading withdrawals into lower-income years such as a sabbatical or early retirement before Social Security starts, can cut the total tax. Heirs on Medicare should also watch IRMAA, which reacts to income two years later.

An inherited Roth IRA flips the logic: qualified withdrawals are tax-free, so waiting until the final year maximizes tax-free growth.

Owners can plan too. Roth conversions in the owner’s lower-bracket years move the tax from the heir to the owner at the owner’s rate. Leaving pre-tax money to charity, or giving through qualified charitable distributions after 70½, lets family inherit assets that carry less tax. Naming beneficiaries who qualify as eligible designated beneficiaries, where that fits the family, keeps the stretch available. These choices belong in a broader estate plan.

The headline rule is simple, but its traps tend to surface years later, when they cost the most. Because the deadline is fixed from the owner’s death, lost years cannot be recovered, and a successor who inherits partway through keeps the same clock. Check these points in the first year after an inheritance, then write a year-by-year withdrawal schedule and review it each January while every option is still open: