Inherited IRA RMD Basics: The 10-Year Rule in 2026

Most non-spouse beneficiaries who inherit an IRA after 2019 must withdraw the entire account balance within 10 years of the original owner's death. This "10-year rule," created by the SECURE Act (Pub. L. 116-94), eliminated the former "stretch IRA" strategy that allowed beneficiaries to take distributions over their own life expectancy. Spouse beneficiaries and a small group of other "eligible designated beneficiaries" are exempt from this rule and retain more flexible distribution options.

Important: Inherited IRA rules are among the most complex areas of retirement tax law, with ongoing IRS regulatory guidance still being finalized. The information below is definitional and explains the general framework. Consult a tax professional for advice specific to your situation.

The 10-year rule for most beneficiaries

Before the SECURE Act took effect on January 1, 2020, a beneficiary who inherited an IRA could "stretch" distributions over their own life expectancy. A 30-year-old inheriting a $500,000 IRA could take small annual distributions over 50+ years, allowing the remainder to continue growing tax-deferred.

The SECURE Act replaced this with a 10-year maximum distribution window for most non-spouse beneficiaries. The entire inherited account must be emptied by December 31 of the 10th year following the year of the original owner's death. There is no requirement to take equal annual amounts; the beneficiary can withdraw any amount in any pattern, as long as the account reaches zero by the deadline.

This change primarily affects adult children who inherit a parent's IRA, which is the most common inherited IRA scenario. It also applies to friends, non-spouse partners, and most trusts named as beneficiaries.

Who is an eligible designated beneficiary?

Congress carved out five categories of beneficiaries who are exempt from the 10-year rule and can still use the life-expectancy method:

1. Surviving spouse of the account owner
2. Minor children of the account owner (not grandchildren), until they reach the age of majority
3. Disabled individuals as defined under IRC §72(m)(7)
4. Chronically ill individuals as defined under IRC §7702B(c)(2)
5. Individuals not more than 10 years younger than the deceased account owner

Once a minor child reaches the age of majority (generally 21, though this varies by state), they become subject to the 10-year rule from that point. The 10-year clock starts when the child reaches majority, not when the original owner died.

Spouse beneficiary options

Surviving spouses have the most flexibility among all beneficiary types. A surviving spouse can:

• Treat the inherited IRA as their own: The spouse becomes the owner of the account. RMDs are based on the spouse's own age and the Uniform Lifetime Table, starting when the spouse reaches age 73.
• Roll it into their own IRA: This has the same effect as treating it as their own. The inherited account merges with the spouse's existing IRA.
• Remain as beneficiary: The spouse can keep the account titled as an inherited IRA. This may be useful if the spouse is under 59.5 and needs access to the funds without the 10% early withdrawal penalty.
• Take a lump sum: The spouse can withdraw the entire balance at once, though this creates a large taxable event.

The best option depends on the spouse's age, other income sources, and need for access to the funds. A tax professional can model the long-term tax impact of each choice.

Annual RMDs within the 10-year window

One of the most confusing aspects of the post-SECURE inherited IRA rules is whether annual distributions are required during the 10-year window, or whether the beneficiary can simply wait and take a lump sum in year 10.

The answer depends on whether the original owner died before or after their required beginning date:

• Owner died before required beginning date: No annual RMDs are required. The beneficiary can take distributions in any amount and at any time, as long as the account is fully distributed by the end of year 10.
• Owner died on or after required beginning date: Annual distributions are required in years 1 through 9, based on the beneficiary's single life expectancy. The remaining balance must be distributed in year 10.

The IRS proposed regulations in February 2022 and provided transition relief for 2021 through 2024 (Notice 2024-35), waiving penalties for beneficiaries who did not take annual distributions. Final regulations are expected to clarify these rules going forward.

Non-designated beneficiaries

If the inherited IRA was left to an estate, a charity, or a non-qualifying trust (rather than an individual), the beneficiary is classified as a "non-designated beneficiary." Different timelines apply:

• If the owner died before their required beginning date, the account must be distributed within 5 years.
• If the owner died after their required beginning date, distributions are based on the deceased owner's remaining single life expectancy.

Why professional guidance matters

Inherited IRA rules sit at the intersection of federal tax law, estate planning, and ongoing regulatory changes. The IRS has yet to finalize all regulations implementing the SECURE Act's changes, and several aspects remain subject to transition relief and interpretive guidance.

Key decisions, such as whether to disclaim an inheritance, how to time distributions within the 10-year window for tax efficiency, and how inherited accounts interact with the beneficiary's own retirement planning, have long-term financial consequences that vary significantly based on individual circumstances.

A tax professional or estate planning attorney can help you evaluate your specific situation. For general information on how RMDs work for account owners (as opposed to beneficiaries), see our RMD calculator and RMD glossary entry.