Inherited IRA 2026: The 10-Year Rule
Inheriting a retirement account comes with a ticking clock. Under the SECURE Act, most non-spouse heirs must empty the account within 10 years — and miss the deadline and you owe a penalty. Here is the 2026 rulebook.
Non-spouse rule
10 years
To empty the account
Spouse
Treat as own
Most flexible option
Traditional withdrawals
Taxable
Ordinary income
Inherited Roth
Tax-free
If held 5+ years
What an Inherited IRA Is
When you inherit an IRA, you do not just get the money — you inherit a set of distribution rules. The options depend on your relationship to the deceased: spouse, eligible designated beneficiary, or everyone else. Getting it wrong can trigger penalties, so the first step is knowing which category you fall into.
See your bracket for withdrawals
Understand the tax on money you take out.
The 10-Year Rule for Non-Spouses
Most non-spouse beneficiaries — including adult children — must withdraw the entire inherited account by December 31 of the 10th year after the owner's death. There is no required amount each year; you just must be at zero by the deadline. Missing it exposes the remaining balance to a penalty, so the smart move is usually to spread withdrawals strategically across the 10 years to manage your tax bracket.
Special Rules for Spouses
A surviving spouse has the most flexibility, including the ability to treat the IRA as their own — rolling it into an existing IRA and deferring distributions until their own RMD age. Spouses can also take distributions over their life expectancy. This flexibility makes the spouse category by far the most favorable.
Eligible Designated Beneficiaries
A few beneficiaries get the old "stretch" treatment — distributions over their own life expectancy rather than the 10-year rule:
- A minor child of the deceased (until reaching adulthood, then the 10-year clock starts).
- A disabled or chronically ill individual.
- A beneficiary not more than 10 years younger than the deceased.
How Withdrawals Are Taxed
Withdrawals from an inherited traditional IRA are taxed as ordinary income — there is no 10% early-withdrawal penalty for beneficiaries, regardless of age. An inherited Roth IRA is tax-free if the original owner held it at least five years. Because the inherited account cannot be rolled into your own, the distributions are always taxable events, which is why timing them across the 10 years matters.
Frequently Asked Questions
Can I roll an inherited IRA into my own IRA?
Only if you are the spouse. Non-spouse beneficiaries cannot roll an inherited IRA into their own account — it must stay titled as an inherited IRA and be distributed on the 10-year (or life-expectancy) schedule.
Is there an annual required withdrawal in the 10 years?
For most non-spouse beneficiaries, no — you can take nothing for nine years and everything in year ten. (Certain cases, like when the original owner was already taking RMDs, may require annual withdrawals, so confirm with the custodian.)
What is the penalty for missing the 10-year deadline?
The IRS can impose a penalty on the amount that should have been withdrawn but was not — potentially substantial. The best protection is a withdrawal plan that front-loads distributions over the 10 years.
Does an inherited IRA get a step-up in basis?
No. Unlike stocks or real estate, retirement accounts do not get a step-up in basis — every dollar withdrawn from a traditional inherited IRA is ordinary income.
Sources
- SECURE Act and SECURE 2.0 — 10-year rule for inherited IRAs.
- IRS Publication 590-B — Distributions from IRAs (beneficiary rules).
- IRS — eligible designated beneficiary categories.
This is informational, not tax advice. Inherited IRA rules are complex and depend on your relationship and the account type — consult a tax professional.