Inherited Roth IRA 10-Year Rule

A designated beneficiary who is not an eligible designated beneficiary and inherits directly from a Roth IRA owner who died after 2019 generally must empty the account by December 31 of the tenth year after the owner's death, without annual RMDs in years 1–9. That is not every inherited Roth: annual life-expectancy payments can continue after a beneficiary dies or the owner's child reaches age 21. A missed required distribution can trigger a separate excise tax.

First identify the beneficiary category and any existing payout schedule. A Roth IRA owner is treated as dying before the required beginning date, which explains the direct non-EDB case above; it does not eliminate annual payments for every other category. The payout deadline is also separate from the owner's five-tax-year test for income-tax-free distributions.

The SECURE Act Changed Inherited IRA Rules

For owner deaths before 2020, an individual designated beneficiary could generally use annual life-expectancy distributions, subject to the applicable election and account rules. Younger beneficiaries could have schedules lasting decades; not every pre-2020 inheritance qualified for this method.

The Secure Act ended this. Starting with deaths on or after January 1, 2020, most non-spouse beneficiaries must now withdraw the entire inherited IRA balance within 10 years. This is a seismic shift in retirement planning for anyone with a large IRA or Roth to pass down.

Key point: For a direct non-EDB Roth inheritance after a post-2019 owner death, the rule is "empty by year ten," not "withdraw evenly over ten years." That beneficiary can take nothing in years 1–9 and empty the account in year ten. Growth is not guaranteed, and the distribution's income-tax treatment still depends on the Roth qualification test.

Did the Owner Die Before 2020? Check the Existing Schedule

If the original Roth owner died before 2020 and you validly began a life-expectancy schedule as a designated beneficiary, that schedule can generally continue. A pre-2020 death does not turn an elected or required five-year payout into a lifetime stretch. Preserve the original beneficiary classification, election and distribution records; later successor deaths have separate transition rules.

How the mechanics work for grandfathered non-spouse inheritors on life expectancy:

1. Year 1: Look up your age (the age you attained in the year following the owner's death) on the IRS Single Life Table. That factor is your divisor. RMD = December 31 prior-year balance ÷ factor.
2. Years 2+: For a non-spouse beneficiary using this method, subtract 1.0 from the initial factor for each elapsed year. The required dollar amount also depends on the prior December 31 balance, so it does not necessarily increase.
3. 2022 table transition: Recompute the original first-year factor using the updated Single Life Table, then subtract the elapsed years. Verify the calculation rather than assuming the custodian performed the reset. The transition is described in Treas. Reg. §1.401(a)(9)-9(f)(2).

What happens when the grandfathered beneficiary dies. For a sole designated beneficiary on life expectancy who dies after 2019, the successor generally faces a ten-year outer deadline measured from that beneficiary's death, with annual payments continuing under the remaining schedule. Multiple-beneficiary and surviving-spouse transition rules can change the analysis; do not assume the successor gets a new life-expectancy calculation.

Withdrawing more than the minimum. Keeping funds in the Roth preserves its tax treatment while they remain there, but taking only the minimum is not always the right cash-flow or investment choice. Required payments, spending needs, investment risk and the eventual depletion deadline all matter.

When Does the 10-Year Clock Start?

For the direct non-EDB case, year one is the calendar year following the owner's death. The deadline is the end of the calendar year containing the tenth anniversary of that death; transfer to a new custodian does not restart it.

Example: If the Roth owner died in 2024, the 10-year clock runs through the year containing the 10th anniversary of death. The beneficiary has until December 31, 2034 to empty the account.

If the Roth owner died on December 31, 2024, that counts as 2024 (death in 2024), so the 10-year period runs through December 31, 2034.

Who Is Subject to the 10-Year Rule?

For post-2019 owner deaths, most non-spouse individual beneficiaries use the ten-year rule. The five Eligible Designated Beneficiary (EDB) categories under IRC §401(a)(9)(E)(ii) are determined at the owner's death:

• Surviving spouse: Special beneficiary rules apply; a qualifying spouse can instead treat the account as their own. That choice is not universally best, particularly if the spouse needs access before age 59½.
• Disabled beneficiary: The adult standard generally follows IRC §72(m)(7); a beneficiary under 18 has a separate marked-and-severe-functional-limitations test.
• Chronically ill beneficiary: Must meet the modified IRC §7702B(c)(2) standard; the activities-of-daily-living route requires certification of an indefinite inability reasonably expected to be lengthy, not merely a 90-day condition.
• Child of the original owner under 21: If using life expectancy, reaching 21 generally starts a ten-year outer deadline, ending December 31 of the year the child turns 31. Annual payments continue; another qualifying EDB status can change that deadline.
• Beneficiary not more than 10 years younger than the owner: A sibling, partner, or close-in-age friend can still stretch.

An estate, charity or non-see-through trust named directly by the owner is not an EDB; a Roth IRA with no designated beneficiary generally has a five-year payout deadline. A see-through trust requires analysis of its counted beneficiaries. These categories must not be folded into the direct non-EDB ten-year example.

If you're unsure of your status, contact the IRA custodian immediately with the original beneficiary designation form. Misclassification can lead to missed deadlines and penalties.

When Does a Ten-Year Deadline Also Require Annual RMDs?

A ten-year deadline alone does not answer the annual-RMD question. The direct non-EDB Roth case differs from a ten-year deadline arising after life-expectancy payments have begun.

T.D. 10001 was published July 19, 2024; its regulations generally apply to distribution calendar years beginning in 2025. The SECURE Act's post-2019 owner-death rule began earlier. Under the final rules:

• For a direct non-EDB inheritance, the owner's before/after-RBD treatment helps determine whether annual payments accompany the ten-year deadline.
• A Roth IRA owner has no RBD during life—Roth IRAs are exempt from the owner's lifetime RMD rules (IRC §408A(c)(4)).
• Current Treas. Reg. §1.408-8(b)(1)(ii) treats the Roth IRA owner as dying before the RBD, no matter their age.
• Result for the direct post-2019 non-EDB case: no annual RMDs in years 1–9, with depletion by December 31 of year ten.
• If life-expectancy payments apply, §1.401(a)(9)-3(c)(4) continues annual payments until depletion, including after the beneficiary's death or the owner's child's majority. Section 1.401(a)(9)-5(e) applies the earliest applicable outer deadline.

For example, a child using life expectancy who turns 21 in 2025 generally must empty the Roth by December 31, 2035 while continuing annual payments. If that child dies in 2028, a later death-based limit does not postpone the already applicable 2035 deadline.

For the mechanics and penalty math if you ever need them, see the Inherited Roth IRA RMDs article.

Strategic Withdrawal Planning: Three Approaches

The following approaches assume a direct non-EDB Roth inheritance after a post-2019 owner death, no annual RMD obligation, and completion of the owner's five-tax-year qualification period before the illustrated withdrawals. Returns are hypothetical, not forecasts; fees, inflation and returns earned outside the Roth are excluded.

Approach 1: Delay and Lump Sum

For the direct non-EDB case just described, take no distributions in years 1–9 and empty the account in year ten. This retains more money inside the Roth but is not a guaranteed maximum-wealth strategy.

Example: The owner dies in 2024 and the inherited Roth has $200,000 on December 31, 2024. Ten full years at a hypothetical 8% return give $200,000 × 1.08¹⁰ = approximately $431,785 at the end of 2034, before the final distribution. Growth is approximately $231,785; the qualified withdrawal is excluded from federal income.

This requires meeting spending needs without the account and making the final distribution on time. Market downturns could reduce the balance; the stated return is not promised.

Approach 2: Even Distributions (Steady Income Stream)

One approach is to withdraw one-tenth of the opening balance annually, then clear the actual remaining balance in year ten. That is not ten equal payments when investments gain or lose value; the final payment can be much larger or smaller.

Example: With a $200,000 opening balance after a 2024 death, withdraw $20,000 annually in 2025–2033, then distribute the actual remaining balance by December 31, 2034. Nine payments total $180,000. Investment gains or losses change the final payment; do not assume it is exactly $20,000.

Qualified Roth distributions do not raise federal taxable income, so splitting them does not itself avoid an income-tax bracket. A staged schedule may instead fit spending needs or investment-risk preferences.

Approach 3: Partial Distributions for Changing Cash Needs

For the same direct non-EDB case, withdrawals can vary with spending needs. Qualified Roth cash does not itself fill a federal tax bracket; taxable earnings from a nonqualified distribution are different.

For example, five $15,000 withdrawals total $75,000 and four subsequent $35,000 withdrawals total $140,000: $215,000 through year nine. Year ten must distribute the actual remaining balance, not blindly another $35,000. The opening balance and investment results determine whether that schedule is feasible.

The 25% Excise Tax: What Happens If You Miss the Deadline?

For failures subject to post-2022 rules, IRC §4974 generally imposes a 25% excise tax on the required amount not distributed on time. At an account-emptying deadline, that can be the entire remaining balance. Annual-payment shortfalls can also be taxable. This is separate from income tax.

Example: Assume no investment gain or loss: $100,000 less $70,000 distributed leaves $30,000 after the final deadline. The usual tax is $30,000 × 25% = $7,500; if the reduced-rate requirements are met, it is $30,000 × 10% = $3,000, before any granted waiver.

The 10% correction window. Both the corrective distribution and a return reflecting the tax must occur within the window. It ends on the earliest of a deficiency-notice mailing, assessment, or the last day of the second taxable year beginning after the year the tax is imposed. It is not simply two years after discovering the mistake. A reasonable-error waiver is a separate request.

How to request the waiver on Form 5329. Use the form for the failure year. Under the 2025 instructions, Part IX, complete lines 52a/b and 53a/b as instructed, enter “RC” and the shortfall requested to be waived beside line 54a and/or 54b, and subtract that requested amount as directed. Attach the explanation and corrective steps, complete line 55, and pay any remaining tax shown there. The IRS decides whether to grant relief; silence is not a substitute for following the instructions.

Check withholding separately. Confirm the custodian's treatment and any applicable withholding election. A qualified distribution's federal income exclusion does not guarantee a refund: withholding is credited against the return's overall tax liability, and a refund depends on the resulting overpayment.

The bottom line: plan to be at $0 well before the deadline.

Market Risk and Planning for Unknown Growth

For a direct non-EDB inheritance following a 2024 owner death, the deadline is December 31, 2034, not 2035. If an illustrative $200,000 account falls to $150,000 by the final distribution date, the beneficiary must still withdraw the entire remaining $150,000 by that deadline; losses do not extend it.

Similarly, if the account grows to $400,000, the entire remaining $400,000 must be distributed by the deadline. Federal income exclusion depends on the qualification test, not the amount of growth.

Planning insight: Compare hypothetical returns such as 4%, 6% and 8%, but include loss scenarios too. None is a guaranteed outcome or a substitute for the actual withdrawal schedule.

Review investments and spending needs before the deadline. Reducing investment risk and withdrawing from the inherited account are different decisions; recent market performance does not establish that an early or delayed withdrawal will be better.

Multiple Beneficiaries on the Same Account: Use the Separate-Account Rule

With multiple beneficiaries, a non-EDB in the group can generally prevent EDB treatment unless separate-account rules apply. But there are exceptions, including an owner's minor child and qualifying applicable multi-beneficiary trusts; it is not true that every mixed group automatically loses life-expectancy treatment.

Under final Treas. Reg. §1.401(a)(9)-8(a), establish separate accounts meeting the separate-accounting requirements by December 31 of the year following the owner's death for separate application of the beneficiary rules. For a 2025 death, that is December 31, 2026. Post-death distributions and other account items must be properly allocated. A later physical split can still occur, but does not retroactively create the same separate-rule treatment.

For a group where everyone is a non-EDB on the 10-year rule, the separate-account split still matters for administration. Each beneficiary picks their own investments, chooses their own withdrawal timing, and names their own successor beneficiary. Nobody has to coordinate with the others to access their share. It's worth asking the custodian for the split even when the distribution deadline would be identical.

Inherited Roth vs. Inherited Traditional: Why the Annual-RMD Difference Matters

For a direct non-EDB traditional IRA inheritance after a post-2019 owner death on or after the RBD, annual payments generally accompany the ten-year deadline. If that traditional owner died before the RBD, the direct non-EDB generally has no annual payments in years 1–9. Other beneficiary categories need separate analysis.

The Roth IRA owner is always treated as dying before the RBD. Therefore the direct non-EDB Roth case has no annual payments in years 1–9, but EDB life-expectancy and successor/majority cases can. The effect on total wealth depends on returns, withdrawal timing, outside reinvestment and taxes; it is not a fixed dollar advantage.

For the detailed RMD calculation mechanics (and the traditional IRA rules), see the Inherited Roth IRA RMDs article.

Corrections and updates

September 24, 2026 — Correction: Limited the no-annual-RMD rule to its direct non-EDB case and corrected successor, child-majority, pre-2020 and multiple-beneficiary distinctions. Corrected growth examples and deadline dates, the Form 5329 correction/waiver procedure, and unsupported tax-free or universally preferred withdrawal claims. See the public correction record.