Non-Spouse Inherited IRA Rules: The 10-Year Mandate Explained

What Changed for Non-Spouse Beneficiaries

Before 2020, a non-spouse beneficiary who inherited an IRA could stretch distributions over their own life expectancy — sometimes decades. The SECURE Act eliminated that option for most non-spouse heirs. If you inherited an IRA from someone who died on or after January 1, 2020, and you're not an eligible designated beneficiary, you must empty the account within 10 years.

The distinction that trips people up: whether you also need to take annual distributions during that window, or whether you can wait until year 10 and take everything at once.

The Annual RMD Question

The answer depends entirely on whether the original IRA owner had reached their Required Beginning Date when they died. The RBD is currently April 1 of the year after the owner turns 73 (for those born between 1951 and 1959) or 75 (for those born after 1959).

Owner died before their RBD: No annual RMDs required. You can leave the money untouched for nine years and withdraw everything in year 10. The only deadline is December 31 of the tenth year.

Owner died on or after their RBD: Annual RMDs are mandatory in years 1 through 9, calculated using your own life expectancy from the IRS Single Life Table. The remaining balance must come out in year 10. The IRS waived the penalty for missing these annual distributions for tax years 2021 through 2024, but that relief is over — starting in 2025, the 25% excise tax applies to any shortfall.

Who Qualifies as a Non-Spouse Designated Beneficiary

If you're an adult child, sibling, friend, or any other individual named as beneficiary who doesn't meet the narrow EDB criteria, you're in this category. The eligible designated beneficiary exceptions are limited to:

• Surviving spouses
• Disabled or chronically ill individuals (as defined by the IRC)
• Minor children of the deceased (not grandchildren) until they turn 21
• Individuals not more than 10 years younger than the deceased owner

Everyone else — including adult children, which is the most common scenario — falls under the 10-year rule.

Tax Planning Over the 10-Year Window

The biggest mistake non-spouse beneficiaries make is ignoring the account for nine years and then taking a massive lump-sum distribution in year 10. If you inherited a $400,000 traditional IRA, adding $400,000 to your income in a single year could push you into the 37% federal bracket.

A smarter approach: spread distributions across the full 10 years, calibrating each year's withdrawal to stay within a lower tax bracket. Some beneficiaries take larger distributions in years when their other income is lower — between jobs, during a sabbatical, or before other income sources kick in.

For inherited Roth IRAs, the 10-year timeline still applies, but since distributions are tax-free, there's less urgency to distribute early. Letting the Roth grow tax-free for the full decade maximizes the benefit.

The retirement account claims guide includes a year-by-year distribution planner specifically designed for non-spouse beneficiaries navigating the 10-year window, with tax-bracket modeling worksheets that help you find the optimal annual withdrawal amount.