IRA beneficiaries may be required to take required minimum distributions, which can be a taxable event. Non-spousal beneficiaries must withdraw all funds from an inherited IRA within 10 years of the original owner’s death.

What is the 10 year distribution rule for inherited IRA?

The 10-year rule requires the IRA beneficiaries who are not taking life expectancy payments to withdraw the entire balance of the IRA by December 31 of the year containing the 10th anniversary of the owner’s death.

Can a beneficiary of an inherited IRA take a RMD?

If you are an eligible designated beneficiary, you can still withdraw RMDs based on your age. If the beneficiary is an entity, charity, or nonqualifying trust, and the owner was still living by April 1 of the year in which the account holder reached age 72,* the distributions would be based on the remaining Single Life Expectancy of the IRA owner.

When to start RMD distribution after spouse dies?

The timing of the initial distribution may be based on your spouse’s age at the time of his/her death. If your spouse was: Older than age 70½, you must begin taking RMDs by December 31 of the year following your spouse’s death. Younger than 70½, you may be able to delay RMDs until your spouse would have turned 70½.

When do you have to take a RMD from an IRA?

Minor children. Annual RMDs based on the child’s age can be taken until the child reaches the “age of majority” in their state. That’s typically age 18. At that point, any remaining money in the IRA will need to be withdrawn according to the 10-year rule.

When do beneficiaries of inherited IRAs have to be distributed?

Any individual beneficiary may elect to distribute the inherited IRA assets over the five years following the owner’s death. The distribution must be completed by the end of the year containing the fifth anniversary of the owner’s death.