Inherited IRA 10-Year Rule Explained With an Example

What the 10-year rule says

If you have inherited an IRA, the first question is usually how long you have to empty it, and the second is whether you must take money out every year. The answers depend on three facts: who you are in relation to the owner, whether the owner had already reached their required beginning date, and how old you were when the account passed to you.

For most people who inherit an IRA, the entire balance must be withdrawn by December 31 of the year that contains the tenth anniversary of the owner’s death. If the owner died in 2024, the deadline is December 31, 2034. The rule applies to designated beneficiaries who are not “eligible designated beneficiaries”, which in practice usually means adult children, grandchildren and other individuals who do not fall into one of the exempt groups below.

Who is exempt from the 10-year rule

The IRS calls the exempt groups eligible designated beneficiaries. They are:

the owner’s surviving spouse,
the owner’s minor child,
a disabled or chronically ill person, and
an individual who is not more than 10 years younger than the owner.

Eligible designated beneficiaries can generally take distributions over their own life expectancy instead. When the owner died before the required beginning date, an eligible beneficiary can also choose the 10-year rule. A surviving spouse has an additional option, which is to treat the IRA as their own. That choice changes the rules completely, and the calculator does not model it.

Do you have to take money out every year?

This is the question many online explanations get wrong, and the answer turns on the owner’s required beginning date. That date is April 1 of the year after the owner reached their RMD age, which is 73 for people born from 1951 through 1958 and 75 for people born in 1960 or later.

If the owner died before the required beginning date, the 10-year rule requires no payments in years one through nine. You can leave the money in the account and withdraw the whole balance in year ten, or take it out earlier in whatever pattern suits your taxes.

If the owner died on or after the required beginning date, the final regulations require yearly distributions to continue and the account to be empty by the end of year ten. You take an annual amount in years one through nine and the remainder in year ten. Separately, if the owner had not yet taken their own RMD in the year they died, that RMD must still be withdrawn.

How the yearly amount is calculated

When yearly distributions are required, the divisor comes from the IRS Single Life Expectancy Table (Table I in Publication 590-B). For an owner who died on or after the required beginning date, you use the longer of two numbers. One is your own life expectancy from Table I, using your age in the year after death and then reducing the figure by one each following year. The other is the owner’s remaining life expectancy: the figure for the owner’s age at their birthday in the year of death, reduced by one for each year after that year. Your yearly distribution is the previous December 31 balance divided by that divisor.

A worked example, year by year

The owner died in 2024 at age 80, after the required beginning date. You were born in 1975, so you are not an eligible designated beneficiary, and the account held $300,000.00 on December 31, 2025. To keep the arithmetic visible we assume no investment growth.

You were 50 in 2025. Table I gives 36.2 for age 50, and reducing it by one for 2026 gives 35.2.
The owner’s Table I figure at age 80 is 11.2, reduced by two (2026 is two years after 2024) to 9.2.
The longer figure, 35.2, is the divisor. The 2026 distribution is $300,000.00 ÷ 35.2 = $8,522.73.

Inherited IRA schedule, owner died in 2024 at 80, beneficiary born in 1975
Year	Beneficiary age	Divisor	Start balance	Distribution
2026	51	35.2	$300,000.00	$8,522.73
2027	52	34.2	$291,477.27	$8,522.73
2028	53	33.2	$282,954.54	$8,522.73
2029	54	32.2	$274,431.81	$8,522.73
2030	55	31.2	$265,909.08	$8,522.73
2031	56	30.2	$257,386.35	$8,522.73
2032	57	29.2	$248,863.62	$8,522.73
2033	58	28.2	$240,340.89	$8,522.73
2034	59	27.2	$231,818.16	$231,818.16

In 2034, the tenth year, the whole remaining balance of $231,818.16 must be withdrawn. With real investment returns the balance and the distributions will differ, but the structure is the same. The large last payment is why many beneficiaries plan extra withdrawals in earlier years rather than leaving everything for year ten, which can push a single year’s income into a higher tax bracket.

RMD calculatorEnter the owner’s death year, the beneficiary’s birth year and the balance to see your own schedule.

What happens if you miss a required distribution

The IRS charges an excise tax of 25% on the amount you should have withdrawn and did not. It drops to 10% if you correct the shortfall within two years, according to the IRS RMD comparison chart. On a missed $8,000.00 that is $2,000.00, or $800.00 if corrected in time. A tax professional can tell you how to correct a missed distribution and request relief where it applies.

What the calculator does not cover

The RMD calculator is limited to cases where the IRS tables give one clear answer. It does not handle a minor child of the owner, who takes life-expectancy payments until reaching the age of majority and then falls under the 10-year rule. It does not handle beneficiaries that are not people, such as estates or charities, a surviving spouse who rolls the account into their own IRA, or the special handling of inherited Roth accounts. For those, read IRS Publication 590-B or ask a tax professional.

A quick checklist

Confirm whether you are an eligible designated beneficiary.
Find out whether the owner died before or after the required beginning date.
Note the year of death, because the 10-year clock starts then, not when you open the inherited account.
If yearly distributions are required, calculate each year from the previous December 31 balance.
Remember the owner’s own RMD for the year of death if it had not been taken.
Mark December 31 of the tenth year in your calendar.

Common questions

Does the 10-year clock start when I open the inherited account?

No. It starts with the owner’s death. The deadline is December 31 of the tenth year after the year of death, whatever date you retitled the account.

Can I wait until year ten to take everything out?

Only if the owner died before their required beginning date. If they died on or after it, yearly distributions are also required in years one to nine.

Is a surviving spouse subject to the 10-year rule?

A surviving spouse is an eligible designated beneficiary and can generally take life-expectancy payments, or treat the IRA as their own. A spouse can also choose the 10-year rule where the owner died before the required beginning date.

Is the money taxed when I withdraw it?

Withdrawals from an inherited traditional IRA are generally taxable income in the year you take them. Inherited Roth accounts have their own rules. A tax professional can advise on the timing that suits your situation.

Sources

Reviewed on 18 Oct 2026 against the published sources below. Laws and prices change, so check the current position before you rely on a figure.

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This guide is general information, not legal, financial or religious advice. Figures are estimates worked out from the sources above and may differ from what applies to you. See the disclaimer. Found a mistake? Tell us.