Understand your beneficiary distribution options.
As an IRA beneficiary, your distribution options will depend on these factors:- What the IRA plan agreement allows
- When the IRA owner died
- Your age and relationship to the IRA owner
Traditional and Roth IRA Beneficiary options when IRA owner dies on or after January 1, 2020.*
Spouse
- Transfer
- Rollover
- 10-year rule
- Life expectancy payments
Non-spouse not more than 10 years younger than the IRA owner, IRA owner's minor child, disabled or chronically ill persons, beneficiaries of IRA owners who died before January 1, 2020.
- Lump sum
- 10-year rule
- Life expectancy payments
Non-spouse more than 10 years younger than the IRA owner.
- Lump sum
- 10-year rule
Lump Sum Distribution: You may withdraw the total amount of inherited IRA assets from the IRA. Lump sum payments may be taken at any time.
10-Year Rule: If the IRA owner died before the Required Beginning Date (RBD), you must take annual life expectancy payments for the first nine years—and a total distribution by December 31 of the 10th year after the IRA owner's death.
Single Life Expectancy Payments: If taking single life expectancy payments, you generally must take annual distributions of a minimum amount based on your single life expectancy, beginning December 31 of the year following the year of the IRA owner's death. Spouse beneficiaries may delay payments until the year the IRA owner would have turned age 73.**
Spouse beneficiaries: If you're a spouse beneficiary, you may transfer or roll over inherited assets to your own IRA. The proposed RMD regulations, however, may impose certain restrictions, so it's important to discuss your options with a competent tax advisor.***
For more information, as well as options for when an IRA owner died before January 1, 2020, please see our full Inherited IRA Brochure.
Talk to a competent tax advisor about your options.
10-Year Rule: If the IRA owner died before the Required Beginning Date (RBD), you must take annual life expectancy payments for the first nine years—and a total distribution by December 31 of the 10th year after the IRA owner's death.
Single Life Expectancy Payments: If taking single life expectancy payments, you generally must take annual distributions of a minimum amount based on your single life expectancy, beginning December 31 of the year following the year of the IRA owner's death. Spouse beneficiaries may delay payments until the year the IRA owner would have turned age 73.**
Spouse beneficiaries: If you're a spouse beneficiary, you may transfer or roll over inherited assets to your own IRA. The proposed RMD regulations, however, may impose certain restrictions, so it's important to discuss your options with a competent tax advisor.***
For more information, as well as options for when an IRA owner died before January 1, 2020, please see our full Inherited IRA Brochure.
Talk to a competent tax advisor about your options.
Is there a deadline for choosing a distribution option?
If you have distribution options as a beneficiary, you generally have until December 31 of the year following the year of the IRA owner's death to decide which option you prefer. But at any time, you can speed up your withdrawals or distribute the entire amount.
Will I have to pay tax on my inherited IRA assets?
You generally must pay tax on inherited IRA assets. But depending on the type of IRA and the assets within it, your IRA distribution may be tax-free. Consult a competent tax advisor for information on your specific tax consequences.
If you have distribution options as a beneficiary, you generally have until December 31 of the year following the year of the IRA owner's death to decide which option you prefer. But at any time, you can speed up your withdrawals or distribute the entire amount.
Will I have to pay tax on my inherited IRA assets?
You generally must pay tax on inherited IRA assets. But depending on the type of IRA and the assets within it, your IRA distribution may be tax-free. Consult a competent tax advisor for information on your specific tax consequences.
