An inherited Roth IRA follows the same 10-year deadline as a traditional IRA — but there's one major advantage most beneficiaries never hear about, because the advice they find online is usually written for traditional IRAs only.
Same 10-year deadline. Very different rules along the way.
The rules here are genuinely different from a traditional IRA — advice built for one doesn't automatically apply to the other.
The tax-free nature and lack of annual withdrawal requirement is unique to Roth accounts specifically.
For a Roth account, in most cases, no — see the comparison above.
Letting it grow tax-free for the full 10 years is often the smarter move — see the strategy note below.
Since there's no annual RMD requirement and no tax owed on qualified withdrawals, there's often little reason to withdraw early — every year left in the account is another year of tax-free growth.
Withdrawals are only fully tax-free if the original Roth IRA had been open at least five years, measured from the owner's first contribution — not reset when the account passes to you.
Even with no annual requirement, missing the final 10-year deadline still triggers the same IRS penalty as a traditional IRA — 25% of what should have been withdrawn, reduced to 10% if corrected within two years.
This is one of the more overlooked pieces of estate and inheritance planning — treating an inherited Roth IRA the same way as an inherited traditional IRA can mean withdrawing earlier than necessary and giving up years of tax-free growth for no real benefit.
Yes — most non-spouse beneficiaries must fully empty the account within 10 years, the same deadline that applies to inherited traditional IRAs.
Generally no — since the original owner was never subject to lifetime RMDs, there's no annual withdrawal requirement during years 1–9, regardless of when they died.
Generally tax-free, provided the original account satisfied the five-year holding requirement, measured from the owner's first contribution.
An IRS excise tax of 25% of the amount that should have been withdrawn, reduced to 10% if corrected within two years — even though the withdrawal itself is tax-free.
Yes — the same eligible designated beneficiary categories as traditional IRAs apply: spouses, minor children, disabled or chronically ill beneficiaries, and those close in age to the owner.
Tell us a little about your situation. Lee reviews every submission personally and follows up within one business day.