The SECURE Act (Dec 2019) ended the “stretch IRA” for most non-spouse beneficiaries who inherited an IRA after 31 December 2019. In its place: a hard 10-year deadline to empty the account, regardless of the beneficiary’s age. The IRS Final Regulations published 19 July 2024 then resolved a four-year ambiguity by confirming that beneficiaries of a decedent who had already reached their Required Beginning Date must take annual RMDs during years 1 through 9 of that 10-year window — not just empty the account by year 10.
This guide walks through the post-2024 rule set, including who escapes the 10-year cap as an “eligible designated beneficiary,” how to compute the annual RMDs when they apply, and the SECURE 2.0 penalty waivers covering missed 2021-2024 distributions.
For ground-zero RMD mechanics, see also the 2026 RMD Table guide.
1. Five categories of beneficiary
The post-SECURE rule set partitions beneficiaries into five categories with sharply different obligations:
- Surviving spouse. May treat the IRA as their own (rollover), continue as a beneficiary (use Uniform Lifetime once they reach RBD), or use the Single Life Table. Spouse beneficiaries can elect the most favorable timing — usually rollover, which restarts RMDs from the spouse’s own RBD.
- Eligible designated beneficiary (EDB) — exempt from the 10-year rule. Five sub-categories:
- Spouse (counted above; spouse-as-EDB matters mainly for choice of table)
- Disabled individual (§72(m)(7) standard)
- Chronically ill individual (§7702B(c)(2))
- Minor child of the decedent (only — not grandchild, not stepchild outside formal adoption) until age 21, then 10-year clock starts
- Beneficiary not more than 10 years younger than the decedent
- Designated beneficiary (DB) — named individual who is not an EDB. Subject to the 10-year rule.
- Non-designated beneficiary. Estate, most trusts (other than see-through trusts), or charity. Generally subject to the 5-year rule if death is before RBD, or the decedent’s remaining life expectancy if death is after RBD.
- See-through trust. Properly drafted “conduit” or “accumulation” trusts can look through to the underlying beneficiary’s EDB or DB status, but the drafting must meet four IRS requirements.
The bulk of this guide addresses category 3 — non-spouse designated beneficiaries — which is the modal case and the category the SECURE Act fundamentally redefined.
2. The 10-year rule mechanics
For a designated beneficiary who inherited after 31 December 2019:
- Year of death = year 0. The 10-year clock starts the year after death.
- Year 10 = full depletion deadline. The entire account must be distributed by 31 December of the 10th year after death.
- Years 1 through 9: depends on whether decedent had reached RBD (see next section).
- No early withdrawal penalty on inherited IRA distributions regardless of beneficiary’s age — IRC §72(t)(2)(A)(ii).
The clock does not restart if you receive an inherited IRA and split it among beneficiaries — the original date of death anchors the deadline for all sub-accounts. If you inherit a Roth IRA, the same 10-year rule applies, but distributions are tax-free if the original owner’s 5-year clock had elapsed (counted from owner’s first contribution year, not transferred to the beneficiary).
3. The 2024 Final Regs: annual RMDs during the 10-year window
For four years after the SECURE Act passed, taxpayers and the IRS argued over whether the 10-year rule also required annual RMDs during years 1-9, or whether you could let the account ride and take everything in year 10. The IRS announced penalty relief for 2021, 2022, 2023, and 2024 missed RMDs while the matter was unresolved (Notices 2022-53, 2023-54, 2024-35).
The 19 July 2024 Final Regulations (TD 10001) settled it:
| Decedent died… | Years 1-9 distribution | Year 10 |
|---|---|---|
| Before RBD | No annual RMD required | Full depletion |
| On or after RBD | Annual RMD required, using beneficiary’s Single Life Expectancy (subtract-one method) | Full depletion and the year-10 RMD |
The annual-RMD obligation applies for the 2025 distribution year onward. Beneficiaries who took nothing in 2021-2024 owe nothing retroactively, but must restart for 2025 if the decedent died after RBD.
Subtract-one method, walked through
Tim inherited a Traditional IRA from his father in 2023 when his father was 78 (well past RBD). Tim was 55 in 2024 (the year after death) — the year his Single Life Table life expectancy is fixed.
Tim’s 2024 Single Life Table divisor at age 55 = 31.6. This becomes his initial divisor.
| Year | Tim’s age | Divisor | Source |
|---|---|---|---|
| 2024 | 55 | 31.6 | Single Life Table at 55 |
| 2025 | 56 | 30.6 | 31.6 − 1 |
| 2026 | 57 | 29.6 | 30.6 − 1 |
| 2027 | 58 | 28.6 | … |
| 2033 | 64 | 22.6 | (year-10 deadline) — must take RMD for year 10 and empty the remaining balance |
For 2026, if Tim’s father’s IRA balance on 31 December 2025 was $400,000, Tim’s 2026 RMD is:
$400,000 ÷ 29.6 = $13,514
Tim must take at least $13,514 in 2026, can take more, and must completely empty the account by 31 December 2033. The unwithdrawn balance becomes a year-10 forced distribution — and the year-10 RMD calculated separately is added on top before depletion.
If Tim’s father had died before his RBD instead, Tim’s 2024-2033 obligation would be only the year-10 depletion — no annual minimums. The lump-sum approach in year 10 maximizes tax-deferred growth but stacks one large taxable distribution into the final year, often crossing several brackets.
4. Eligible Designated Beneficiary — the four non-spouse cases
EDB status preserves the pre-SECURE “stretch” — distributions over the beneficiary’s own life expectancy — with one new wrinkle: when the EDB dies, their successor beneficiary is then subject to the 10-year rule. So the stretch persists for one generation only.
4.1 Disabled individual
The §72(m)(7) standard: unable to engage in any substantial gainful activity due to a medically determinable physical or mental impairment expected to be long-continued and of indefinite duration. The disability must exist at the date of death and is documented through Social Security disability rulings or physician certification. The IRS may require periodic substantiation.
4.2 Chronically ill individual
§7702B(c)(2): unable to perform at least 2 of 6 activities of daily living for at least 90 days, or has a similar level of disability per a licensed health-care practitioner. The certification must be in place at the date of death.
4.3 Minor child of the decedent
A minor child (not grandchild or other relative) of the decedent qualifies as an EDB until age 21. Distributions can use the Single Life Table over the child’s life expectancy. Once the child turns 21, the 10-year clock starts, and the account must be depleted by the year the beneficiary turns 31.
Trust structures naming a minor child often want to coordinate with the §529 or special-needs trust planning to manage the year-21 transition.
4.4 Beneficiary not more than 10 years younger than decedent
The “not more than 10 years younger” test compares the beneficiary’s and decedent’s dates of birth, not ages at death. A sibling 8 years younger qualifies as EDB; a sibling 11 years younger does not. This is the EDB category most often missed in estate-plan reviews.
5. SECURE 2.0 penalty changes
The §4974 excise tax on missed RMDs — including inherited-IRA RMDs — was reduced effective for tax years after 31 December 2022:
- 25% base penalty on the shortfall (down from 50%).
- 10% reduced penalty if corrected within a 2-year window.
- IRS will generally waive entirely for first-time reasonable-cause shortfalls.
For the 2021-2024 transition period, the IRS waived all penalties on missed inherited-IRA RMDs during the 10-year window pending the Final Regs. That waiver does not extend to 2025 and beyond — the new rules apply.
6. Roth IRA inherited under the 10-year rule
A non-spouse beneficiary of a Roth IRA owned by a decedent who died after 2019 is subject to the 10-year rule, but with two beneficiary-friendly twists:
- The Roth owner has no lifetime RMDs, so by definition the decedent never reached an RBD. The pre-RBD path applies: no annual RMDs in years 1-9, just full depletion by year 10.
- Distributions are fully tax-free if the original owner’s 5-year clock had elapsed before death. The clock starts the year of the original owner’s first Roth contribution and transfers to the beneficiary.
A 10-year tax-deferred Roth balance is often the most powerful planning lever in this category. The Roth Conversion Calculator helps quantify how much pre-RBD Roth conversion is worth before bequeathing.
7. Spousal beneficiary — three options
Spouses are not “designated” beneficiaries in the technical sense and have three options:
- Rollover (treat as own). Move the IRA into the spouse’s own name and RMD rules restart from the spouse’s RBD. Often the highest-value option when the surviving spouse is younger than the decedent.
- Inherited IRA (treat as beneficiary). Use the Single Life Table at the spouse’s age, recalculated each year (not subtract-one). Useful when the surviving spouse is significantly younger than the decedent and wants to delay RMDs.
- 5-year rule (if decedent died before RBD only). Empty the account within 5 years with no annual RMDs.
The choice is usually rollover unless the surviving spouse is under 59½ and may need penalty-free access — inherited-IRA distributions are exempt from the 10% early-withdrawal penalty.
8. Common mistakes with inherited IRAs
- Mixing inherited and owned IRAs in one account. Custodian must title the inherited IRA as “[Decedent], deceased, IRA FBO [Beneficiary]” — commingling restarts the 10-year clock or, worse, disqualifies the IRA.
- Doing a 60-day rollover with an inherited IRA. Non-spouse beneficiaries cannot do indirect rollovers — any distribution received in the beneficiary’s own name and not transferred trustee-to-trustee becomes a taxable distribution.
- Forgetting the year-of-death RMD. If the decedent died after their RBD and had not yet taken their full year-of-death RMD, the beneficiary must take the remainder by 31 December of the year of death.
- Naming a trust without a see-through provision. A non-see-through trust collapses to the 5-year or estate’s-remaining-life-expectancy default and loses the 10-year stretch.
- Missing the 2025 RMD restart. The 2021-2024 penalty waiver does not extend to 2025; beneficiaries of a post-RBD decedent must restart annual RMDs in 2025 and continue through year 9.