Someone who inherits an IRA from a parent, sibling, friend or anyone else who is not their spouse generally has to empty the account by Dec. 31 of the 10th year after the owner’s death. The IRS spells out the deadline in Publication 590-B: the whole balance must come out “by December 31 of the year containing the 10th anniversary of the owner’s death.” An owner who died in 2025 sets a deadline of Dec. 31, 2035.
The rule covers a “designated beneficiary who is not an eligible designated beneficiary,” the publication says, and it applies “regardless of whether the owner died before reaching their required beginning date.” The required beginning date is the point when the owner would have had to start taking yearly withdrawals. Deaths in 2019 or earlier fall under older rules.
For most adult children, nieces, nephews and friends who are named on an IRA, the 10-year clock is the one that counts. The harder question is whether anything has to come out along the way, and the answer turns on whether the owner had already started required withdrawals when they died.
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Does the money have to come out every year?
It depends on the owner. The IRS says that when the owner died before the required beginning date, “no distribution is required for any year before the 10th year,” so an heir can wait and take everything at the end or spread it out.
When the owner had already started required withdrawals, the Treasury Department and the IRS take a stricter view. Final regulations published July 19, 2024 in the Federal Register “generally require annual distributions to continue while also requiring full distribution” by the end of the year that includes the 10th anniversary of the owner’s death.
When did the yearly withdrawals start counting?
The final regulations “apply for purposes of determining required minimum distributions for calendar years beginning on or after January 1, 2025,” according to the preamble. The same document points to three IRS notices, 2022-53, 2023-54 and 2024-35, that gave transition relief for 2021 through 2024, so a plan did not fail to qualify for skipping those distributions.
The relief covered 2021 through 2024, and the regulations apply from 2025 on. A missed annual amount can carry an excise tax. The IRS says on its required minimum distribution page that the amount not withdrawn may be taxed at 25%, or 10% if the shortfall is corrected within two years.
Which heirs are not on the 10-year clock?
The IRS carves out a group it calls eligible designated beneficiaries. Publication 590-B lists “the owner’s surviving spouse, the owner’s minor child, a disabled individual, a chronically ill individual,” and “any other individual who is not more than 10 years younger than the IRA owner.” Those heirs can have other options, including spreading withdrawals over their own life expectancy in some cases.
The IRS RMD page lists the same exceptions, naming a surviving spouse, a child who has not reached the age of majority, a disabled or chronically ill person, and a person not more than 10 years younger than the owner. A surviving spouse is the group with the most room, because a spouse can treat the IRA as their own.
How does a spouse get out of the 10-year clock?
The same publication gives a surviving spouse two choices: treat the IRA as their own, by naming themselves as the account owner or rolling it over, or stay on as the beneficiary. A spouse who is the sole beneficiary of an owner who died before the required beginning date “isn’t required to begin receiving minimum distributions until the end of the year” the owner would have reached that date.
No heir on the 10-year rule gets that choice. A child, a grandchild or a friend who inherits the account is held to the Dec. 31 cutoff for the 10th year, and the owner’s required beginning date only decides whether the years before it also require withdrawals.
What if there is no person named?
A different clock applies when an estate or a trust is named as beneficiary instead of a person. Publication 590-B says that where the owner died before the required beginning date and the five-year rule applies, the entire balance has to come out by Dec. 31 of the year that contains the fifth anniversary of the death. A shorter window and a faster tax bill are the result.
The deadline is also separate from the rule that applies to the owner. An IRA owner has to start withdrawals at 73. An heir has no such age test and follows the death date. Anyone who inherited an IRA, and is not sure whether the owner had started withdrawals, can ask the custodian for the owner’s required beginning date, since that one date decides whether years one through nine require withdrawals.
The excise tax in the publication applies to any amount still in the account after the 10th-year deadline passes. The IRS says a beneficiary who does not take a required distribution “may have to pay an excise tax for that year on the amount not distributed as required.”
Is an inherited IRA on the 10-year clock in your family?
An heir who misses a yearly withdrawal, or the final Dec. 31 deadline, can owe an excise tax on the amount not taken, on top of the income tax on what comes out.
The Pass It On Checklist covers the inherited-IRA rules your heirs will face, including the 10-year rule, and it checks every beneficiary form with a primary and a backup named. It is 11 pages of ten moves, from a 60-second scan to a worksheet for a beneficiary audit.
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This article was produced with AI assistance and edited for accuracy against the sources linked above.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
