How Do You Calculate RMDs on an Inherited IRA? (w/Examples) + FAQs

This article reflects federal rules and general state rules as of June 2026 and covers tax year 2025 (with notes for the 2026 season). Tax law changes — confirm current figures before you file.

Quick Answer

Divide the inherited IRA’s December 31 prior-year balance by your life-expectancy factor from the IRS Single Life Expectancy Table. For most non-spouse heirs under the 10-year rule whose loved one died on or after their RMD age, annual RMDs restart in 2025. Miss one and the penalty is up to 25%.

The hardest part is not the math — it is figuring out which set of rules applies to you, because the answer changes based on who died, when they died, and your relationship to them. If you inherited an IRA from a parent who was already taking distributions and you skip your 2025 withdrawal, the IRS can hit the shortfall with a 25% excise tax under Internal Revenue Code Section 4974.

This matters more in 2025 than in any year since the SECURE Act passed. The IRS waived missed-RMD penalties for 2021 through 2024 while it finalized the rules, so 2025 is the first year many beneficiaries actually owe an annual distribution — and CNBC reports the change could trigger a penalty before year-end for heirs who do not realize the grace period ended.

Here is what you will learn:

📋 How to calculate your exact RMD with the right table and divisor
🧮 Three fully worked examples with real dollar figures you can copy
⏰ Which beneficiaries owe annual RMDs in 2025 and which do not
🛡️ How to fix a missed RMD and cut the penalty from 25% to 10%
💡 The traps that turn an inheritance into a surprise tax bomb

What an Inherited IRA RMD Actually Is

An inherited IRA is the account you receive when an IRA owner dies and names you as beneficiary. A required minimum distribution, or RMD, is the minimum amount the law forces you to pull out of that account in a given year. The IRS sets RMDs so retirement money does not stay tax-sheltered forever.

For inherited accounts, the RMD rules split into two big questions. First, must you empty the whole account within a set number of years? Second, must you also take a yearly withdrawal along the way? These are separate requirements, and confusing them is the single most common mistake heirs make.

The reason this got complicated is the SECURE Act of 2019. For deaths before 2020, most beneficiaries could “stretch” distributions over their own life expectancy, sometimes for decades. For deaths on or after January 1, 2020, Congress replaced the stretch for most heirs with a 10-year deadline. The final IRS regulations, released in 2024 and effective in 2025, then settled a long fight over whether yearly RMDs are also required inside that 10-year window.

The consequence of getting this wrong is real money. If you owe an annual RMD and skip it, the excise tax is 25% of what you should have taken. If you wrongly believe you owe nothing and let the full balance ride to year 10, you can face a giant taxable lump sum that pushes you into a higher bracket. What you should do first is identify your beneficiary category — the next section walks you through it.

Which Situation Applies to You?

The rules branch by who you are to the person who died and when they died. Find your row below, then read the matching section.

You are the surviving spouse → You have the most options, including rolling the money into your own IRA. See Surviving Spouse Options.
You are an eligible designated beneficiary (EDB) — a minor child of the owner, a disabled or chronically ill person, or someone not more than 10 years younger than the owner → You can often still stretch over your life expectancy. See Eligible Designated Beneficiaries.
You are any other individual — an adult child, grandchild, sibling, friend → You fall under the 10-year rule. See The 10-Year Rule.
The beneficiary is an estate, charity, or non-qualifying trust → You face the 5-year rule or the owner’s remaining life expectancy. See Non-Person Beneficiaries.

Within those categories, one more fact decides whether you owe annual RMDs: did the owner die before or after their required beginning date (RBD)? The RBD is April 1 of the year after the owner turned RMD age — age 73 for people reaching that age in 2023 through 2032, rising to 75 in 2033. If the owner died on or after their RBD, they had already “turned on” RMDs, and most heirs must keep them flowing. If the owner died before the RBD, the annual-RMD requirement usually does not apply, though the account-emptying deadline still does.

This is why two heirs who inherited identical $400,000 IRAs can owe completely different amounts. The whole answer hinges on these two facts, so confirm them before you touch the math.

The 10-Year Rule, Explained in Plain English

The 10-year rule says a non-eligible designated beneficiary must fully empty the inherited IRA by December 31 of the tenth year after the owner’s death. If your father died in 2025, your deadline is December 31, 2035. The account does not have to be drained evenly — only emptied by the end.

The twist the 2024 regulations confirmed is the “at least as rapidly” rule. If the owner had already started RMDs (died on or after their RBD), you must also take an annual RMD in years one through nine, then clean out whatever is left by year 10. Ed Slott explains that the yearly amount is based on your own life expectancy, not the deceased’s. If the owner died before their RBD, you skip the annual RMDs and only face the year-10 deadline.

The consequence of missing an annual RMD is the 25% excise tax on the shortfall. The consequence of missing the year-10 deadline is worse: the entire remaining balance becomes a taxable distribution at once, plus a possible penalty. A common misconception is that the 10-year rule lets you wait until year 10 to do anything — for many heirs in 2025, that is now false and expensive.

What you should do: confirm the date of death and whether the owner was past their RBD, then mark both your annual-RMD deadline (December 31 each year) and your final year-10 deadline on a calendar.

Does the 10-Year Rule Apply to Roth IRAs?

Yes. An inherited Roth IRA is also subject to the 10-year rule for non-eligible designated beneficiaries — Suze Orman confirms the account must be emptied within 10 years, just like a traditional one. The key difference is the annual requirement.

Because the original Roth owner is always treated as dying before their RBD (Roth owners never have lifetime RMDs), inherited Roth IRAs do not require yearly RMDs in years one through nine. You only face the year-10 emptying deadline. And the withdrawals are generally tax-free, as long as the account met the five-year holding rule. Still, leaving it untouched for the full decade is often smart, since the money keeps growing tax-free until the final deadline.

How to Calculate the RMD: The Formula

The core formula is simple. The hard part is picking the right balance and the right divisor.

The formula is: RMD = prior-year December 31 account balance ÷ life-expectancy factor. Snowbird Wealth Management lays out the two steps — find your factor on the IRS Single Life Expectancy Table, then divide.

For your first RMD year, you find your age on the Single Life Expectancy Table in IRS Publication 590-B based on your age in the year after the owner’s death. That gives your starting factor. Then in each following year, you do not look the table up again — you simply subtract 1 from the prior year’s factor. This is the “fixed-term” or “subtract-one” method that applies to most non-spouse beneficiaries.

The consequence of using the wrong table is a wrong RMD. Beneficiaries use the Single Life Expectancy Table; account owners taking their own lifetime RMDs use the Uniform Lifetime Table — the Fidelity table itself warns it does not apply to inherited IRAs. What you should do: pull your December 31, 2024 balance for a 2025 RMD, find your single-life factor, and keep a running record so you can subtract 1 each year.

Three Worked Examples (w/Real Dollars)

Below are three fully worked calculations. Copy the math for your own numbers.

Example 1: Adult Child, Owner Died After RBD

David, age 52 in 2025, inherited a $500,000 traditional IRA from his mother, who died in 2024 at age 80 — well past her RBD. David is a non-eligible designated beneficiary, so he owes annual RMDs and must empty the account by 2034.

His mother’s December 31, 2024 balance was $500,000. David’s age in 2025 (the year after death) is 52. The Single Life Expectancy factor for age 52 is 34.3. His 2025 RMD is $500,000 ÷ 34.3 = $14,577. He must withdraw at least that by December 31, 2025, and it is taxed as ordinary income. In 2026, he does not re-check the table — he uses 34.3 − 1 = 33.3 against his new December 31, 2025 balance.

Example 2: Adult Child, Owner Died Before RBD

Maria, age 45, inherited a $300,000 traditional IRA from her father, who died in 2025 at age 60 — before his RBD. Maria is also a non-eligible designated beneficiary.

Because her father had not started RMDs, Maria owes no annual RMD in years one through nine. Her only hard requirement is to empty the entire $300,000 (plus growth) by December 31, 2035. She can take $0 for nine years and a lump sum in year 10 — but spreading withdrawals out usually lowers her lifetime tax. If she pulls roughly $35,000 a year instead, she avoids a single massive taxable spike.

Example 3: Inherited Roth IRA

Linda, age 58, inherited a $250,000 Roth IRA from her aunt, who died in 2025. The Roth had been open more than five years.

Linda follows the 10-year rule, so the account must be emptied by December 31, 2035. But because Roth owners are always treated as dying before their RBD, Linda owes no annual RMDs. Her qualified withdrawals are entirely tax-free. The smart move is to leave the full $250,000 invested and growing tax-free until late 2035, then withdraw it all with no tax bill.

Surviving Spouse Options

A surviving spouse has the most flexibility of any beneficiary, and the rules are far kinder. You generally have three paths.

First, you can roll the IRA into your own IRA (or treat it as your own). The account then follows your age and schedule, and you do not start RMDs until you reach age 73, per Spencer Fane. The catch: if you are under 59½, withdrawals before then can trigger the 10% early-withdrawal penalty.

Second, you can keep it as an inherited IRA. If your spouse died before their RBD, Vanguard notes you can wait to start RMDs until the later of December 31 of the year after death or the year your spouse would have reached RMD age — then RMDs use your own life expectancy. Third, you can take a lump sum or, in some cases, the 10-year rule.

Here is why this matters: a 60-year-old widow inheriting her 75-year-old husband’s IRA can roll it over and defer RMDs for 13 years, maximizing tax-deferred growth. What you should do: if you are over 59½ and do not need the money soon, the spousal rollover is usually the best move; if you are under 59½ and need access, keeping it as an inherited IRA avoids the early-withdrawal penalty.

Eligible Designated Beneficiaries (EDBs)

EDBs are a special class that escapes the 10-year rule and can still “stretch” distributions. Ameritas lists four types beyond surviving spouses: a minor child of the owner, a disabled individual, a chronically ill individual, and a beneficiary not more than 10 years younger than the owner.

An EDB may take annual RMDs over their own life expectancy, stretching the account for many years. There is one important wrinkle for minor children: the stretch lasts only until the child reaches age 21. At 21, the 10-year clock starts, and the account must be emptied by the time the child turns 31.

The consequence of misclassifying yourself is large. If you assume you are an EDB but you are not, you may under-withdraw and face the 25% penalty, or over-extend the account past your legal deadline. What you should do: confirm your status — disability and chronic illness require specific IRS definitions and documentation — and keep proof in your records.

Non-Person Beneficiaries: Estates, Charities, and Trusts

When an IRA passes to a non-person — an estate, a charity, or a trust that does not qualify as a “see-through” trust — there is no human life expectancy to use, so the rules are harsher.

If the owner died before their RBD, the account generally must be emptied under the 5-year rule — fully distributed by December 31 of the fifth year after death. If the owner died on or after their RBD, the account is paid out over the owner’s remaining single-life expectancy, which is often a short window for someone who died in their 80s.

The consequence is compressed taxation. A trust or estate often pays tax at the top bracket far faster than an individual would. What you should do: if an IRA names a trust or estate, have an estate attorney review whether the trust qualifies as a see-through trust, which can sometimes restore a more favorable payout — this is exactly the kind of situation that warrants a professional.

The 3 Most Common Scenarios

Each table below shows a situation and what it triggers.

Scenario A: Adult Child Inherits From a Parent Over 73

Your situation	What it triggers
Parent died after their required beginning date	Annual RMDs in years 1–9 using your single-life factor
You are a non-eligible designated beneficiary	Full account must be emptied by December 31 of year 10
You skipped your 2025 RMD	Up to a 25% excise tax on the shortfall, reduced to 10% if fixed timely

Scenario B: Adult Child Inherits From a Parent Under 73

Your situation	What it triggers
Parent died before their required beginning date	No annual RMD required in years 1–9
You are a non-eligible designated beneficiary	Full account must still be emptied by December 31 of year 10
You wait until year 10 to withdraw everything	One large taxable lump sum that may spike your tax bracket

Scenario C: You Inherit a Roth IRA

Your situation	What it triggers
Roth owner is always treated as pre-RBD	No annual RMDs in years 1–9
10-year rule still applies	Account must be emptied by December 31 of year 10
Account was open at least five years	Withdrawals are fully income-tax-free

Deadlines, Costs, and Timing

Timing drives everything with inherited IRAs. The annual RMD deadline is December 31 of each year. The first annual RMD for affected 10-year-rule beneficiaries is due by December 31, 2025. The year-10 final deadline is December 31 of the tenth year after death.

There is also a year-of-death RMD. If the owner was due an RMD in the year they died and had not taken it, the beneficiary must take that amount by December 31 of the death year. Miss it and the same excise tax applies.

Costs vary by path. Doing the calculation yourself is free — it is one division problem. A CPA or financial advisor typically charges a few hundred dollars to confirm your category and run the numbers, which is cheap insurance against a 25% penalty on a large account. For trusts, estates, or blended families, an estate attorney’s review can run higher but prevents far costlier mistakes.

Mistakes to Avoid

Using the Uniform Lifetime Table instead of the Single Life Expectancy Table. This inflates or shrinks your divisor and produces a wrong RMD that can trigger a penalty.
Re-looking-up the table every year. Most beneficiaries must subtract 1 from the prior factor; re-reading the table gives the wrong number.
Assuming the 10-year rule means no yearly withdrawals. If the owner died after their RBD, skipping years 1–9 RMDs triggers the 25% excise tax.
Forgetting the year-of-death RMD. If the deceased had not taken their own RMD that year, you owe it — missing it is penalized.
Letting everything ride to year 10. A lump-sum withdrawal can push you into a much higher bracket and cost thousands in extra tax.
Missing the December 31 deadline. RMD deadlines are calendar-year-end, not April 15 — a missed date is an automatic shortfall.
Mixing inherited IRAs from different people. You cannot aggregate RMDs across IRAs inherited from different decedents; each is calculated separately.
Not filing Form 5329 after a miss. Failing to report and request a waiver leaves the full 25% penalty in place.

Do’s and Don’ts

Do: – Do confirm whether the owner died before or after their RBD — it decides whether you owe annual RMDs at all. – Do take your 2025 RMD if you are affected — the IRS grace period for 2021–2024 ended, so 2025 is live. – Do keep a running log of your divisor — you subtract 1 each year, and errors compound. – Do consider spreading withdrawals — even when not required, smoothing income lowers lifetime tax. – Do consult a pro for trusts or estates — non-person beneficiary rules are unforgiving.

Don’ts: – Don’t co-mingle inherited IRA money with your own IRA (unless you are a spouse rolling it over) — it can disqualify the account. – Don’t assume Roth means no rules — inherited Roths still must be emptied within 10 years. – Don’t ignore the year-10 deadline — the leftover balance becomes fully taxable at once. – Don’t guess your beneficiary category — misclassification drives most penalties. – Don’t skip Form 5329 if you miss an RMD — it is your path to a reduced or waived penalty.

Pros and Cons of the 10-Year Rule

Pros: – Flexibility within the window — when no annual RMD applies, you control the timing of withdrawals. – Tax planning room — you can withdraw more in low-income years to manage your bracket. – Continued tax-deferred growth — money left inside keeps compounding for up to a decade. – Roth advantage — inherited Roths grow tax-free for the full 10 years with no annual draw. – No lifetime stretch tracking — a fixed deadline is simpler than decades of life-expectancy math.

Cons: – Compressed taxation — a large traditional IRA emptied in 10 years can mean steep tax bills. – Annual RMD trap — many heirs owe yearly withdrawals they did not expect starting in 2025. – Bracket creep risk — large withdrawals can push you into higher brackets or raise Medicare premiums. – Lost stretch — heirs no longer get the decades-long deferral available before 2020. – Penalty exposure — the 25% excise tax on missed RMDs is severe.

Federal vs. State: Does Your State Tax This?

Federal law sets the RMD requirement and the penalty. Your state sets whether the distribution itself is taxed as income. These are separate, and the rules genuinely vary.

Most states with an income tax treat traditional inherited IRA withdrawals as taxable income, the same way the IRS does, though some offer retirement-income exclusions. States with no income tax — such as Florida, Texas, Tennessee, Nevada, Washington, Wyoming, South Dakota, and Alaska — do not tax the distribution at the state level at all. A handful of states, like Pennsylvania, treat retirement distributions more favorably.

Critically, the federal 25% excise tax for a missed RMD is a federal penalty; states do not impose their own version of it. What you should do: check your state revenue department’s rules on retirement-income taxation before you take a large withdrawal, because the state hit can change your timing strategy. This article covers federal rules and general state treatment — it is educational and not a substitute for advice from a licensed CPA, tax attorney, or estate attorney for your specific situation.

How to Fix a Missed RMD

If you missed an RMD, act fast — the fix is well-established and usually forgiving. There are four steps, per Greenbush Financial Group.

First, withdraw the missed amount immediately from the inherited IRA. Second, file IRS Form 5329 with your federal return to report the shortfall and request relief. Third, attach a short explanation of why you missed it and confirm you have corrected it. Fourth, calculate the penalty — it is 25% of the shortfall under SECURE 2.0 Section 302, but drops to 10% if you correct the shortfall and file within the two-year correction window.

The IRS often waives the penalty entirely for reasonable cause when you have fixed the shortfall. What you should do: do not wait for the IRS to notice — self-correct, file Form 5329, and document everything. This is exactly where a CPA earns their fee on a large account.

What to Do Next

Confirm two facts: the owner’s date of death and whether they died before or after their required beginning date.
Identify your beneficiary category — spouse, EDB, non-eligible designated beneficiary, or non-person — using the decision aid above.
Pull the December 31 prior-year balance for the account.
Find your factor on the Single Life Expectancy Table and calculate your 2025 RMD, if you owe one.
Withdraw at least the RMD by December 31, 2025 and set a recurring annual reminder, plus your year-10 deadline.
If you missed a prior RMD, withdraw it now and file Form 5329.
Call a CPA or estate attorney if a trust, estate, or blended family is involved, or if the account is large.

Frequently Asked Questions

Do I have to take an RMD from an inherited IRA in 2025? Maybe. If you are a non-eligible designated beneficiary and the owner died on or after their required beginning date, yes — annual RMDs restart in 2025. If the owner died before their RBD, you only face the year-10 deadline.

What table do I use for an inherited IRA RMD? The IRS Single Life Expectancy Table in Publication 590-B. Find your factor in the first RMD year, then subtract 1 each following year. Account owners use the Uniform Lifetime Table instead.

Does the 10-year rule apply to inherited Roth IRAs? Yes. Inherited Roth IRAs must be emptied within 10 years. But because Roth owners are treated as dying before their RBD, there are no required annual withdrawals in years one through nine.

What is the penalty for missing an inherited IRA RMD? Up to 25% of the amount you failed to withdraw, under IRC Section 4974. It drops to 10% if you correct the shortfall and file Form 5329 within the two-year correction window.

Can I wait until year 10 to take everything out? Only sometimes. If no annual RMD applies, yes — but you risk a large taxable lump sum. If the owner died after their RBD, you must take annual RMDs in years one through nine.

How is the RMD calculated? Prior-year December 31 balance divided by your life-expectancy factor. For example, a $500,000 balance and a factor of 34.3 produces a $14,577 RMD for that year.

Do surviving spouses have to follow the 10-year rule? No. Spouses can roll the IRA into their own account and use their own age and schedule, or keep it as an inherited IRA. They have the most flexible options of any beneficiary.

What is the required beginning date (RBD)? April 1 of the year after the owner turns RMD age — age 73 for those reaching it in 2023 through 2032, rising to 75 in 2033. Whether the owner died before or after their RBD drives the rules.

Do I owe a year-of-death RMD? Yes, if the owner had not taken theirs. If the deceased owed an RMD in the year of death and skipped it, you must take that amount by December 31 of the death year.

Are inherited IRA withdrawals taxed by my state? It depends. States with no income tax do not tax them; most other states tax traditional IRA withdrawals as income, though some offer retirement exclusions. Check your state revenue agency.

Can I combine RMDs from IRAs I inherited from different people? No. You must calculate and take a separate RMD from each inherited IRA when the accounts came from different decedents. They cannot be aggregated.

Was the inherited IRA RMD penalty really waived for past years? Yes. The IRS waived missed annual-RMD penalties for 2021 through 2024 while it finalized the rules. That grace period ended, so 2025 is the first year the penalty is enforced.

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