Roth IRAs have no required minimum distributions during the original owner’s lifetime, and since 2024 the same is true for Roth accounts inside 401(k), 403(b), and 457(b) plans. RMD rules do apply once the owner dies: most people who inherit a Roth account must withdraw the entire balance within 10 years, while surviving spouses and a small group of other beneficiaries get more flexibility.
No Lifetime RMDs for the Original Owner
Federal tax law carves Roth IRAs out of the rules that force annual withdrawals from other retirement accounts. The statute governing Roth IRAs says the normal distribution schedule that applies to traditional IRAs does not apply while the original owner is alive.1Office of the Law Revision Counsel. 26 USC 408A – Roth IRAs You could live to 100 with a $3 million Roth IRA and never be required to take a dollar.
The reason is simple. Roth contributions go in after tax, so the government has no deferred tax revenue waiting to be collected. Traditional IRAs work the opposite way, which is why traditional IRA owners must start taking RMDs at age 73 under current rules, with that threshold rising to 75 for people born in 1960 or later.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs
Because you are never forced to draw the balance down, the account can compound tax-free for decades. Retirees who cover their living expenses from other sources often leave Roth IRAs untouched specifically to pass the largest possible balance to heirs.
Roth 401(k) and Other Workplace Roth Accounts
Roth balances inside 401(k), 403(b), and 457(b) plans are called designated Roth accounts. For years these accounts were treated differently from Roth IRAs even though they held after-tax money. Participants had to take RMDs from them on the same schedule as their pre-tax balance, or roll the Roth portion into a Roth IRA before hitting the required beginning age.
SECURE 2.0 fixed that. Starting with the 2024 tax year, designated Roth accounts are no longer subject to lifetime RMDs.3Federal Register. Required Minimum Distributions The IRS now treats workplace Roth balances the same as Roth IRAs while the owner is alive.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs You can leave the balance in your employer plan indefinitely without a forced-withdrawal deadline pushing you toward a rollover.
What Changes When the Owner Dies
The lifetime exemption ends at death. Once a Roth owner passes away, distribution rules kick in for whoever inherits the account, and those rules depend on the beneficiary’s relationship to the deceased.
The 10-Year Rule for Most Beneficiaries
Adult children, grandchildren, friends, and other non-spouse beneficiaries who do not qualify for an exception must withdraw the entire inherited Roth balance by December 31 of the tenth year after the original owner’s death.4Internal Revenue Service. Retirement Topics – Beneficiary This rule came from the SECURE Act of 2019, which eliminated the old stretch-IRA strategy that let non-spouse beneficiaries take small distributions over their own life expectancy.
For inherited Roth accounts specifically, no annual withdrawals are required inside that 10-year window. You can leave the money invested for the full decade and take a single lump withdrawal at the end, or spread distributions out in any pattern you like. The IRS final regulations confirm that because Roth IRA owners are always treated as dying before their required beginning date, the 10-year rule imposes only an end-of-window deadline, not annual minimums.3Federal Register. Required Minimum Distributions
That flexibility is a real advantage. Beneficiaries who inherit a traditional IRA from someone who died after their required beginning date face annual RMDs during the 10-year window. Roth beneficiaries skip that layer entirely.
Surviving Spouse Options
Surviving spouses have the widest range of choices. The most powerful option is rolling the inherited Roth into their own Roth IRA or electing to treat it as their own.4Internal Revenue Service. Retirement Topics – Beneficiary This resets the account to no-lifetime-RMD status, as if the surviving spouse had always owned it. The money can continue growing tax-free for the rest of that spouse’s life.
A surviving spouse can also keep the account as an inherited Roth IRA and take distributions based on their own life expectancy, use the 10-year rule, or delay distributions until the deceased would have reached RMD age. For younger spouses who do not need the money soon, rolling the balance into their own Roth IRA is usually the strongest move.
Eligible Designated Beneficiaries
A narrow group qualifies for more favorable treatment than the standard 10-year depletion. Federal tax law defines five categories of eligible designated beneficiaries who can take distributions over their own life expectancy instead:5Legal Information Institute. 26 USC 401(a)(9) – Required Distributions
- Surviving spouses, who also have the rollover option described above.
- Disabled individuals who meet the disability definition under federal tax law.
- Chronically ill individuals with a certification of an indefinite, lengthy inability to perform daily activities.
- Individuals not more than 10 years younger than the deceased, such as a sibling close in age.
- Minor children of the deceased owner, until they turn 21, after which the 10-year clock starts.
Beneficiaries in these categories who choose the life-expectancy method calculate annual distributions using the IRS Single Life Expectancy Table. They can also elect the 10-year rule instead if that fits their situation better. One boundary worth noting: grandchildren, nieces, nephews, and stepchildren who are not legally adopted do not qualify as minor-child beneficiaries and fall under the standard 10-year rule from the start, regardless of their age.
The Five-Year Rule for Tax-Free Earnings
Inheriting a Roth account does not automatically mean every dollar comes out tax-free. Withdrawals of earnings from an inherited Roth IRA are subject to income tax if the account was less than five years old at the time of the withdrawal.4Internal Revenue Service. Retirement Topics – Beneficiary This catches beneficiaries off guard more often than you would expect.
The five-year clock starts on January 1 of the tax year the original owner first contributed to any Roth IRA. If the owner opened their first Roth IRA in March 2023, the clock started on January 1, 2023, and the five-year period ends on January 1, 2028. The beneficiary inherits whatever time remains. Only the earnings portion is affected. Original contributions and conversion amounts always come out tax-free regardless of timing, because they went in with after-tax dollars.
Designated Roth accounts inside employer plans have a separate five-year clock that starts on the first day of the tax year the employee first made Roth contributions to that specific plan.6Internal Revenue Service. Retirement Plans FAQs on Designated Roth Accounts If the original owner rolled a designated Roth account into a Roth IRA, the time spent in the employer plan does not count toward the Roth IRA’s five-year period. Verify which clock applies before withdrawing earnings.
The Penalty for Missing an Inherited Deadline
Beneficiaries who inherit Roth accounts are not exempt from the RMD penalty. Missing a required distribution triggers an excise tax equal to 25% of the shortfall between what you should have withdrawn and what you actually took.7Office of the Law Revision Counsel. 26 USC 4974 – Excise Tax on Certain Accumulations in Qualified Retirement Plans Before 2023, that penalty was 50%.
The tax drops to 10% if you fix the mistake within the correction window, which generally runs through the end of the second tax year after the year the penalty applies.7Office of the Law Revision Counsel. 26 USC 4974 – Excise Tax on Certain Accumulations in Qualified Retirement Plans Correcting means withdrawing the shortfall amount and filing the appropriate return. The window closes earlier if the IRS sends a notice of deficiency or assesses the tax before that two-year mark.
The most common way beneficiaries hit this penalty is by forgetting the 10-year deadline entirely. Someone who inherits a Roth IRA in 2024 and ignores it until 2035 would owe 25% of whatever balance remained at the end of 2034. On a $500,000 inherited Roth, that is a $125,000 penalty on money that should have come out tax-free. A calendar reminder for the ninth year after the owner’s death is one of the cheapest pieces of planning available.