To calculate an inherited IRA RMD, divide the account’s fair market value on December 31 of the prior year by the life expectancy factor from IRS Publication 590-B’s Single Life Expectancy Table (Table I) for the age you will reach by the end of the current year. That is the arithmetic. The harder part is knowing whether you owe an annual RMD in the first place, because that answer depends on which beneficiary category you fall into and whether the person you inherited from had already started taking their own withdrawals before they died.
Figure Out Which Beneficiary Category You Are
Your category controls whether annual withdrawals are required, so settle this before you touch a calculator. Federal tax law puts inherited IRA beneficiaries into three groups.1eCFR. 26 CFR 1.401(a)(9)-4 – Determination of the Designated Beneficiary
Eligible designated beneficiaries get the most favorable treatment and can generally stretch distributions over their own life expectancy. You qualify if you are the surviving spouse, a minor child of the owner (under age 21 for this purpose), a disabled or chronically ill individual, or someone not more than 10 years younger than the deceased owner. A minor child loses this status at age 21, and the 10-year clock starts running on the remaining balance at that point.
Designated beneficiaries are most adult children, siblings, friends, and other individuals who don’t meet an eligible category. If you inherited in 2020 or later, you are subject to the 10-year rule.
Non-designated beneficiaries are entities such as estates, charities, and trusts that don’t qualify as see-through trusts. Their rules are different and are covered briefly at the end.
Do You Owe an Annual RMD, or Just the 10-Year Deadline?
For individual beneficiaries under the 10-year rule, the entire account has to be emptied by December 31 of the tenth year after the owner’s death.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs Whether you also owe an annual withdrawal in years one through nine depends on whether the original owner had reached their required beginning date (RBD) before dying.
The RBD is April 1 of the year after the owner turns 73. SECURE 2.0 will raise that threshold to age 75 for people who turn 74 after December 31, 2032.3Senate Committee on Finance. SECURE 2.0 Act of 2022 Section by Section Summary
If the owner died before their RBD, you have to empty the account by the end of year 10, but you owe no required annual withdrawals in between. Take money out on any schedule you want.
If the owner died on or after their RBD, you must take an annual distribution every year starting the year after death, and you still must empty the account by the end of year 10.
The IRS finalized these rules effective January 1, 2025.4Internal Revenue Service. Notice 2024-35 – Certain Required Minimum Distributions During 2021 through 2024, the IRS waived excise taxes for beneficiaries who missed annual distributions while the regulations were still being written. That relief is over. Starting in 2025, missed annual RMDs carry penalties.
One boundary worth naming: inherited Roth IRAs follow the same 10-year emptying deadline, but because Roth owners are never required to take lifetime distributions, they always die before their RBD by definition. Beneficiaries of an inherited Roth do not owe annual RMDs during the 10-year window, only the final emptying.5Internal Revenue Service. Retirement Topics – Beneficiary
Run the Calculation
Once you know an annual RMD is required, the math takes two numbers.
The Prior Year-End Balance
Your IRA custodian reports the December 31 fair market value on Form 5498, Box 5.6Internal Revenue Service. Instructions for Forms 1099-R and 5498 (2025) Form 5498 isn’t due to the IRS until the following June, so most custodians post the year-end balance on their website or year-end statements well before the form itself arrives.
Your Life Expectancy Factor
Look up the age you will reach by the end of the current year in the Single Life Expectancy Table (Table I) of IRS Publication 590-B.7Internal Revenue Service. Publication 590-B (2025) – Distributions from Individual Retirement Arrangements The table gives you a factor representing years of expected life.
Non-spouse beneficiaries look up the factor only once, in the first distribution year. Every year after that, subtract 1.0 from the prior year’s factor. If your first-year factor is 36.2, the next year it is 35.2, then 34.2, and so on. Surviving spouses recalculate each year using their actual current age, which usually produces a larger, more favorable factor.
The Formula
Divide the prior December 31 balance by the life expectancy factor.
Say you inherited a traditional IRA and will turn 50 by year-end. The account held $500,000 on December 31 of last year. Table I gives a factor of 36.2 for age 50.
$500,000 รท 36.2 = $13,812.15
That $13,812.15 is your minimum withdrawal for the year. Next year, you would use the new December 31 balance and a factor of 35.2. The calculation resets every year on the new balance. You can always take more than the minimum, but excess withdrawals do not reduce future years’ requirements.
Every annual RMD has to leave the account by December 31 of the applicable year.8Internal Revenue Service. Retirement Topics – Required Minimum Distributions (RMDs) There is no April 1 first-year grace period for beneficiaries the way there is for original owners. December 31 is the only deadline.
Don’t Forget the Year-of-Death RMD
If the original owner died in a year they owed an RMD but hadn’t taken it yet, you as the beneficiary have to complete that withdrawal by December 31 of the year of death.9Internal Revenue Service. Required Minimum Distributions for IRA Beneficiaries If your parent died in August 2025 without having taken their 2025 RMD, you need to withdraw it by December 31, 2025. This year-of-death amount is calculated using the deceased owner’s own RMD figure, not yours, and it is separate from your first beneficiary RMD, which begins the following year.
Account titling matters too. The inherited IRA must show both the deceased owner’s name and your name as beneficiary, in a format like “John Smith, Deceased, IRA FBO Jane Smith, Beneficiary.” If you roll the account into a new IRA under only your name and you are not a spouse electing to treat it as your own, the IRS can treat the whole balance as a taxable distribution.
If You Inherited More Than One IRA
If you inherited multiple IRAs from the same person, you calculate the RMD for each account separately. You can then add the amounts and withdraw the total from just one of the inherited IRAs, provided both are the same type (two inherited traditional IRAs from the same decedent, for example).
You cannot combine an inherited IRA with an inherited 401(k) or other workplace plan, and you cannot aggregate an inherited IRA with an IRA you own yourself. Each account type stays in its own lane.
What Happens If You Miss an RMD
If you withdraw less than required, the IRS charges a 25% excise tax on the shortfall.8Internal Revenue Service. Retirement Topics – Required Minimum Distributions (RMDs) That drops to 10% if you correct the shortfall within two years.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs
To correct a missed RMD, actually take the distribution and file Form 5329 with the tax return for the year you should have taken it. If the shortfall was due to a reasonable mistake and you are taking steps to fix it, you can ask the IRS to waive the penalty entirely. Attach a written explanation to Form 5329, enter “RC” and the shortfall amount on the dotted line next to line 54, and complete the rest of the form as directed.10Internal Revenue Service. Instructions for Form 5329 (2025) The IRS reviews each waiver request and will notify you if it is denied.
If you inherited an IRA between 2020 and 2024 and skipped annual distributions during the transition-relief window, look carefully at where the account stands now. You still have to empty it by the end of the 10-year window, and spreading the remaining balance across the years left usually beats taking a large taxable amount in the final year.
Non-Individual Beneficiaries Follow Different Rules
If an estate, charity, or non-qualifying trust inherited the IRA, the 10-year rule does not apply because it covers only individual beneficiaries. Non-individual beneficiaries use the older pre-2020 rules: if the owner died before their RBD, the account must be fully distributed by December 31 of the fifth year after death; if the owner died on or after their RBD, distributions are taken over the deceased owner’s remaining life expectancy calculated as if they were still alive.5Internal Revenue Service. Retirement Topics – Beneficiary The 5-year rule can compress a lot of taxable income into a short window on large accounts, so if you’re settling an estate that inherited an IRA, get advice quickly. The clock runs whether anyone is watching or not.