Inherited Roth IRA RMDs

Roth IRA original owners never have lifetime RMDs. For inherited Roths, RMDs depend on beneficiary type: non-spouse 10-year-rule beneficiaries have no annual RMDs in years 1–9 (per TD 10001, July 2024) — only the year-10 zero-balance deadline. Eligible Designated Beneficiaries on the life-expectancy method take annual RMDs; surviving spouses treating the Roth as their own take none. Missed RMDs trigger a 25% excise under IRC §4974.

Original Owners vs. Beneficiaries: The Starting Point

Roth IRA owners have a unique advantage: no required minimum distributions during their lifetime. The Roth can grow tax-free forever without a forced withdrawal—that's straight from IRC §408A(c)(5). A traditional IRA owner, by contrast, must start RMDs at age 73 (75 starting in 2033 under SECURE 2.0).

When the Roth owner dies, that lifetime exemption ends. What comes next depends entirely on which bucket of beneficiary you are. And here's the rule that most online guidance misses: because a Roth owner has no required beginning date during life, the final regulations treat every Roth owner as having died before their RBD. That one fact reshapes the entire RMD picture for inherited Roths.

Year-of-Death RMD: Nothing Is Due for Roth Owners

This is one of the most common questions beneficiaries ask in the weeks after a death — and the answer is different for Roth than for traditional. For a traditional IRA, if the owner died on or after their required beginning date without taking that year's RMD, the beneficiary must take the missed year-of-death RMD by December 31 of the death year (or, under recent IRS relief, within the automatic waiver window). It's a real deadline that can trigger excise tax if missed.

For an inherited Roth, that deadline doesn't exist. The owner had no lifetime RMD obligation, so there's no unsatisfied year-of-death distribution waiting for the beneficiary to clean up. Treas. Reg. §1.408A-6, A-14(b) makes this explicit: a Roth owner is treated as having died before their RBD, and IRC §408A(c)(5) confirms Roth owners are exempt from lifetime RMDs.

What this means in practice. If you inherit a Roth on April 14, 2026, you owe exactly nothing by December 31, 2026. Your first deadline (if any) is driven by your beneficiary category — the year-10 zero-balance deadline for non-EDBs, or the year-following-death start of life-expectancy distributions for EDBs. But the year-of-death scramble that traditional beneficiaries face? It simply doesn't exist for Roth beneficiaries.

One exception worth noting: if the decedent owned both a Roth IRA and a traditional IRA at death, the traditional IRA still has its year-of-death RMD obligation even though the Roth does not. Check the inventory of accounts carefully before concluding nothing is due.

Aggregating RMDs From Multiple Inherited Roths

If the same decedent left you more than one Roth IRA — say, two at different custodians — the RMD rules let you aggregate the required distribution. Under Treas. Reg. §1.408-8, A-9, when you're required to take an annual RMD from an inherited Roth (as an EDB on life expectancy), you calculate the required amount for each inherited Roth separately, sum them, and then satisfy the total by taking distributions from any one of the accounts or any combination. You don't have to pull a proportional slice from each.

The critical limitation. Aggregation is only allowed across inherited IRAs from the same decedent of the same account type. Inherited Roths from different decedents cannot be aggregated with each other. Inherited Roths cannot be aggregated with inherited traditional IRAs even from the same decedent. And — critically — inherited Roths cannot be aggregated with your own Roth IRA for RMD purposes. Each decedent's inherited Roths live in their own aggregation bucket.

Why it matters. If one of the inherited Roths holds illiquid assets (concentrated stock, real estate in a self-directed IRA), aggregation lets you satisfy the combined RMD from the liquid account without forcing a sale. It also simplifies cash flow: pick your highest-yielding position or your biggest account and take the combined RMD from there.

Non-EDB beneficiaries on the 10-year rule have no annual RMDs to aggregate in the first place (per TD 10001). Aggregation matters only when you're an EDB taking life-expectancy distributions, or in the spousal post-RMD-age scenario.

Different Beneficiary Types, Different RMD Rules

Spouse Treating the Roth as Their Own: No RMDs

If you're the surviving spouse and elect to treat the inherited Roth as your own (a spousal rollover), you step fully into the original owner's shoes: no RMDs, ever. This is almost always the right answer for Roths because you preserve decades of tax-free growth.

Spouse Keeping It as an Inherited Roth: Single Life Table RMDs

If a spouse keeps the account as inherited (sometimes useful if under 59½ and needing penalty-free access to earnings), annual RMDs apply using the Single Life Table. SECURE 2.0 §327 (effective 2024) lets the spouse elect to use the Uniform Lifetime Table instead—smaller RMDs—if they were the sole beneficiary. You recalculate each year.

Eligible Designated Beneficiary Using Life Expectancy: Annual RMDs

EDBs (disabled or chronically ill under IRC §§72(m)(7) / 7702B(c)(2), beneficiaries not more than 10 years younger than the owner, and minor children of the owner up to age 21) can use the life expectancy method. RMD = account balance ÷ Single Life Table factor for your age. The factor is subtracted by 1.0 each year (the "subtract-one method"), so RMDs slowly grow as a share of the account.

Non-Spouse on the 10-Year Rule: No Annual RMDs

This is the myth-buster. Because Treas. Reg. §1.408A-6, A-14(b) treats every Roth owner as having died before their RBD, TD 10001 confirms that non-spouse beneficiaries on the 10-year rule take no annual RMDs in years 1–9. The only distribution requirement is that the account reach $0 by December 31 of the 10th year after death.

This is a different answer than for inherited traditional IRAs, where annual RMDs in years 1–9 are required if the owner died on or after their RBD. For inherited Roths, the cleaner, more flexible rule applies.

Entity Beneficiary (Estate, Non-See-Through Trust, Charity): 5-Year Rule

If the Roth owner named an entity rather than an individual, a stricter rule applies: the account must be fully distributed by December 31 of the 5th year after death. No annual RMDs in years 1–4, but the full balance is out by year 5. Entity-beneficiary rules can be softened if a trust qualifies as a "see-through trust," which lets the trust look through to its individual beneficiaries.

How to Calculate an Annual RMD (When One Applies)

This math only applies if you're an EDB on the life-expectancy method, or a spouse keeping the Roth as inherited. Non-spouse beneficiaries on the 10-year rule skip this section entirely.

Formula: RMD = account balance (December 31 of prior year) ÷ life expectancy factor from the IRS Single Life Table.

Step 1: Look up your age on December 31 of the distribution year.

Step 2: Find your life expectancy in the Single Life Expectancy Table (Appendix B of IRS Publication 590-B). For non-spouse beneficiaries, you use the factor only in year 1, then subtract 1.0 each following year (the "subtract-one method"). For spouses keeping it as inherited, you re-enter the table fresh each year.

Step 3: Divide the December 31 prior-year balance by the life expectancy factor.

Step 4: Withdraw at least that amount by December 31 of the current year.

Understanding IRS Life Expectancy Tables

The IRS publishes three life expectancy tables in Publication 590-B:

• Single Life Expectancy Table: Default for inherited-account beneficiaries. This is the table EDBs on the life-expectancy method use.
• Joint Life and Last Survivor Table: Niche use, mainly for owners with a spouse who is more than 10 years younger.
• Uniform Lifetime Table: For the account owner's own lifetime RMDs. Not applicable to beneficiaries—with one carve-out: a sole-beneficiary spouse can elect to use it under SECURE 2.0 §327.

For most inherited Roths with an RMD obligation, use the Single Life Table. A non-spouse EDB subtracts 1.0 from last year's factor each year; a spouse who kept the account as inherited re-enters the table with her current age.

When the Owner's 5-Year Rule Wasn't Met: Basis Tracking and Ordering Rules

For most inherited Roths, the owner held the account long enough that the 5-year rule is satisfied and every dollar distributed is tax-free. But if the owner died with a Roth that was less than five tax years old, the distribution is not automatically taxable in full — the Roth's ordering rules under IRC §408A(d)(4) carry over to the inherited account, and only a portion is taxable.

Distributions are deemed to come out in a specific order:

1. Regular contributions first. Tax-free and penalty-free, regardless of the 5-year status.
2. Conversion amounts next, in order from oldest conversion to newest. Tax-free because the conversion was already taxed when it happened. The 10% early-withdrawal penalty never applies to an inherited account at any age.
3. Earnings last. This is the only layer that's taxable when the owner's 5-year rule wasn't met at death.

Worked example. Owner opened her Roth in 2023 with a $7,000 regular contribution, converted $50,000 from a traditional IRA in 2024 (paying income tax on it then), and died in 2026 with the account worth $75,000. The 5-year rule is not met. Of the $75,000, $7,000 is contribution basis (always tax-free), $50,000 is conversion basis (tax-free — already taxed), and only $18,000 is earnings (taxable when distributed). If the beneficiary takes just $25,000 in year 1, the distribution is $7,000 contribution + $18,000 of the 2024 conversion — zero income tax. Earnings are only pulled when basis is exhausted.

Planning implication. When the owner's 5-year clock was short, the beneficiary can stage distributions to take basis first and let earnings ride until the original owner's 5-year clock matures. That clock runs from January 1 of the year of the owner's first Roth contribution — it doesn't reset at inheritance. Once it matures, the earnings portion flips from taxable to tax-free. For a 2023-opened Roth, the 5-year clock matures January 1, 2028; if the beneficiary delays earnings distributions past that date, they're tax-free.

What records to gather. The custodian tracks account balance, not basis composition. You'll need the owner's Form 5498 history (annual contribution and conversion reports from the custodian), along with any Roth conversion records on the owner's prior Form 8606 filings, to reconstruct contributions and conversion amounts. Keep these with the inherited-account file and report distributions on your own Form 8606, Part III, following the ordering rules.

Penalties for Missing RMDs — IRC §4974

If you fail to take a required RMD by December 31, IRC §4974 imposes a 25% excise tax on the undistributed amount. Under SECURE 2.0 §302 (effective 2023), the tax drops to 10% if you correct the missed RMD within a two-year "correction window"—generally by the end of the second calendar year following the missed-RMD year, and before the IRS assesses the tax.

Example: Your required RMD was $10,000; you took $5,000. The $5,000 shortfall is subject to 25% excise tax ($1,250 owed on Form 5329). If you catch and correct it within the two-year window, the penalty drops to $500.

Waiver path: you can request a full waiver on Form 5329 with a reasonable-cause statement. The IRS has historically been lenient for first-time errors that were corrected promptly, but it's discretionary—don't bank on it.

For inherited Roths, keep in mind that even if you missed the RMD, the distribution itself is still tax-free income (assuming the owner's 5-year holding period was met). The excise tax is purely a penalty, not additional income tax.

How the Form 5329 Waiver Actually Works

The waiver procedure is buried in the Form 5329 instructions and confuses most first-timers. The sequence is:

1. Take the missed distribution first. The waiver is only available if you've already corrected the shortfall — don't wait for an IRS response before making up the missed amount.
2. Complete Form 5329, Part IX (Additional Tax on Excess Accumulation). Line 54: amount that should have been distributed. Line 55: amount actually taken. The difference is your shortfall.
3. Write “RC” (reasonable cause) and the dollar amount you want waived in the margin next to line 55. This is the signal to the IRS that you're requesting a waiver, not paying the tax.
4. Attach a statement of explanation — a short, plainly worded letter describing why the RMD was missed (death of spouse during the year, custodian calculation error, newly inherited account you weren't notified about) and what you've done to correct it and prevent recurrence.
5. File the form with your Form 1040 (or as a standalone if you've already filed). Do not pay the excise tax at filing — the waiver request defers payment pending the IRS decision.

Most properly documented, promptly corrected waiver requests are granted silently. If the IRS disagrees, you'll receive a CP15 notice and can pay the excise tax at that point.

Withholding Election: Don't Let the Custodian Withhold on Tax-Free Distributions

IRA distributions default to federal withholding because the system was designed around taxable traditional IRAs. Most custodians apply a 10% federal withholding on any IRA distribution unless you submit Form W-4R electing a different rate. For an inherited Roth that meets the 5-year rule, the distribution is entirely tax-free — withholding simply becomes a refund when you file your return, meaning you loan the IRS money at 0% interest for months.

Before every distribution (especially large ones taken in year 10 of the 10-year window), ask the custodian for a Form W-4R and elect 0% federal withholding. State-level withholding rules vary — check your state's treatment if applicable.