Inherited Roth IRA

Beneficiaries face distribution rules even though a Roth IRA owner has no lifetime RMDs. For an ordinary direct, non-EDB individual inheritance after 2019, with sole-beneficiary or qualifying separate-account status, no annual RMDs are required in years one through nine; the entire balance is due by December 31 of year ten. Life-expectancy, post-majority and successor schedules can require annual payments. Do not apply the ordinary result to every inherited Roth. See §1.408-8 and §1.401(a)(9)-3.

A distribution to a beneficiary because of death is federally qualified once the original owner's five-tax-year period is completed. That period generally starts with the first applicable Roth IRA contribution year, including a conversion, and does not restart at death. Before it ends, distributed earnings can be taxable; the death exception removes the 10% early-distribution tax, not that income tax. Contributions and conversions follow the Roth allocation rules. State treatment requires a separate check. See Publication 590-B (2025), chapter 2 and §1.408A-6.

For the ordinary direct non-EDB individual inheritance after 2019, the entire account must be distributed by December 31 of the tenth calendar year after the original owner's death. A 2026 death therefore has an ordinary deadline of December 31, 2036, with no annual Roth RMDs in 2027–2035. This describes that beneficiary category, not every spouse, trust, minor-child or successor case. The ten-year calendar explains its limits.

Under IRC §401(a)(9)(E)(ii), tested at the owner's death: a surviving spouse; the owner's child under 21; a person meeting the disability or chronic-illness requirements; or an individual not more than ten years younger than the owner. Exactly ten years younger qualifies; an older beneficiary can also qualify. Life-expectancy payments may be available, subject to the method and account facts. If EDB status rests only on being the owner's minor child, a life-expectancy method transitions at 21 to a deadline ten calendar years later, while required annual payments continue. Separate disability or chronic-illness status can change that result. See §1.401(a)(9)-4(e) and TD 10001.

A spouse may have an own-account election or rollover option, subject to its conditions, or may remain a beneficiary. The election to treat the inherited IRA as their own requires sole-beneficiary status and an unlimited right to withdraw; a trust named as beneficiary does not satisfy that condition merely because the spouse benefits from it. Valid own-Roth treatment means no lifetime Roth IRA RMDs, but withdrawals then follow the spouse's own-account rules rather than beneficiary death treatment. Keeping it inherited can preserve the death exception to the 10% early-distribution tax; that does not make nonqualified earnings income-tax-free. Confirm the method before acting. See §1.408-8(c) and §1.408A-6, Q&A 3.