Tool · Decision Engine

The Inherited Roth IRA Decision Engine

Tell us who inherited the account and we'll classify your beneficiary category, tell you which rule applies, set the deadline, and build your year-by-year optimal distribution schedule. Accurate under TD 10001 — the July 2024 final Treasury regulations that most calculators still get wrong for Roth IRAs.

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1. Your relationship to the original owner

2. Additional details

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I am a minor (under 21)

Only applies if you are a child (not grandchild) of the decedent.

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I am 21 or older

The minor-child EDB exception no longer applies.

Your current age

Are you not more than 10 years younger than the decedent? (Same age or older also qualifies.)

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Yes — within 10 years

You qualify as an Eligible Designated Beneficiary.

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No — more than 10 years younger

The 10-year rule will apply.

Disability / chronic illness status

I meet the IRC §72(m)(7) definition of disabled I meet the IRC §7702B(c)(2) definition of chronically ill

3. Dates & account details

Date of death

Decedent's first Roth contribution or conversion (year)

Applies to any Roth account the decedent ever owned. Determines whether earnings are tax-free.

Current balance

Expected return (%)

Your age the year after death

Used to look up the Single Life Expectancy factor.

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Start with the first question

Select your relationship to the original account owner, and the tool will guide you through the remaining questions.

Your classification

gavel event Empty by Dec 31, timer

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No annual RMDs are required during years 1 through 9.

Under TD 10001 (July 2024 final regs), a Roth IRA owner is always treated as dying before their required beginning date — Roth owners never have an RBD. So the "at-least-as-rapidly" rule that generates annual RMDs for inherited traditional IRAs does not apply here. Your only obligation is to empty the account by December 31, . Most online guidance (and many tax-prep tools) still get this wrong.

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You have more options than any other beneficiary.

For most surviving spouses, a spousal rollover (treating the Roth IRA as your own) is the best path — you get no RMDs during your lifetime and the account continues to compound tax-free. The main exception is if you are under age 59½ and may need access to earnings: keeping the account as an inherited Roth lets you withdraw without the 10% early-withdrawal penalty under IRC §72(t)(2)(A)(ii).

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The 5-year rule applies — a shorter, stricter deadline.

Because the account was left to an entity (estate, non-see-through trust, or charity) rather than a designated beneficiary, the 5-year rule under IRC §401(a)(9)(B)(ii) applies. The full balance must be distributed by December 31, . A see-through trust with all identifiable beneficiaries can avoid this — consult an estate attorney if that applies.

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You qualify for the life-expectancy stretch.

As a minor child of the decedent you take annual distributions under the Single Life Expectancy table until you reach age 21. On your 21st birthday the 10-year rule begins, and the account must be empty by December 31 of the 10th year after. Your current age implies the 10-year window will run from approximately to .

You may stretch distributions over your own Single Life Expectancy — an annual distribution equal to your remaining account balance divided by the applicable IRS factor. This preserves decades of tax-free compounding. You can always take more than the required amount.

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You are grandfathered under the pre-SECURE Act stretch rules.

Because the original owner died on or before December 31, 2019, the SECURE Act does not apply. You take annual distributions over your Single Life Expectancy factor — the factor is fixed at year 1 and decreases by 1 each year. The account continues tax-free for as long as it has a balance.

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The 5-year rule on earnings is not yet satisfied.

The decedent's first Roth contribution was in , so the account becomes fully qualified (tax-free on earnings) starting January 1, . Until then, earnings withdrawn are ordinary income (no 10% penalty applies — you are withdrawing from an inherited account). Contributions and conversions withdrawn are always tax-free. The clock runs with the account, not with you.

Optimal distribution schedule

Because earnings grow tax-free inside the Roth and you face no annual RMD, the mathematically optimal strategy is to defer every dollar to year 10. The account compounds tax-free for the entire window, then is emptied in one lump distribution.

An equal-annual strategy pulls money out steadily. Useful if you'll deploy the funds for ongoing needs, but it forgoes tax-free compounding on the withdrawn dollars.

Entity beneficiaries must empty the account within 5 years. The deferred strategy keeps balance compounding until year 5.

Remaining balance Distribution

Year	Start balance	Growth	Distribution	End balance

Total

Simplified model: growth compounds at your expected return, distributions come at end-of-year. Actual market returns will vary; taxes on earnings distributions (if the 5-year rule is not met at death) are not modeled here.

Single Life Expectancy stretch schedule

First-year factor at age : . This factor decreases by 1 each subsequent year. The first 20 years are shown below.

Year	Age	Factor	Start balance	RMD	End balance

Pre-SECURE stretch schedule

Your first-year factor at age : . Under the pre-2020 rules, this stretch runs for as long as the account has a balance (factor decreases by 1 each year; when it reaches 0, the remaining balance is fully distributed).

Year	Age	Factor	Start balance	RMD	End balance

User Guide

How to use the Inherited Roth IRA Calculator

This calculator models the lifetime value of an inherited Roth IRA under your specific beneficiary classification and distribution strategy. For a 10-year-rule Designated Beneficiary, it compares lump-sum, equal-annual, and back-loaded distribution schedules. For an Eligible Designated Beneficiary (EDB), it models life-expectancy distributions against full acceleration. The output is terminal wealth under each strategy, including the value of continued tax-free growth on undistributed balances.

For most people, the optimal inherited-Roth strategy is counterintuitive: wait as long as you're allowed. Federally, qualified Roth distributions are tax-free at any age, so the "save on taxes" argument that drives most retirement distribution planning doesn't apply. What does apply is opportunity cost — each year the balance stays in the Roth is another year of tax-free compounding, which is the most valuable tax shelter in the US system. The calculator makes the back-loaded strategy's advantage concrete.

Who should use this tool

Anyone planning distributions from an inherited Roth. Use it in conjunction with the Beneficiary Type tool to first determine your classification — the rules differ materially between EDBs and 10-year-rule DBs, and the calculator applies the right mathematics only if you've input the right classification.

It's also useful for inheritance planners (the original Roth owner designing beneficiary strategy) to see what their heirs will actually face under different designations. If you're choosing between naming a spouse versus a trust versus children, modeling each option's downstream math changes the designation decision.

Walking through the inputs

Inherited balance at date of death. Include any growth since. The custodian will typically confirm this figure.

Your classification. EDB or 10-year DB. The calculator doesn't handle non-designated beneficiaries (estates, non-look-through trusts) because those rarely benefit from modeling — their 5-year deadline forces distributions quickly.

Your age and expected life expectancy. Used for the EDB life-expectancy calculation. The IRS Single Life Expectancy table in Publication 590-B is the source; the tool uses the corresponding age factor for each year.

Your expected growth rate. The real rate of growth you expect in the inherited Roth. Higher growth favors back-loading (leave the money in the Roth until required); lower growth narrows the gap between strategies.

Your state tax rate on Roth distributions. Most states conform to the federal treatment (tax-free for qualified distributions), but a small number apply state tax to inherited Roth distributions. Enter your state rate if applicable — it's usually zero.

Medicare status. Relevant for IRMAA. A distribution that crosses an IRMAA tier two years forward raises your Medicare Part B and D premiums, which is effectively a hidden tax on Roth distributions for Medicare-age beneficiaries. The tool annualizes this into a dollar cost.

How to read the result

The tool returns terminal wealth under each strategy, including the value of any undistributed balance at the end of the distribution window. For a 10-year-rule DB, the three scenarios are: lump sum year 1 (maximum early access, zero post-distribution growth); equal annual (one-tenth each year); and back-loaded year 10 (take nothing until required, then pull the full balance in year 10). For an EDB, the two scenarios are life-expectancy distributions and full acceleration.

The tool highlights the optimal strategy and shows the dollar cost of each alternative relative to optimal. In most cases without state tax or IRMAA complications, back-loading wins by a wide margin — often 15–30 % more terminal wealth than a lump sum. When state tax or IRMAA does apply, equal-annual often wins because it keeps each year's distribution below the relevant thresholds.

Common mistakes this tool prevents

Defaulting to equal-annual distributions. Many advisors recommend "one-tenth per year" as a default simply because it sounds reasonable. For federally-tax-free Roth distributions without state-tax or IRMAA complications, back-loading almost always wins because you get nine more years of tax-free growth on the undistributed balance.
Forgetting state tax. A handful of states tax Roth distributions even though the federal treatment is tax-free. If you live in one of them, an equal-annual schedule reduces the per-year state-tax hit and often becomes optimal.
Ignoring IRMAA. For Medicare-age beneficiaries, Roth distributions count toward MAGI for IRMAA purposes. A distribution that crosses an IRMAA tier raises Medicare premiums two years forward. Equal-annual often avoids tier crossings; lump-sum almost always triggers them.
Treating the 10-year deadline as optional. It isn't. The SECURE Act 10-year deadline applies to all post-2019 Roth-IRA deaths; failing to empty the account by December 31 of year 10 triggers the §4974 excise tax on the remaining balance. The tool caps any strategy at the deadline.
Confusing inherited Roth rules with inherited Traditional rules. Inherited Traditional IRAs from owners who had already started RMDs require annual RMDs during years 1–9 of the 10-year window. Inherited Roths do NOT — Roth owners have no RBD under IRC §408A(c)(5), so no annual RMDs apply for any post-2019 Roth death. The only deadline is December 31 of year 10.
Assuming distributions are taxable. For qualified inherited Roths (original account open at least five years at owner's death), federal tax is zero. The "tax cost" the tool shows is state tax and IRMAA only — federal cost is zero.

After you choose a strategy

Document your schedule in writing and set calendar reminders for the required minimums (if any) and the year-10 deadline. Re-check annually — if your state of residence, Medicare status, or income profile changes, the optimal schedule can shift.

If the inherited balance is large relative to your own portfolio (say, 30 % or more), consider whether the distributions affect your own asset-location strategy — large Roth distributions landing in taxable can change which funds belong where. The Inherited Roth pillar covers the broader planning context including coordination with spouse-beneficiary elections.

Worked example: state tax changes the optimum

Zach, 42, inherits a $400,000 Roth IRA from his uncle in 2026. Classification: Designated Beneficiary (10-year rule). The uncle's Roth was 18 years old, so distributions are fully qualified. Zach lives in California and is subject to state income tax of approximately 9.3 % on ordinary-character income. California conforms to federal treatment for inherited Roths, so the distributions are also California-tax-free. He is not Medicare-age.

Because neither federal tax, California state tax, nor IRMAA apply to his distributions, Zach's optimization becomes pure growth compounding. The calculator's three scenarios:

Lump sum year 1: $400,000 received immediately and invested in taxable. At 4 % after-tax real (reflecting his 32 % federal marginal rate applied to dividends and the approximately 1-year-average California cap-gains drag), it grows to approximately $570,000 in 10 years.

Equal annual: $40,000/year distributed, with the remaining balance compounding at 5 % real inside the Roth and the distributed dollars at 4 % in taxable. Terminal wealth year 10: approximately $619,000.

Back-loaded: Full balance distributed in year 10. $400,000 compounds at 5 % real for 10 years inside the tax-free Roth wrapper to approximately $651,000, all received tax-free. Terminal wealth: $651,000.

Back-loading wins by $81,000 over lump-sum and $32,000 over equal-annual. The entire advantage comes from the tax-free wrapper's superior compounding.

Now change one variable: suppose Zach lived in New Jersey, which does tax inherited Roth distributions. Assume a 5 % effective state rate. Under back-loading he'd owe roughly $32,550 of state tax in year 10 on the $651,000 distribution, dropping terminal wealth to about $618,000. Under equal-annual he'd owe $2,000/year of state tax ($20,000 total, but smoothed so no dollar of it compounds as aggressively as the back-loaded lump). Terminal wealth under equal-annual drops to about $605,000. In this modified scenario back-loaded still wins marginally, but the margin is small.

If Zach were Medicare-age (not in this example), equal-annual would win decisively, because back-loading a $651,000 distribution in a single year would cross every IRMAA tier and spike his Part B and D premiums two years forward.

The tool surfaces this sensitivity in its sidebar: "state tax: 0 % → back-load; 5 % → back-load (narrow); 10 % → equal-annual." Knowing your state's treatment of inherited Roths is the first input that matters.

Methodology & sources

Every classification branch and every schedule formula is documented below. If you find a case we're handling incorrectly, email the editorial desk — accuracy trumps all other considerations here.

How the classification tree works expand_more

The tool applies the SECURE Act / SECURE 2.0 beneficiary taxonomy under IRC §401(a)(9)(E) and the final regulations at Treas. Reg. §1.401(a)(9)-4 (TD 10001, July 18, 2024). In order:

Pre-2020 death → grandfathered. SECURE Act applies only when the original owner died on or after January 1, 2020.
Surviving spouse → multiple options (rollover, inherited, surrogate election under SECURE 2.0 §327).
Non-designated beneficiary (entity, estate, non-see-through trust, charity) → 5-year rule under IRC §401(a)(9)(B)(ii). The ghost life expectancy rule for non-DBs applies only where the owner died on or after their required beginning date, which is impossible for a Roth IRA owner.
Disabled or chronically ill → Eligible Designated Beneficiary; stretch over Single Life Expectancy.
Minor child of the decedent (not grandchild) → stretch until age 21, then the 10-year rule begins. Per SECURE 2.0, age 21 is the fixed age of majority for this purpose.
Not more than 10 years younger than the decedent → EDB; stretch over Single Life Expectancy.
Everyone else (most adult children, siblings more than 10 years younger, friends, unmarried partners) → 10-year rule.

Why there are no annual RMDs for an inherited Roth under the 10-year rule expand_more

Under the final regulations, whether annual RMDs are required inside the 10-year window depends on whether the owner died before or on-or-after their required beginning date (RBD). The RBD is generally April 1 of the year after the owner turns 73 (under SECURE 2.0 §107, rising to 75 in 2033).

A Roth IRA owner never has an RBD — IRC §408A(c)(5) exempts Roth IRAs from the §401(a)(9) distribution-during-life rules. Therefore the Roth owner is always treated as having died before their RBD, and the "at-least-as-rapidly" principle that generates annual RMDs in years 1–9 for inherited traditional IRAs does not apply. The only requirement is that the account be distributed in full by December 31 of the 10th year.

This is the single most common error in online guidance about inherited Roth IRAs, including in otherwise reputable sources.

5-year qualified-distribution rule on inherited accounts expand_more

The 5-year rule for qualified distributions under IRC §408A(d)(2) follows the decedent's clock, not yours. If the decedent first contributed to any Roth IRA at least five taxable years before death, the account is "qualified" for the beneficiary and all earnings withdrawn are tax-free. Otherwise, the clock continues to run with the account, and earnings withdrawn before the 5-year mark remain ordinary income to the beneficiary.

Contributions and conversion basis withdrawn by an inheritor are always tax-free. The 10% early-withdrawal penalty never applies to an inherited IRA under IRC §72(t)(2)(A)(ii).

Schedule formulas expand_more

Deferred strategy (10-year or 5-year rule): balance grows at the expected return in each year; distribution is zero until the deadline year, then equals the full remaining balance.

Equal-annual strategy: a fixed annual distribution sized to exhaust the account at the deadline, solved from the end-of-year annuity formula D = B₀ · r · (1+r)ᴺ / ((1+r)ᴺ − 1), where N is the number of years in the window.

Stretch strategy (EDB, grandfathered): annual RMD equals the prior-year-end balance divided by the Single Life Expectancy factor. The initial factor comes from the 2022 Single Life Table (Treas. Reg. §1.401(a)(9)-9, as revised by TD 9930) at the beneficiary's age in the year after death, and decreases by 1 each subsequent year.

Primary sources expand_more

Treasury Decision 10001 (July 18, 2024) — final RMD regulations interpreting the SECURE Act and SECURE 2.0.
IRC §401(a)(9) — required minimum distributions generally.
IRC §401(a)(9)(E) — Eligible Designated Beneficiary categories (added by SECURE Act, Public Law 116-94).
IRC §401(a)(9)(H) — the 10-year rule.
IRC §408A(c)(5) — Roth IRAs exempt from lifetime RMD rules.
IRC §408A(d)(2) — 5-year rule for qualified distributions.
IRC §72(t)(2)(A)(ii) — no 10% early-withdrawal penalty on distributions from an inherited IRA.
IRC §72(m)(7) — definition of disabled.
IRC §7702B(c)(2) — definition of chronically ill.
Treas. Reg. §1.401(a)(9)-9 — Single Life Table (updated by TD 9930, effective Jan 1, 2022).
SECURE 2.0 Act §327 — spousal election to be treated as the deceased owner.
IRS Publication 590-B — Distributions from Individual Retirement Arrangements (annual guidance).

Last reviewed: April 2026. For changes or corrections: corrections@rothirahub.com.

Read the companion articles

Overview

Inherited Roth IRA — the full guide

Everything the tool classifies, explained in depth.

The big differentiator

The 10-year rule for Roth IRAs

Why there are no annual RMDs — and why most sites get this wrong.

Non-spouse beneficiaries

Non-spouse inherited Roth rules

Adult children, grandchildren, siblings, partners.

Edge cases

Special situations — trusts, minors, charities

When the standard path doesn't apply.