Inheriting an IRA can feel like a windfall, but the tax rules are unlike those for any other inheritance. Every withdrawal from an inherited traditional IRA is ordinary income; inherited Roth distributions are tax free once the account has been open five years. There is no early distribution penalty at any age.
Most non spouse beneficiaries of owners who died after 2019 must empty the account by the end of the tenth year after death, and under the 2024 final regulations, if the owner had already reached his required beginning date, the beneficiary must also take annual distributions in years one through nine. Surviving spouses, minor children until 21, disabled or chronically ill beneficiaries and those within ten years of the owner's age can still stretch. The pace of withdrawals is the whole game: spread them, watch state tax, coordinate with any trust, and do not miss the annual amounts, because the 25 percent excise tax applies to inherited accounts too.
The full piece is at turnipseed.law.
