Inherited IRA Rules for Spouses in 2026 and the 10-Year Rule

What Is the 10-Year Rule for Inherited IRAs in 2026?

Most non-spouse beneficiaries must fully distribute an inherited IRA by December 31 of the 10th year after the original owner's death. This rule applies to deaths on or after January 1, 2020, and covers traditional IRAs, Roth IRAs, SEP IRAs, SIMPLE IRAs, and inherited 401(k) or 403(b) balances.

The SECURE Act of 2019 replaced the old "stretch IRA" strategy that let beneficiaries spread distributions over their own life expectancy, sometimes across 30 or 40 years. The replacement is blunt: 10 years, full stop.

But the 10-year deadline is only half the picture. The IRS issued final regulations in July 2024 clarifying a question that had confused beneficiaries and advisors for years: whether annual distributions are required during years 1 through 9, or whether you can wait until year 10 and take everything at once.

The answer depends on when the original owner died relative to their required beginning date (RBD):

• Owner died before RBD (before age 73 in 2026): No annual RMDs. You can take distributions on any schedule you choose, as long as the account is empty by the end of year 10.
• Owner died on or after RBD (at or after age 73 in 2026): Annual RMDs are required in years 1 through 9, calculated using the IRS Single Life Table in Publication 590-B. The remaining balance must come out by the end of year 10.

The IRS waived penalties for missed annual RMDs from 2021 through 2024 while the regulations were being finalized. Those waivers are over. Starting in 2025, the 25% excise tax on missed distributions is fully enforced.

One more detail: if you inherited an IRA from someone who died before 2020, the old stretch rules still apply. Those accounts are grandfathered. The 10-year rule only governs post-2019 deaths.

What Are a Surviving Spouse's Inherited IRA Options?

A sole-beneficiary spouse has three main choices: (1) roll the account into their own IRA (a spousal rollover), (2) keep it titled as an inherited IRA, or (3) take life-expectancy distributions from the inherited account. No other beneficiary type gets all three.

Sole-Beneficiary Determination

The IRS determines whether a spouse is the sole beneficiary by September 30 of the year following the account owner's death. If the IRA names multiple beneficiaries (for example, a spouse and adult children), the account typically needs to be divided by December 31 of that same year so each beneficiary can follow their own distribution rules. If the account isn't split in time, all beneficiaries may be stuck with the most restrictive schedule.

SECURE 2.0 Section 327

Effective January 1, 2024, Section 327 of SECURE 2.0 introduced a new option. A surviving spouse who keeps the account as a spousal inherited IRA can elect to be treated as the deceased owner for RMD purposes. This means the spouse can use the deceased's age and the Uniform Lifetime Table to calculate distributions, which often produces smaller annual RMDs than the Single Life Table would.

Comparison Table: Surviving Spouse Options

The spousal rollover IRA is generally the strongest option for a spouse who doesn't need immediate access to the funds and is already past age 59½. For a younger surviving spouse, keeping the account as an inherited IRA often makes more sense because it avoids the 10% early-withdrawal penalty.

Can a Surviving Spouse Delay RMDs on an Inherited IRA?

Yes, but the length of the delay depends entirely on two variables: whether the deceased spouse died before or after their required beginning date, and the surviving spouse's own age.

Spousal Rollover: Resetting the Clock

When you roll an inherited IRA into your own IRA, the account follows your timeline completely. You won't owe RMDs until you turn 73 (for 2026). If you're 55 when your spouse passes, that's 18 years of additional tax-deferred growth. The tradeoff is access: any withdrawal before you turn 59½ is subject to a 10% early-withdrawal penalty on top of ordinary income tax.

Keeping It Inherited: Deferring Until the Deceased's RMD Age

If the deceased spouse died before their required beginning date and you keep the account as an inherited IRA, you can delay RMDs until the year the deceased would have turned 73. For example, if your spouse died at age 65 in 2026, you could wait until the year they would have turned 73 (2034) to start taking distributions. During those eight years, the money continues growing tax-deferred, and you can access it penalty-free at any time.

If the deceased spouse died after their required beginning date, you must continue annual RMDs based on your own life expectancy or elect Section 327 treatment. There is no deferral window in this scenario.

The Tradeoff in Practice

Consider a surviving spouse who is 55 when they inherit a $500,000 traditional IRA:

• Spousal rollover: No RMDs for 18 years (until age 73). But if they need $30,000 in year one for living expenses, they'll pay income tax plus a $3,000 early-withdrawal penalty.
• Inherited IRA: Penalty-free access to the $30,000 immediately. RMDs begin when the deceased would have reached 73, or under Section 327 treatment.
• Hybrid approach: Keep the account as inherited until age 59½, then roll it into your own IRA. This gives penalty-free access now and maximum deferral later.

The required beginning date for 2026 is age 73 (the RBD is technically April 1 of the year after turning 73). Under SECURE 2.0, this rises to 75 starting in 2033, which will extend the deferral window further for younger surviving spouses.

What Happens If You Get It Wrong?

The excise tax under IRC Section 4974 is 25% of the shortfall, meaning the difference between what you should have withdrawn and what you actually withdrew. If you correct the mistake within two years, the penalty drops to 10%. Still, on a $500,000 account where you miss a $14,000 RMD, that's a $3,500 penalty at the reduced rate, or $3,500 to $3,500 at the full 25% rate.

How Do Inherited IRA RMD Rules Differ by Beneficiary Type?

Five categories of eligible designated beneficiaries (EDBs) can stretch distributions over their own life expectancy. Everyone else, including adult children, grandchildren, and most siblings, follows the 10-year rule.

The Five EDB Categories

1. Surviving spouse (most flexible, with rollover and Section 327 options)
2. Minor child of the decedent (stretch until age 21, then the 10-year clock starts)
3. Disabled individual (must meet the IRS disability definition)
4. Chronically ill individual (must meet the IRS definition under IRC Section 7702B)
5. Person not more than 10 years younger than the deceased (a sibling close in age, for instance)

Beneficiary Comparison Table

How the Annual RMD Calculation Works

For non-eligible designated beneficiaries subject to annual RMDs (because the original owner died on or after their required beginning date), the calculation uses the IRS Single Life Table. You look up your age on December 31 of the year following the year of death, find the corresponding life expectancy factor, and divide the prior year-end account balance by that factor. Each subsequent year, the factor reduces by 1.

For example, a 50-year-old beneficiary in 2026 would have a Single Life Table factor of 36.2. On a $500,000 inherited IRA, the year-one RMD would be approximately $13,812 ($500,000 / 36.2). In year two, the factor drops to 35.2, and the RMD recalculates based on the new balance.

Important: if the original owner missed an RMD in their year of death, the beneficiary is responsible for taking it. That RMD is calculated based on the owner's age, not the beneficiary's, and must be distributed by December 31 of the year of death.

How Should Couples Plan Inherited IRA Decisions with a Professional?

The right choice between a spousal rollover, keeping an inherited IRA, or a hybrid approach hinges on your ages, current and projected tax brackets, cash-flow needs, and the rest of your estate plan. Couples should map out these decisions with a CFP, CPA, and estate attorney before retitling anything.

This is exactly why Neptune exists. Neptune pairs couples and families with experienced attorneys (20+ years), CFPs, and CPAs who work together to coordinate beneficiary designations, tax strategy, and estate planning from start to finish. Instead of visiting three different offices and hoping everyone's on the same page, you get one team managing the full picture.

As Michael C. Cotugno, Esq., Managing Partner, Neptune Legal, puts it: "Understanding a partner's relationship with money, their historical experiences of abundance or scarcity, their anxieties tied to financial stability, or their personal definitions of success, allows for a deeper, more empathetic understanding of them as a whole individual."

That understanding matters enormously when you're making decisions about inherited retirement accounts. The choice between immediate access and long-term deferral isn't just a math problem. It reflects how each partner thinks about security, flexibility, and what the money is actually for.

Tax-Spreading Strategy

For couples who will eventually be on the receiving end of an inherited IRA (as a non-spouse beneficiary from a parent, for example), spreading distributions evenly across the 10-year window can keep you in a lower tax bracket compared to waiting until year 10 and taking a lump sum.

Here's a simplified comparison on a $500,000 inherited traditional IRA for a beneficiary in the 24% bracket (2026):

The difference can easily exceed $50,000 in total federal tax, and that doesn't account for state income tax. A CPA can model your specific numbers.

Coordinate Beneficiary Designations with Your Full Estate Plan

Beneficiary designations on IRAs override what your will says. If your IRA beneficiary form still names an ex-spouse or a deceased parent, that's who inherits the account, regardless of your current estate plan. Reviewing and updating designations is one of the simplest, highest-impact steps couples can take together.

Neptune's model makes this coordination seamless. Your attorney, CFP, and CPA review beneficiary designations alongside your prenup, trust documents, and tax strategy so nothing falls through the cracks.