Inheriting an inherited IRA: the successor beneficiary rules

Owner, beneficiary, successor: who is who

Three people sit in every inherited-inherited IRA, and the rules only make sense once they are kept apart.

• The original owner — the person whose IRA it was. Their death date, and whether they had reached their required beginning date (RBD), fixed the account's rules.
• The first beneficiary — the person the owner named. The regulations sort them into a designated beneficiary (most adult children and other individuals, on the 10-year rule) or an eligible designated beneficiary (EDB): the surviving spouse, the owner's minor child, a disabled or chronically ill individual, or someone not more than 10 years younger than the owner. EDBs may stretch distributions over life expectancy.
• The successor beneficiary — whoever inherits from the first beneficiary when the first beneficiary dies with money still in the account. What is a successor beneficiary? A beneficiary of a beneficiary.

The single most important fact about a successor: you cannot be an eligible designated beneficiary. EDB status is tested only against the original owner. So a disabled grandchild, a spouse of the first beneficiary, or a sibling close in age inherits on the same 10-year footing as anyone else. How the first beneficiary's regime was determined — and the RMD arithmetic that goes with it — is covered in the inherited IRA RMD rules guide; this page picks up at the second death.

The core rule: no new stretch

Before 2020, a successor simply continued the first beneficiary's life-expectancy schedule, however long that ran. The SECURE Act ended that for deaths after 2019, and the July 2024 final regulations (26 CFR §1.401(a)(9)-5(d) and (e), applied to IRAs through §1.408-8) set out exactly which clock the successor inherits. There are three situations.

(a) The first beneficiary was on the 10-year rule. The deadline is December 31 of the year containing the tenth anniversary of the original owner's death (§1.401(a)(9)-5(e)(2)). That deadline does not move when the first beneficiary dies. You get the remainder of the window — if your parent inherited in 2022 and died in 2028, you have until December 31, 2032. If the owner had died on or after their RBD, the annual RMDs your parent was taking continue on the same schedule; if the owner died before their RBD, there are none, just the deadline.

(b) The first beneficiary was an EDB stretching over life expectancy. On the EDB's death, the account must be emptied by December 31 of the year containing the tenth anniversary of the EDB's death (§1.401(a)(9)-5(e)(3)). That is a genuinely new 10-year window. But the annual distributions do not stop: the regulations keep the applicable denominator running on the first beneficiary's remaining life expectancy, reduced by one each year, so annual RMDs continue in years one through nine and the balance comes out in year ten. Your own age is irrelevant to the calculation. (Where the EDB was a surviving spouse who re-read the table each year, the factor is frozen at the spouse's figure for the year of death and then reduced by one annually — §1.401(a)(9)-5(d)(3)(iv).)

(c) The original owner died before 2020. If the owner died before January 1, 2020 and the first beneficiary dies on or after that date, the regulations treat the first beneficiary as though they had been an EDB, so the successor gets 10 years from the first beneficiary's death, with the stretch payments continuing in the meantime (§1.401(a)(9)-1(b)(2)(iii)). Only if both the owner and the first beneficiary died before 2020 does the old open-ended stretch survive (§1.401(a)(9)-5(e)(1)).

Your window at a glance

Find the row that describes the first beneficiary. Your own status never changes the answer.

The last row is the most valuable planning fact on this page. A spouse who elects to treat the IRA as their own, or rolls it over, breaks the chain: the children then inherit from the spouse as ordinary first beneficiaries, with a full 10-year window measured from the spouse's death — and an eligible child could still qualify as an EDB. A spouse who kept the account titled as inherited gives the children row three instead: 10 years, with annual RMDs on the spouse's frozen factor. The guide to what happens to your 401(k) when you die covers the spousal election from the owner's side.

A successor spouse is not a spousal beneficiary

The special spousal privileges — treating the account as your own, rolling it into your own IRA, recalculating life expectancy every year, delaying distributions until the owner would have reached 73 — belong only to the original owner's surviving spouse. If your husband inherited an IRA from his father and then died, you are a successor beneficiary of his father's IRA, not a spouse beneficiary of anything. You cannot roll it into your own IRA, you cannot treat it as yours, and you are on whichever clock the table above assigns.

That also means the money moves only by trustee-to-trustee transfer into an account titled as inherited. A check payable to you is a distribution, and a non-spouse cannot put it back with a 60-day rollover.

The first beneficiary's final-year RMD

If the first beneficiary had an annual RMD due for the year they died and had not taken all of it, the shortfall still has to come out that calendar year, paid to the successor. The final regulations say so directly: a required minimum distribution is due for the calendar year of the beneficiary's death and must be distributed to any beneficiary of the deceased beneficiary to the extent it was not already paid (§1.401(a)(9)-5(d)(1)(i)). It is taxed to whoever receives it — normally you.

One point is not settled. The final regulations give an automatic excise-tax waiver when an owner's year-of-death RMD is taken by December 31 of the following year. Whether the same automatic relief extends to a deceased beneficiary's final-year RMD was addressed only in proposed regulations, which were not final when this was written. Do not rely on it: when the first beneficiary dies late in the year, ask the custodian for the remaining figure immediately and take it before December 31. If it is missed, take it as soon as you can and request a waiver on Form 5329 with a reasonable-cause statement.

A worked example, with dates

Margaret died in 2021 at age 80, past her required beginning date. Her sole beneficiary was her brother Paul, born 1948 — seven years younger, so an eligible designated beneficiary who stretched distributions over his own life expectancy. Paul named his daughter Emma, born 1980, as beneficiary of the inherited IRA. Paul died on May 14, 2026, having not yet taken his 2026 RMD.

1. Which row? Row three: the first beneficiary was an EDB stretching, and the owner died after 2019.
2. 2026: Paul's unpaid 2026 RMD must be distributed to Emma by December 31, 2026. It is computed exactly as Paul's would have been.
3. The deadline: December 31 of the year containing the tenth anniversary of Paul's death — December 31, 2036.
4. 2027 through 2035: annual RMDs continue on Paul's factor, still reduced by one each year. Emma's age never enters it. The figure each year is the prior December 31 balance divided by that factor — the inherited IRA RMD calculator does the arithmetic.
5. 2036: whatever remains must come out.

Change one fact: suppose Paul had been 15 years younger than Margaret. He would have been an ordinary designated beneficiary on the 10-year rule with a deadline of December 31, 2031. Emma would inherit that same deadline — five and a half years, not ten — with annual RMDs continuing on Paul's schedule because Margaret died past her RBD. Identical family, identical death dates, a five-year difference in Emma's window, decided entirely by Paul's age relative to his sister.

How the account is titled

Custodians retitle an inherited-inherited IRA so that the chain stays visible, because the chain is what determines the rules. A typical form is "Margaret Hale, deceased, IRA FBO Paul Hale, deceased, FBO Emma Hale, beneficiary." Conventions vary by custodian, but two things should hold: the original owner's name stays on the account, and the account remains separate from any IRA of your own. Never let a custodian merge it into your IRA, and never retitle it in your name alone — that is treated as a full distribution. If a custodian's paperwork drops the first owner's name, have it corrected; the next successor will need the history.

Naming your own successor: the form nobody files

When you inherit an IRA, you become responsible for naming who receives it if you die before it is empty. Most beneficiaries never do. They complete the inheritance paperwork, sometimes invest the money, and never file a beneficiary designation on the new inherited account — the most-missed form in this entire area.

If no successor is named, the custodial agreement decides, and many default to the first beneficiary's estate. The deadline does not get worse — it is fixed by the first beneficiary's status regardless of who receives the account — but the route does: probate, delay, executor involvement, and distribution under the will rather than to the people you would have chosen. Some agreements do not permit successor designations at all, so check.

Inherited Roth IRAs

A Roth IRA owner has no lifetime RMDs, so the owner is always treated as having died before the required beginning date. For the common case — the first beneficiary was a non-spouse on the 10-year rule — that means no annual RMDs for the first beneficiary or for the successor, just the remainder of the original 10-year window. Distributions are generally tax-free once the owner's five-year holding period is met, so the planning question is usually how long to let the money grow, not how to spread the tax. (The first-beneficiary regime — spouse options, EDBs, the inherited five-year clock — is covered in inherited Roth IRA rules.)

Where the first beneficiary was an EDB taking life-expectancy payments from an inherited Roth, the successor gets 10 years from that beneficiary's death under §1.401(a)(9)-5(e)(3). The regulations' structure indicates the life-expectancy payments already underway continue in years one through nine, but IRS guidance addresses this Roth-specific combination less directly than the traditional-IRA case, and custodian practice varies — confirm the schedule with the custodian in writing.

One question comes up at every step of this: can the money just be converted to a Roth instead of managed on this clock? For a non-spouse beneficiary or successor, generally no — see can you convert an inherited IRA to a Roth for the narrow spousal exception and the workaround that does exist.

Taxes, trusts and planning the window

A successor pays tax exactly as a first beneficiary does: traditional-IRA distributions are ordinary income in the year received, with no 10% early-withdrawal penalty at any age because distributions after death are exempt under §72(t)(2)(A)(ii). If estate tax was paid on the account, the recipient may be entitled to an income-tax deduction for it under §691(c). How that income stacks on your other income is covered in how RMDs are taxed.

A shortened window compresses the same income into fewer years, which is why the minimum is rarely the right amount. Divide what remains by the years left and take roughly that much each year, leaning heavier in low-income years and watching IRMAA tiers as well as brackets.

If a trust is named as successor, the trust's terms decide who receives the money and when, but they cannot lengthen the window: the deadline is still set by the first beneficiary. A conduit trust passes each distribution straight out; an accumulation trust may hold it and pay compressed trust tax rates. The trade-offs are covered in putting a 401(k) or IRA in a trust, and the custodian-managed alternative in trusteed IRA vs trust as beneficiary.

Confirm the regime with the custodian and your CPA before the first withdrawal — custodians are not required to calculate beneficiary RMDs, and the IRS holds the recipient responsible. IRS Publication 590-B and the IRS RMD FAQs are the primary references.