10 Year RMD | Ed Slott and Company, LLC

10 Year RMD

80 year old client dies last month, in year 9 of her RMDs. Does the new SECURE act mean that the kids can avoid taking anything for the next 9 years? In the 10th, they would empty all of it.

Yes, they will not have annual RMDs, but their inherited account will have to be drained by 12/31/2030. However, if they wait until the end, the lump sum distribution could spike their marginal rate that year. May be better to withdraw somewhat proportionately over the 11 tax years starting this year. If a Roth is inherited, because distributions will be tax free, it is better to wait until the end.

 

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