Inheriting a Roth IRA
Most advice about inherited retirement accounts is about managing a tax bill across ten years. An inherited Roth inverts it. The ten-year deadline still applies, but the withdrawals are generally tax-free, so there is no bill to spread — and the right move is usually to touch nothing until the last possible moment.
- Ten years to empty:: For most non-spouse beneficiaries. No annual distribution is required in between.
- Tax-free on the way out:: Qualified distributions carry no income tax, which is why there is nothing to spread.
- The five-year test:: Earnings are tax-free once the original owner's Roth had been open five years. Contributions and conversions come out tax-free regardless.
- A spouse has more options:: A surviving spouse can treat the account as their own, which removes the ten-year deadline entirely.
Where the AI summary above gets this wrong
"Take distributions from an inherited IRA evenly over ten years to spread the tax."
That's surface-true. Here's what it misses:
- There is no tax to spread — The even-withdrawal advice exists because a traditional inherited IRA produces taxable income, and bunching it raises the rate. A Roth produces none, so the advice reverses: every year you leave it invested is a year of untaxed growth you keep, and there is no rate to manage.
- The clock belongs to the deceased, not to you — Whether earnings are tax-free turns on how long the original owner had held a Roth IRA, not on how long you have held anything. If they opened their first Roth less than five years before dying, earnings withdrawn early can be taxable — while contributions and converted amounts still are not.
- Not every beneficiary is on the ten-year rule — A surviving spouse can treat the account as their own. A minor child of the deceased, a disabled or chronically ill beneficiary, or someone within ten years of the owner's age may have a longer horizon. Applying the ten-year rule reflexively can end an inheritance decades early.
01 What you have to do, and by when
For most non-spouse beneficiaries, an inherited Roth IRA must be emptied by the end of the tenth year after the owner's death. Unlike an inherited traditional IRA in some circumstances, there is no annual required distribution inside that window — the deadline is the whole requirement.
That combination is unusually favourable. Ten years of continued tax-free growth, no forced withdrawals along the way, and no income tax when the money finally comes out. The natural strategy is to leave it invested and take the whole balance in year ten.
The account has to be retitled as an inherited IRA and cannot be rolled into your own. A non-spouse beneficiary who moves the money into a personal IRA has made a distribution, and the mistake is generally not reversible. The same trap governs the rollover mechanics anyone inheriting an employer plan has to navigate.
Shows: what an inherited Roth adds if you leave it alone for the full ten-year window and empty it at the end, at a flat assumed return. Ignores: market variability, the five-year test on the original owner's account, whether you are an eligible designated beneficiary with a longer horizon, and any need to spend the money sooner.
Source: Publication 590-B
02 When earnings are tax-free, and when they are not
Roth withdrawals come out in a fixed order: contributions first, then converted amounts, then earnings. The first two categories are always free of tax and penalty in a beneficiary's hands. Earnings are free of tax only if the account is qualified.
For an inherited Roth, qualification turns on whether the original owner had held any Roth IRA for at least five years. Your own history is irrelevant. If they opened their first Roth three years before dying, the account becomes qualified two years later — and until then, earnings withdrawn are taxable, though never subject to the early distribution penalty.
In practice this rarely bites, because the ten-year deadline is longer than any unexpired five-year clock. Waiting solves it automatically, which is another reason the default answer is to wait.
Source: Publication 590-B
03 The beneficiaries the ten-year rule does not cover
A surviving spouse has the strongest position. They may treat the inherited Roth as their own, which removes the ten-year deadline and the account continues with no required distributions during their lifetime.
Certain other beneficiaries — a minor child of the deceased, a disabled or chronically ill person, or someone not more than ten years younger than the owner — may take distributions over a life expectancy instead. A minor child's exception ends at majority, at which point the ten-year clock starts.
Getting this wrong costs decades of tax-free growth, and the determination happens once, at the point of inheritance. It is worth establishing which category applies before any money moves, and worth revisiting the distribution planning for the rest of the estate at the same time.
This is the one inherited account where the best advice is to do nothing, and people find that unsatisfying. They want a plan. The plan is: retitle it correctly, invest it as you would any ten-year money, put a reminder in the calendar for year nine, and forget about it. The most common error I see is a beneficiary emptying it in the first year because that felt tidy — giving away a decade of tax-free compounding that nobody could ever have bought.
FAQ
Do I pay tax on an inherited Roth IRA?
Generally no. Qualified distributions from an inherited Roth are free of income tax. Earnings can be taxable only if the original owner had held a Roth IRA for less than five years, and waiting resolves that.
Do I have to take money out of an inherited Roth every year?
For most non-spouse beneficiaries, no. The requirement is to empty the account within ten years of the owner's death, with no annual minimum in between.
Can I roll an inherited Roth into my own Roth IRA?
Only a surviving spouse can treat it as their own. Any other beneficiary who moves the money into a personal account has taken a distribution, and it generally cannot be undone.
Sources
Regulator references
- Publication 590-B · Internal Revenue Service · 2026Distribution rules for inherited IRAs, including the ten-year rule and the Roth five-year test.Last verified: 2026-09-07
- Retirement topics: required minimum distributions · Internal Revenue Service · 2026Which beneficiaries may still stretch distributions over a life expectancy.Last verified: 2026-09-07
Calculator unit tests · the assertions this page's worked example is checked against, and their last result
Changelog
- 2026-09-07 — initial publish (new format)
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Jordan Reeves
Founder of Talk Through Wealth. A software engineer for over a decade before turning to retirement planning, Jordan built the projection engine after watching family members get fragmented, country-by-country advice that never reconciled. He writes about retirement the way the engine computes it: month-by-month, lifetime-long, and skeptical of any rule of thumb that hasn't been run through the math.