Inherited 401(k) 10-Year Rule: 2026 Deadlines & RMDs
The 10-year rule sounds simple — empty the inherited account within ten years — but the July 2024 final regulations added a second clock: if the original owner had already started RMDs, most non-spouse beneficiaries must ALSO take annual distributions in years 1 through 9, enforced beginning in 2025.
Get the two clocks wrong and the penalty is a 25% excise tax on every dollar you should have taken. This page lays out who falls under which rule, what changed in 2024–2025, and a worked example you can map your own dates onto.
One rule sits above everything: a non-spouse beneficiary has no 60-day rollover. Money that leaves the plan as a check in your name is taxed that year, permanently — every other decision on this page assumes you did not make that one.
The one mistake that cannot be undone
A non-spouse beneficiary has NO 60-day rollover. If the plan cuts a check in your name and you deposit it, the entire account becomes taxable income that year — there is no Rev. Proc. self-certification, no IRS letter, no fix. The ONLY safe move is a direct trustee-to-trustee transfer into a properly titled inherited IRA. If anyone offers to "just send you a check," stop the call and get help first.
A worked example: death in 2024
Say the account owner died in March 2024 at age 76 — old enough that RMDs had already begun — leaving the 401(k) to an adult child (a non-spouse beneficiary who is not disabled and is more than 10 years younger).
Year of death (2024): if the owner hadn't yet taken their 2024 RMD, the beneficiary must take it — that obligation doesn't die with the owner.
Years 1–9 (2025–2033): the beneficiary takes an annual RMD each year, calculated on their own single-life expectancy. The IRS waived these annual RMDs for 2021–2024 while the rules were disputed, but enforcement began in 2025 — and the waiver years do NOT extend the final deadline.
Final deadline (December 31, 2034): the account must be empty. Anything left is an excess accumulation with a 25% excise tax attached.
The planning consequence: because the account must hit zero by year 10 regardless, many beneficiaries model spreading withdrawals fairly evenly rather than taking minimums for nine years and a giant taxable lump in year ten — a bunched final withdrawal often lands in a much higher bracket. That modeling is exactly what a CPA (or a flat-fee educational analysis) is for.
Who is exempt: eligible designated beneficiaries
Five categories escape the 10-year rule and may instead stretch distributions over life expectancy: (1) the surviving spouse — who can also simply treat the account as their own; (2) the owner's minor child — but only until majority, at which point the 10-year clock starts; (3) disabled beneficiaries; (4) chronically ill beneficiaries; (5) anyone not more than 10 years younger than the deceased — a sibling close in age, typically.
Also outside the rule: deaths before 2020 stay under the pre-SECURE "stretch" rules entirely. If you inherited before 2020 and have been taking life-expectancy RMDs, the 10-year rule did not retroactively attach to you.
Your distribution clock (2026 rules)
- Most non-spouse beneficiaries must empty the inherited account by December 31 of the 10th year after the death (SECURE Act 10-year rule).
- Under the July 2024 final regulations, if the original owner had already begun RMDs, you must ALSO take annual RMDs in years 1–9 — enforced beginning in 2025.
- A missed RMD carries a 25% excise tax on the shortfall (reducible to 10% if corrected within the correction window).
- Spouses have different options (including treating the account as their own). Eligible designated beneficiaries — minor children, disabled or chronically ill beneficiaries, or beneficiaries not more than 10 years younger — may use life-expectancy payouts instead.
Common questions
When exactly do I have to empty the account?
By December 31 of the 10th year after the year of death — a death in 2024 means empty by December 31, 2034. If the owner had already begun RMDs, you also owe annual distributions in years 1–9; both clocks run simultaneously.
What happens if I miss an annual RMD?
A 25% excise tax on the amount you should have withdrawn, reducible to 10% if you correct it within the correction window by taking the late distribution and filing Form 5329. The 2021–2024 IRS waivers ended with 2025 enforcement — many older articles still describe the waiver era.
Does the 10-year rule apply if the owner died before 2020?
No. Pre-2020 deaths remain under the old "stretch IRA" life-expectancy rules. The SECURE Act's 10-year rule applies to deaths in 2020 and later, and the annual-RMD overlay comes from the July 2024 final regulations, enforced from 2025.
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Educational information, current to the July 2024 final regulations as enforced in 2026 — not tax, legal, or financial advice. Beneficiary elections are frequently irreversible; verify with your own CPA or estate attorney before acting. Estate deadlines (including the 9-month federal estate-tax election window) exist — consult the estate's attorney.