How to Calculate Rmd on Inherited Ira

Inherited IRA RMD Calculator

Estimate your Required Minimum Distribution (RMD) from an inherited IRA based on your beneficiary type and the original owner's circumstances.

var singleLifeExpectancyTable = { 1: 81.6, 2: 80.6, 3: 79.6, 4: 78.6, 5: 77.6, 6: 76.6, 7: 75.6, 8: 74.6, 9: 73.7, 10: 73.7, 11: 72.7, 12: 71.7, 13: 70.7, 14: 69.7, 15: 68.7, 16: 67.7, 17: 66.7, 18: 65.7, 19: 64.8, 20: 63.8, 21: 62.8, 22: 61.8, 23: 60.8, 24: 59.9, 25: 58.9, 26: 57.9, 27: 56.9, 28: 56.0, 29: 55.0, 30: 54.0, 31: 53.0, 32: 52.1, 33: 51.1, 34: 50.1, 35: 49.1, 36: 48.2, 37: 47.2, 38: 46.2, 39: 45.3, 40: 44.3, 41: 43.3, 42: 42.4, 43: 41.4, 44: 40.4, 45: 39.5, 46: 38.5, 47: 37.6, 48: 36.6, 49: 35.7, 50: 34.7, 51: 33.8, 52: 32.8, 53: 31.9, 54: 30.9, 55: 30.0, 56: 29.1, 57: 28.2, 58: 27.2, 59: 26.3, 60: 25.4, 61: 24.5, 62: 23.6, 63: 22.7, 64: 21.8, 65: 20.9, 66: 20.0, 67: 19.2, 68: 18.3, 69: 17.5, 70: 16.7, 71: 15.9, 72: 15.1, 73: 14.3, 74: 13.6, 75: 12.9, 76: 12.2, 77: 11.5, 78: 10.8, 79: 10.2, 80: 9.6, 81: 9.1, 82: 8.6, 83: 8.1, 84: 7.6, 85: 7.2, 86: 6.8, 87: 6.4, 88: 6.0, 89: 5.6, 90: 5.3, 91: 5.0, 92: 4.7, 93: 4.4, 94: 4.1, 95: 3.8, 96: 3.6, 97: 3.4, 98: 3.1, 99: 2.9, 100: 2.7, 101: 2.5, 102: 2.3, 103: 2.1, 104: 1.9, 105: 1.8, 106: 1.7, 107: 1.5, 108: 1.4, 109: 1.3, 110: 1.2, 111: 1.1, 112: 1.0, 113: 0.9, 114: 0.8, 115: 0.7, 116: 0.6, 117: 0.5, 118: 0.4, 119: 0.3, 120: 0.2, 121: 0.1 }; function getLifeExpectancyFactorDirect(age) { if (age 121) return singleLifeExpectancyTable[121]; return singleLifeExpectancyTable[age]; } function calculateRMD() { var inheritedIRAValue = parseFloat(document.getElementById("inheritedIRAValue").value); var beneficiaryType = document.getElementById("beneficiaryType").value; var ownerDeathYear = parseInt(document.getElementById("ownerDeathYear").value); var ownerRBDReached = document.getElementById("ownerRBDReached").value; var beneficiaryAgeAtFirstRMDYear = parseInt(document.getElementById("beneficiaryAgeAtFirstRMDYear").value); var beneficiaryAgeCurrent = parseInt(document.getElementById("beneficiaryAgeCurrent").value); var rmdYear = parseInt(document.getElementById("rmdYear").value); var resultDiv = document.getElementById("rmdResult"); if (isNaN(inheritedIRAValue) || inheritedIRAValue < 0 || isNaN(ownerDeathYear) || ownerDeathYear < 1900 || isNaN(beneficiaryAgeAtFirstRMDYear) || beneficiaryAgeAtFirstRMDYear < 1 || isNaN(beneficiaryAgeCurrent) || beneficiaryAgeCurrent < 1 || isNaN(rmdYear) || rmdYear < 1900) { resultDiv.style.backgroundColor = '#f8d7da'; resultDiv.style.color = '#721c24'; resultDiv.innerHTML = "Please enter valid numbers for all fields."; return; } var rmd = 0; var message = ""; var firstRMDYear = ownerDeathYear + 1; var yearsPassedSinceFirstRMD = rmdYear – firstRMDYear; var tenYearRuleEndYear = ownerDeathYear + 10; if (rmdYear < firstRMDYear) { resultDiv.style.backgroundColor = '#fff3cd'; resultDiv.style.color = '#856404'; resultDiv.innerHTML = "RMDs typically begin the year following the owner's death. Please select an RMD year of " + firstRMDYear + " or later."; return; } if (beneficiaryType === "spouse" || beneficiaryType === "eligibleDesignated") { // Stretch beneficiaries (Spouse, Eligible Designated) var initialLifeExpectancyFactor = getLifeExpectancyFactorDirect(beneficiaryAgeAtFirstRMDYear); if (initialLifeExpectancyFactor === null) { resultDiv.style.backgroundColor = '#f8d7da'; resultDiv.style.color = '#721c24'; resultDiv.innerHTML = "Could not find life expectancy factor for the provided age. Please check the beneficiary's age at first RMD year."; return; } var currentDistributionPeriod = initialLifeExpectancyFactor – yearsPassedSinceFirstRMD; if (currentDistributionPeriod <= 0) { resultDiv.style.backgroundColor = '#f8d7da'; resultDiv.style.color = '#721c24'; resultDiv.innerHTML = "The distribution period for this beneficiary type has ended. The entire account should have been distributed in a prior year."; return; } rmd = inheritedIRAValue / currentDistributionPeriod; message = "Your estimated RMD for " + rmdYear + " is $" + rmd.toFixed(2) + ". This is based on your initial life expectancy factor of " + initialLifeExpectancyFactor.toFixed(1) + " reduced by " + yearsPassedSinceFirstRMD + " years."; } else if (beneficiaryType === "nonEligibleDesignated") { // Non-Eligible Designated Beneficiary (10-Year Rule) if (rmdYear > tenYearRuleEndYear) { resultDiv.style.backgroundColor = '#f8d7da'; resultDiv.style.color = '#721c24'; resultDiv.innerHTML = "The 10-year distribution period has ended. The entire account should have been distributed by December 31st of " + tenYearRuleEndYear + "."; return; } if (ownerRBDReached === "No") { // Owner died BEFORE RBD – No annual RMDs, full distribution by year 10 if (rmdYear < tenYearRuleEndYear) { message = "No RMD is required for " + rmdYear + ". The entire inherited IRA balance must be distributed by December 31st of " + tenYearRuleEndYear + "."; } else { // rmdYear == tenYearRuleEndYear rmd = inheritedIRAValue; // The full balance is the RMD for the 10th year message = "The entire inherited IRA balance of $" + inheritedIRAValue.toFixed(2) + " must be distributed by December 31st of " + tenYearRuleEndYear + "."; } } else { // Owner died AFTER RBD – Annual RMDs required during 10-year period var currentLifeExpectancyFactor = getLifeExpectancyFactorDirect(beneficiaryAgeCurrent); if (currentLifeExpectancyFactor === null) { resultDiv.style.backgroundColor = '#f8d7da'; resultDiv.style.color = '#721c24'; resultDiv.innerHTML = "Could not find life expectancy factor for the provided current age. Please check the beneficiary's current age."; return; } rmd = inheritedIRAValue / currentLifeExpectancyFactor; message = "Your estimated RMD for " + rmdYear + " is $" + rmd.toFixed(2) + ". This is based on your current age (" + beneficiaryAgeCurrent + ") and the Single Life Expectancy Table. The entire account must still be distributed by December 31st of " + tenYearRuleEndYear + "."; } } resultDiv.style.backgroundColor = '#e2f0e4'; resultDiv.style.color = '#155724'; resultDiv.innerHTML = message; } // Initial calculation on page load for default values document.addEventListener('DOMContentLoaded', calculateRMD);

Understanding Inherited IRA Required Minimum Distributions (RMDs)

Inheriting an Individual Retirement Account (IRA) can be a significant financial event, but it comes with complex rules regarding Required Minimum Distributions (RMDs). These rules dictate how and when you must withdraw money from the inherited account, and failing to comply can result in hefty penalties.

What is an Inherited IRA?

An inherited IRA is an IRA that has been passed down to a beneficiary after the original owner's death. The rules for inherited IRAs differ significantly from those for your own IRA, primarily concerning when you must start taking distributions and how quickly the account must be depleted.

The Impact of the SECURE Act

The Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 dramatically changed the rules for inherited IRAs, especially for non-spouse beneficiaries. Prior to the SECURE Act, most non-spouse beneficiaries could "stretch" RMDs over their own life expectancy, allowing the inherited funds to continue growing tax-deferred for many years. The SECURE Act largely eliminated this "stretch" provision for most non-spouse beneficiaries, introducing a 10-year rule.

Key Beneficiary Types and RMD Rules:

The RMD rules for an inherited IRA depend heavily on your relationship to the deceased owner and whether the owner died before or after their Required Beginning Date (RBD) for RMDs (generally age 73 for those turning 73 after 2022, 72 for those turning 72 after 2019 and before 2023, or 70.5 before 2020).

1. Spouse Beneficiary:
   • Treat as Your Own IRA: A surviving spouse can roll over the inherited IRA into their own IRA or treat the inherited IRA as their own. This is often the most advantageous option, allowing them to delay RMDs until they reach their own RBD.
   • Treat as Inherited IRA: If the spouse chooses to keep it as an inherited IRA, they can take RMDs based on their own life expectancy (using the Single Life Expectancy Table). If the original owner died after their RBD, the spouse can choose to use the deceased owner's remaining life expectancy if it's longer.
2. Eligible Designated Beneficiary (Non-Spouse):

   These beneficiaries are exempt from the 10-year rule and can still "stretch" RMDs over their own life expectancy. This category includes:

   • The deceased owner's minor child (until they reach the age of majority, typically 21).
   • A disabled individual.
   • A chronically ill individual.
   • An individual who is not more than 10 years younger than the deceased owner.

   For these beneficiaries, RMDs are calculated annually using the Single Life Expectancy Table, with the distribution period reduced by one for each subsequent year.

3. Non-Eligible Designated Beneficiary (Subject to 10-Year Rule):

   This category includes most non-spouse beneficiaries (e.g., adult children, siblings, friends) who do not meet the criteria for an Eligible Designated Beneficiary. The 10-year rule applies here, but with a critical distinction:

   • Owner Died BEFORE RBD: If the original owner died before their Required Beginning Date, no annual RMDs are required for the first nine years. However, the entire inherited IRA balance must be distributed by December 31st of the 10th year following the owner's death.
   • Owner Died AFTER RBD: If the original owner died after their Required Beginning Date, annual RMDs *are* required during the 10-year period. These RMDs are calculated each year based on the beneficiary's life expectancy (using the Single Life Expectancy Table for their current age). The entire account must still be distributed by December 31st of the 10th year following the owner's death.
4. Non-Designated Beneficiary:

   If the beneficiary is an entity like an estate or a trust that does not qualify as a "look-through" trust, the rules are generally stricter:

   • Owner Died BEFORE RBD: The entire account must be distributed by the end of the fifth year following the owner's death (the "5-year rule").
   • Owner Died AFTER RBD: The account must be distributed over the deceased owner's remaining life expectancy, or by the end of the 10th year if the SECURE Act applies to the trust. This is a complex area often requiring professional advice.

How to Use the Calculator:

Our Inherited IRA RMD Calculator helps you estimate your required distribution for a specific year. Simply input the following details:

• Inherited IRA Account Balance: The value of the IRA as of December 31st of the year prior to the RMD year.
• Your Beneficiary Type: Select whether you are a Spouse, Eligible Designated Beneficiary, or Non-Eligible Designated Beneficiary.
• Year of Original Owner's Death: The calendar year the original IRA owner passed away.
• Did the original owner reach their Required Beginning Date (RBD) before death?: Indicate if the owner had already started taking their own RMDs.
• Your Age in the Year Following Owner's Death (or when first RMD was taken): This is crucial for "stretch" beneficiaries to establish the initial distribution period.
• Your Current Age (as of Dec 31st of the RMD year): Used for non-eligible designated beneficiaries if annual RMDs are required.
• Year for which RMD is being calculated: The specific year for which you want to determine the RMD.

The calculator will then provide an estimated RMD based on the IRS Single Life Expectancy Table (Table I) and the applicable rules.

Examples:

Let's look at a few scenarios to illustrate how the RMD rules apply:

Example 1: Spouse Beneficiary (Stretch)
Account Balance: $200,000
Beneficiary Type: Spouse
Owner Death Year: 2022
Owner RBD Reached: No
Beneficiary Age in Year Following Death (2023): 60
Current Age (2024): 61
RMD Year: 2024

Calculation: Initial life expectancy factor for age 60 is 25.4. For 2024 (2 years after 2022 death, so 2nd RMD year), the factor is 25.4 – (2024 – 2023) = 25.4 – 1 = 24.4.
RMD = $200,000 / 24.4 = $8,196.72

Example 2: Eligible Designated Beneficiary (Minor Child, Stretch)
Account Balance: $150,000
Beneficiary Type: Eligible Designated Beneficiary
Owner Death Year: 2022
Owner RBD Reached: Yes
Beneficiary Age in Year Following Death (2023): 10
Current Age (2024): 11
RMD Year: 2024

Calculation: Initial life expectancy factor for age 10 is 73.7. For 2024 (2 years after 2022 death, so 2nd RMD year), the factor is 73.7 – (2024 – 2023) = 73.7 – 1 = 72.7.
RMD = $150,000 / 72.7 = $2,063.27

Example 3: Non-Eligible Designated Beneficiary (Owner Died BEFORE RBD)
Account Balance: $100,000
Beneficiary Type: Non-Eligible Designated Beneficiary
Owner Death Year: 2022
Owner RBD Reached: No
Beneficiary Age in Year Following Death (2023): 40
Current Age (2024): 41
RMD Year: 2024

Result: No RMD is required for 2024. The entire inherited IRA balance must be distributed by December 31st of 2032 (2022 + 10 years).

Example 4: Non-Eligible Designated Beneficiary (Owner Died AFTER RBD)
Account Balance: $180,000
Beneficiary Type: Non-Eligible Designated Beneficiary
Owner Death Year: 2022
Owner RBD Reached: Yes
Beneficiary Age in Year Following Death (2023): 50
Current Age (2024): 51
RMD Year: 2024

Calculation: Life expectancy factor for current age 51 is 33.8.
RMD = $180,000 / 33.8 = $5,325.44. The entire account must still be distributed by December 31st of 2032.

Important Considerations:

The rules for inherited IRAs are complex and can have significant tax implications. This calculator provides an estimate based on common scenarios and the IRS Single Life Expectancy Table (Table I). It does not account for all possible edge cases, such as multiple beneficiaries, specific trust provisions, or changes in IRS guidance. Always consult with a qualified financial advisor or tax professional for personalized advice regarding your inherited IRA.