If you inherited an IRA after 2019, the SECURE Act changed everything. Here is what most beneficiaries miss.
Before 2020, an inherited IRA could be "stretched" over the beneficiary's lifetime. The SECURE Act ended that for most non-spouse beneficiaries. Now, the inherited account must generally be emptied within ten years.
Most beneficiaries default to waiting until year ten and then taking one large distribution. That is almost always the wrong move. A single large distribution can push the beneficiary into a much higher bracket than spreading withdrawals over the full window.
There are exceptions: surviving spouses, minor children, disabled beneficiaries, and beneficiaries less than ten years younger than the original owner have different rules.
We help beneficiaries map distributions against their own income years, planned retirement, and Medicare timing, often saving five figures in lifetime taxes from the planning alone.