Episode 289 - Are You Inheriting an IRA?

In this episode of Beer and Money, Ryan Burklo discusses the recent changes to the rules governing inherited IRAs, particularly focusing on the new 10-year rule that requires non-spouse beneficiaries to deplete inherited accounts within a decade. He explains the implications of this rule, exceptions for certain beneficiaries, and the importance of tax strategies when managing inherited funds. The episode emphasizes the need for financial planning and awareness of IRS regulations to avoid penalties and optimize tax efficiency.

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Takeaways

The 10-year rule requires non-spouse beneficiaries to deplete inherited IRAs within 10 years.
Prior to 2020, beneficiaries could stretch withdrawals over their lifetime.
Exceptions to the 10-year rule exist for minor children and disabled individuals.
Tax planning is crucial when withdrawing from inherited IRAs.
Delaying withdrawals until year 10 can lead to significant tax implications.
Inherited traditional IRAs are subject to ordinary income tax rates upon distribution.
Understanding these rules is imperative to avoid penalties.
The IRS is now enforcing these rules more strictly than before.
Financial planning should consider retirement timing and income changes.
Resources are available for individuals to assess their financial situation.

Chapters

00:00 Introduction to Inherited IRA Rules
00:30 Understanding the 10-Year Rule
02:27 Exceptions to the 10-Year Rule
03:28 Tax Strategies for Inherited IRAs
05:21 Conclusion and Resources