Inherited IRA Calculator 2026 β 10-Year Distribution Strategy
Calculate the optimal distribution strategy for your inherited IRA. Compare equal, back-loaded, and bracket-filling strategies to minimize taxes over the 10-year window.
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Wages, SS, pension β before IRA distributions %
$0
Total Tax (10 Years)
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Annual Distribution
0%
Effective Rate on IRA
Equal
Strategy
Year-by-Year Distribution & Tax Schedule
| Year | Begin Balance | Growth | Distribution | End Balance | Tax on Dist. |
|---|---|---|---|---|---|
| Totals | β | ||||
How to Use This Inherited IRA Calculator
Enter the inherited IRA balance, your age, your other annual income, and choose a distribution strategy. The calculator shows the tax impact of each distribution over the 10-year SECURE Act window by stacking IRA distributions on top of your other income using 2026 federal tax brackets.
How Tax Is Calculated
Each year: Taxable Income = Other Income + IRA Distribution β Standard Deduction
Tax = bracket-stacked computation on taxable income
Tax on Distribution = Tax(Other Income + Distribution) β Tax(Other Income only)
Effective Rate = Total 10-Year Tax / Total 10-Year Distributions
Tax = bracket-stacked computation on taxable income
Tax on Distribution = Tax(Other Income + Distribution) β Tax(Other Income only)
Effective Rate = Total 10-Year Tax / Total 10-Year Distributions
Strategy Comparison Overview
- Equal Annual: Divide balance by 10, distribute evenly. Predictable, avoids surprises.
- Back-Loaded: Let balance grow for 9 years, take everything in year 10. Maximizes growth but creates a large taxable event.
- Bracket-Filling: Take larger distributions in years with lower income, fill tax brackets efficiently. Usually the lowest total tax.
Example
$250,000 inherited IRA, other income $60,000, single, 6% return:
Equal strategy: ~$27,793/yr, likely in 22% bracket on distributions β total tax ~$45,000
Back-loaded: ~$398,000 in year 10, pushes into 35%+ bracket β total tax ~$80,000+
Bracket-filling: optimize to stay in 22% bracket β total tax ~$40,000
Savings from optimization: $5,000β$40,000 depending on strategy
Equal strategy: ~$27,793/yr, likely in 22% bracket on distributions β total tax ~$45,000
Back-loaded: ~$398,000 in year 10, pushes into 35%+ bracket β total tax ~$80,000+
Bracket-filling: optimize to stay in 22% bracket β total tax ~$40,000
Savings from optimization: $5,000β$40,000 depending on strategy
Extended
Strategy Comparison Table
Compare equal annual, back-loaded year 10, and optimized bracket-filling strategies side-by-side
Three-column comparison showing total tax for each distribution strategy. Uses the IRA balance, income, and return rate entered above.
10-Year Distribution & Tax β All Three Strategies
| Year | Equal Dist. | Equal Tax | Back-Load Dist. | Back-Load Tax | Bracket-Fill Dist. | Bracket-Fill Tax |
|---|---|---|---|---|---|---|
Frequently Asked Questions
What is the 10-year rule for inherited IRAs?
Under the SECURE Act (effective 2020), most non-spouse beneficiaries who inherit an IRA must fully distribute the account within 10 years of the original owner's death. This replaced the old "stretch IRA" strategy. The 10-year clock starts the year after the original owner dies. There is no requirement for how distributions are spread within those 10 years β but the entire balance must be withdrawn by the end of year 10.
Who is exempt from the 10-year rule?
Eligible Designated Beneficiaries (EDBs) are exempt from the 10-year rule and can use the old "stretch IRA" method based on their life expectancy. EDBs include: surviving spouses, minor children of the original owner (until they reach the age of majority), disabled individuals, chronically ill individuals, and beneficiaries not more than 10 years younger than the original owner.
Do I have to take RMDs every year during the 10-year period?
This depends on whether the original owner had reached their Required Beginning Date (RBD, age 73) at the time of death. If the owner died before RBD, non-spouse beneficiaries only need to empty the account by year 10 with no annual RMDs required. If the owner died on or after RBD, beneficiaries must take annual RMDs each year AND still empty the account by year 10.
What is the best strategy for distributing an inherited IRA?
The optimal strategy depends on your other income. If you have low income in some years, take larger distributions then to fill lower tax brackets. If your income is consistently high, equal annual distributions spread the tax burden evenly. Delaying and taking a lump sum in year 10 is usually the worst strategy because it creates a large taxable event in a single year, potentially pushing you into the highest bracket.
Can I roll an inherited IRA into my own IRA?
Only a surviving spouse can roll an inherited IRA into their own IRA. All other beneficiaries must keep the assets in an "inherited IRA" account and cannot roll it into their personal IRA. The inherited IRA must remain titled with the deceased owner's name and your name as beneficiary.