Who Can Still Stretch an Inherited IRA? (2026 Guide)

The 10-year rule and who is exempt from it

A 2019 law reshaped who gets to stretch an inherited IRA and who does not. If the original IRA owner or plan participant died on or after January 1, 2020, most heirs who are named directly as beneficiaries now have to withdraw the entire account within 10 years of that death. Inside the industry this is called the 10-year rule, and it applies whether you take nothing for nine years and empty the account in year 10, or spread withdrawals evenly across the decade.

That 10-year rule is the default for most people who inherit an IRA today. But the same law carved out five categories of heir, called eligible designated beneficiaries, who can skip the 10-year rule and stretch distributions over their own life expectancy instead:

1. A surviving spouse. Nothing changes for a spouse. They can roll the IRA into their own name or stretch it exactly as they could before this law existed.
2. A minor child of the original owner. A minor child can stretch payments, but only while they are still a minor. Once they reach the age of majority, the 10-year clock starts running on whatever balance is left.
3. A beneficiary who is disabled. This uses a specific, strict federal definition: someone unable to engage in any substantial gainful activity because of a physical or mental condition.
4. A beneficiary who is chronically ill. This means someone unable to perform at least two activities of daily living on their own, a standard borrowed from long-term care insurance.
5. A beneficiary not more than 10 years younger than the original owner. A sibling close in age to the deceased is the most common example.

Once an eligible designated beneficiary passes away, the 10-year rule catches up with whoever inherits from them next. The same is true for IRAs that were grandfathered in under the older stretch rules before 2020: when that original beneficiary dies, their successor gets 10 years to finish emptying the account, not a fresh lifetime stretch.

Beneficiaries that are not people at all, meaning an estate or most trusts, fall under an even older and tighter rule: the account has to be emptied within 5 years. Two exceptions soften that. A trust drafted to meet the IRS's "see-through" requirements can use the 10-year rule instead of the 5-year rule. And if a see-through trust's only beneficiary is one of the five eligible designated beneficiaries described above, that trust can still stretch distributions over that person's life expectancy.

What is the SECURE Act?

The Setting Every Community Up for Retirement Enhancement Act, known as the SECURE Act, became law on December 20, 2019, tucked inside a larger year-end government funding bill. It is widely considered the biggest piece of retirement legislation since the Pension Protection Act of 2006, and the 10-year inheritance rule above is its most consequential change for people who plan to leave an IRA to their heirs.

How the SECURE Act changed the rules for IRA owners, not just heirs

Beyond the inheritance rules, the SECURE Act changed several things for people still building and drawing down their own retirement accounts, mostly in ways that gave savers more room:

• It removed the old age cap on IRA contributions. Before this law, you could not contribute to a traditional IRA past age 70 and a half. Now anyone with earned income, or a spouse with earned income, can contribute at any age.
• It pushed back the age required minimum distributions have to start. Anyone who had not yet turned 70 and a half by the end of 2019 got their RMD start age moved to 72. A later law, SECURE 2.0, pushed that further to 73, with another step up to 75 arriving in 2033.
• You can still make a qualified charitable distribution once you turn 70 and a half, but the SECURE Act added a wrinkle: any deductible traditional IRA contribution you make that same year now shrinks how much of your QCD counts toward the exclusion.
• A new penalty-free withdrawal became available for a birth or adoption: up to $5,000 from an IRA or workplace plan within one year of the event, exempt from both the 10% early withdrawal penalty and the 20% mandatory withholding that applies to plan withdrawals.
• The definition of qualified higher education expenses for 529 plan withdrawals was expanded to cover the cost of registered apprenticeship programs and the repayment of student loans, categories that were not allowed uses before.

If you are the one holding the IRA rather than the one who inherited it, talk with a tax professional about how these changes affect your own contribution and withdrawal plans, since your beneficiary designations may need a second look under the new rules.

The SECURE Act at a glance

• It passed with broad, bipartisan support in both the House and the Senate.
• Its biggest changes benefited employer-sponsored retirement plans, not just IRAs, by giving plan sponsors more room to add lifetime income options such as annuities inside a 401(k) or similar plan.
• It made it easier for small businesses to band together into multi-employer plans, added tax credits to encourage new plans, and made automatic enrollment easier to adopt.
• It gave IRA owners more flexibility on both contributions and required minimum distributions.
• It opened new penalty-free withdrawal categories: a birth or adoption withdrawal from IRAs and workplace plans, and new allowed uses for 529 plan money.
• Its biggest cost to heirs was the loss of the lifetime stretch for most beneficiaries, replaced by the 10-year rule described above.

If you are naming beneficiaries on an IRA, 401(k) or any other qualified account, it is worth reviewing those designations with a tax professional to confirm they still accomplish what you want under these rules.