If you’ve recently lost a loved one and inherited their IRA, you might feel like you’re trying to read a map where the roads are still being paved. Between the SECURE Act of 2019 and new IRS regulations finalized for 2025 and 2026, the “old way” of doing things is officially a memory.
To make sense of it all, let’s look at an example:
Let’s say you inherited a Traditional IRA from your father, who passed away in 2024 at age 75. Because he was already taking RMDs, you must take annual RMDs during your 10-year window.
Here is the data you need for the 2026 calculation:
-Account Balance: The value of the inherited IRA on December 31, 2025. Let’s assume it was $200,000.
-Your Age: Your age on December 31, 2026. Let’s say you are 50 years old.
-The IRS Table: You use IRS Table 1 (Single Life Expectancy).
Step 1: Find Your “Base” Factor. First, the IRS looks at your age in the year after the owner died (2025). In 2025, you were 49. According to Table 1, the life expectancy factor for a 49-year-old is 37.1.
Step 2: Adjust for 2026. For every year after that first year, you don’t look at the table again. Instead, you subtract one from your initial factor.
2025 Factor: 37.1
2026 Factor: 37.1 – 1 = 36.1
Step 3: Do the Math, divide your 2025 year-end balance by your 2026 factor: 36.1
$200,000 = $5,540.17
Your 2026 Required Minimum Distribution would be $5,540.17
Why this matters for 2026, If you skip that $5,540.17 withdrawal in 2026, the IRS penalty is 25%. That means you would owe the government $1,385.04 just for forgetting to click “transfer”—and you’d still have to take the distribution and pay income tax on it!
Pro Tip for 2026
The “10-year rule” is still in effect. Even though you are taking these small annual RMDs, the entire remaining balance of that account must be $0 by December 31 of the 10th year (in this case, 2034). Most people choose to take out a bit more than the minimum each year to avoid a massive tax bill in Year 10.
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