Schwab Inherited Ira Rmd Calculator

Navigating the complex rules of Required Minimum Distributions (RMDs) for inherited IRAs can be daunting—especially with changes introduced by the SECURE Act and its successors. Fortunately, our Inherited IRA RMD Calculator simplifies this process for beneficiaries, helping them quickly calculate how much they are required to withdraw each year based on their unique circumstances.

Whether you’re a spouse, non-spouse individual, or entity beneficiary, this intuitive tool gives you a tailored RMD estimate in seconds.

What Is an Inherited IRA RMD?

An Inherited IRA RMD is the minimum amount that a beneficiary must withdraw annually from an inherited Individual Retirement Account (IRA), as required by the IRS. The distribution rules vary significantly depending on the type of beneficiary and the dates of birth and death of the original IRA owner.

How to Use the Inherited IRA RMD Calculator

Using this calculator is straightforward and takes only a minute. Here’s how:

Step-by-Step Instructions

  1. Select Your Beneficiary Type
    Choose whether you’re a:
    • Spouse
    • Non-Spouse Individual
    • Entity (Estate, Charity, or Trust)
  2. Enter the Original IRA Owner’s Date of Birth
    This helps determine the owner’s Required Beginning Date (RBD) and applicable distribution rules.
  3. Enter the Original IRA Owner’s Date of Death
    The year of death impacts whether the 5-year or 10-year rule applies.
  4. Enter the Beneficiary’s Date of Birth
    Only required for individual (spouse or non-spouse) beneficiaries. The calculator dynamically hides this input if you choose “Entity.”
  5. Enter the Current IRA Account Value
    This figure will be used to estimate your RMD for the selected year.
  6. Select the Calculation Year
    This is the tax year for which you want to determine your RMD (default is the current year).
  7. Click “Calculate”
    Instantly receive your personalized RMD amount, deadline, a detailed explanation of the applicable rules, and a future distribution schedule if applicable.
  8. Review the Results
    The tool displays:
    • RMD Amount
    • Distribution Deadline
    • Rule Explanation
    • Optional RMD Schedule (if future distributions apply)
  9. Reset if Needed
    Click “Reset” to clear the form and enter new data.

Practical Example

Let’s say you’re a non-spouse beneficiary who inherited an IRA from your aunt who passed away in 2023. Your date of birth is January 1, 1980, and the account value as of December 31, 2024, is $150,000.

Here’s how you’d use the calculator:

  • Select Non-Spouse Individual
  • Enter your aunt’s DOB and DOD
  • Enter your own DOB (01/01/1980)
  • Enter account value: 150,000
  • Set the calculation year to 2025
  • Click “Calculate”

The calculator will analyze the 10-year rule and determine whether you need to take a distribution in 2025, including details on your eligibility for stretch distributions (if you’re a minor, disabled, etc.).

Why Use This Inherited IRA Calculator?

  • Saves Time: No need to parse IRS tables or legalese.
  • Accurate: Aligns with current IRS regulations and the SECURE Act provisions.
  • Educational: Provides a plain-English explanation for your distribution requirements.
  • Versatile: Handles all beneficiary types and calculates based on life expectancy, ownership status, and IRS guidelines.

Additional Information and Use Cases

  • Spouse Flexibility: Spouses can treat the IRA as their own or use inherited IRA rules.
  • 10-Year Rule: Applies to most non-spouse beneficiaries after the SECURE Act of 2019.
  • 5-Year Rule: Applies to entities if the IRA owner died before their RBD.
  • Stretch IRAs: Still possible for certain “Eligible Designated Beneficiaries” such as:
    • Minor children
    • Disabled individuals
    • Chronically ill individuals
    • Beneficiaries less than 10 years younger than the IRA owner

FAQs: Inherited IRA RMDs and Calculator

1. What is the Required Beginning Date (RBD)?
It’s the date when the original IRA owner was required to start RMDs, typically April 1 of the year after turning 72.

2. Who must take RMDs from inherited IRAs?
All non-charity beneficiaries, including spouses, unless they choose to treat the IRA as their own.

3. What’s the difference between a spouse and non-spouse beneficiary?
Spouses have more flexibility, including rolling over the IRA into their own. Non-spouses follow stricter distribution rules.

4. What is the 10-year rule?
Most non-spouse beneficiaries must fully distribute the IRA within 10 years of the original owner’s death.

5. Does the 10-year rule require annual RMDs?
No. Annual withdrawals aren’t required, but the full balance must be distributed by year 10.

6. Who qualifies as an Eligible Designated Beneficiary?
Minors, disabled/chronically ill individuals, and beneficiaries within 10 years of the decedent’s age.

7. Can an entity be an IRA beneficiary?
Yes—entities like estates or charities can inherit IRAs but often face the 5-year rule or use the decedent’s life expectancy.

8. What happens if I miss an RMD?
You may face a 25% IRS penalty (reduced to 10% if corrected promptly) on the missed distribution.

9. Do Roth IRAs have RMDs for beneficiaries?
Yes. Beneficiaries must still withdraw from inherited Roth IRAs, even though the withdrawals are tax-free.

10. How is the RMD calculated?
By dividing the account balance by a life expectancy factor, based on IRS tables.

11. What if the IRA owner died after their RBD?
Different rules apply, often allowing distributions based on the decedent’s remaining life expectancy.

12. Do I need to take RMDs in the year of the IRA owner’s death?
No. The first RMD is due the year after the death.

13. Can I convert an inherited IRA to a Roth IRA?
No. Inherited IRAs cannot be converted to Roth IRAs by beneficiaries.

14. What is the 5-year rule?
Requires complete distribution within 5 years if the owner died before their RBD and the beneficiary is an entity.

15. How do minor children handle RMDs?
They can use life expectancy calculations until age 21, then switch to the 10-year rule.

16. How does the tool handle stretch IRA calculations?
It uses life expectancy tables to compute RMDs if you’re an eligible designated beneficiary.

17. Are my inputs stored or tracked?
No—calculations are performed in-browser. No data is transmitted or saved.

18. Can I use this for inherited 401(k)s?
Yes, but keep in mind that plan-specific rules might also apply.

19. What if I inherited multiple IRAs?
Each IRA must be calculated separately unless they’re of the same type and can be aggregated.

20. Does this tool comply with the SECURE Act 2.0?
Yes. It is updated to reflect the latest IRS rules including the SECURE Act and its amendments.

Start Your Calculation Today

If you’ve inherited an IRA and need to figure out your next move, this calculator gives you clarity fast. It’s free, fast, and reliable—perfect for planning your RMD strategy with confidence.