When an IRA owner dies, their Required Minimum Distribution obligation doesn't die with them. If the owner owed an RMD for the year they died and hadn't yet taken it, that distribution still needs to happen. Someone has to take it — and in most cases, that someone is the beneficiary.
This is the part of the inherited IRA process that has to happen first, before anything else — before the 10-year clock, before beneficiary RMDs, before any long-term distribution planning. It's also the part most people don't know about until a custodian or tax professional brings it up.
In short: If an IRA owner dies during a year in which they owed an RMD but hadn't fully taken it, the shortfall must still be distributed by December 31 of that year. The beneficiary is responsible for taking it, and it's taxable income to whoever receives it. This is the owner's final obligation — separate from the beneficiary's own distribution schedule, which begins the following year.
On this page
- The Year-of-Death RMD: Who Owes It?
- Four Scenarios: What Happens Depending on When the Owner Died
- Example: Grace and Her Father's Final RMD
- After the Year-of-Death: When Your Schedule Begins
- The Practical Steps (In Order)
- Common Mistakes
- Frequently Asked Questions
RMDs after death — year-of-death handoff timeline from owner's final RMD to beneficiary's distribution schedule
The Year-of-Death RMD: Who Owes It?
If the original IRA owner had reached their Required Beginning Date and owed an RMD for the year they died, that RMD must be completed. The IRS does not forgive or prorate it because the owner died partway through the year. The full amount for the year is due.
Who takes it? The beneficiary. Once the account passes to you, you're responsible for ensuring the owner's final-year RMD is distributed by December 31 of the year of death. The distribution comes out of the inherited IRA and is reported as taxable income to you (or split among multiple beneficiaries, if applicable).
If the estate is the beneficiary, the estate takes the distribution and reports it on the estate's tax return. In cases where the account hasn't been retitled yet and the custodian won't process a distribution to the beneficiary directly, the executor may need to coordinate the withdrawal.
The year-of-death RMD uses the owner's calculation — not yours. It's based on the owner's age, the owner's prior year-end balance, and the table the owner would have used (typically the Uniform Lifetime Table). This is the deceased owner's RMD that simply hasn't been taken yet. Your own beneficiary distribution schedule begins the following year.
One detail that helps: any distribution the owner took during the year of death counts toward their RMD, regardless of how it was labeled. If the owner withdrew money for personal spending in March and died in August, that withdrawal reduces the remaining RMD shortfall.
Source: IRS Publication 590-B — Death of account owner
Four Scenarios: What Happens Depending on When the Owner Died
Not every death triggers a year-of-death RMD. It depends on the owner's age and whether they'd already taken their distribution.
| Scenario | Year-of-Death RMD Required? | What Happens Next |
|---|---|---|
| Owner died after RBD, had already taken their full RMD for the year | No — already satisfied | Beneficiary's schedule starts the following year |
| Owner died after RBD, had not yet taken their RMD for the year | Yes — remaining amount must be distributed by Dec. 31 | Beneficiary takes the shortfall, then their own schedule starts the following year |
| Owner died after RBD, had taken a partial RMD | Yes — the remaining shortfall must be distributed by Dec. 31 | Beneficiary completes the difference |
| Owner died before RBD (hadn't started RMDs) | No — no RMD was owed for the year | Beneficiary's 10-year clock (or stretch) starts the following year |
The first scenario is the simplest — and it's more common than people expect. Many retirees take their RMD early in the year, so by the time they pass, the obligation is already met.
In all cases where a year-of-death RMD is owed, the distribution is reported as taxable income on the recipient's return — the beneficiary's 1040 if they take it directly, or the estate's 1041 if the estate is the beneficiary.
Example: Grace and Her Father's Final RMD
Grace's father, Robert, was 78 years old. He had a Traditional IRA with a December 31, 2024 balance of $410,000. Robert's RMD for 2025, calculated using the Uniform Lifetime Table, was $18,303 (factor of 22.4).
Robert died in August 2025. He had withdrawn $10,000 from the IRA earlier in the year, but that withdrawal was for personal spending — he hadn't formally designated it as his RMD. Fortunately, it doesn't matter: the IRS treats any distribution during the year as counting toward the RMD, regardless of how the owner labeled it.
That means $8,303 of Robert's 2025 RMD remains unsatisfied ($18,303 minus $10,000).
Grace is the sole beneficiary. She must ensure that $8,303 is distributed from the inherited IRA by December 31, 2025. The distribution is taxable income to Grace on her 2025 return.
Here's what Grace's timeline looks like:
| When | What Happens |
|---|---|
| August 2025 | Robert dies. Grace notifies the custodian. |
| September–November 2025 | Account is retitled as inherited IRA. Grace verifies the year-of-death RMD shortfall with the custodian. |
| By December 31, 2025 | Grace takes (or confirms) the remaining $8,303 distribution. |
| 2026 (Year 1) | Grace's own distribution schedule begins. Because Robert had passed his RBD, annual RMDs are required in years 1–9 under the 10-year rule. Her 2026 RMD uses her age and the Single Life Expectancy Table — a different calculation from Robert's final-year RMD. |
| By December 31, 2035 | Account must be fully emptied. |
We see people get tripped up here because they're focused on the long-term question — "Am I on the 10-year rule?" — and they overlook the immediate one. The year-of-death RMD comes first.
After the Year-of-Death: When Your Schedule Begins
Once the owner's final-year RMD is satisfied (or if none was owed), your own distribution schedule starts the year after the owner's death. This is "Year 1" of your timeline.
If the owner died after their RBD: You owe annual RMDs in years 1 through 9, calculated using the Single Life Expectancy Table based on your age. The account must be empty by the end of year 10. For the math: Inherited IRA RMD tables explained
If the owner died before their RBD: No annual RMDs are required. You have full flexibility on timing within the 10-year window. The account must be empty by December 31 of year 10.
If you're an eligible designated beneficiary (surviving spouse, minor child, disabled/chronically ill, or not more than 10 years younger than the deceased): You may qualify for life expectancy-based stretch distributions instead of the 10-year rule. See: Inherited IRA RMD rules
The year-of-death RMD and your first beneficiary RMD are two separate obligations. They use different tables, different calculations, and serve different purposes. The year-of-death RMD closes out the owner's account. Your beneficiary RMD begins your own schedule.
The Practical Steps (In Order)
If you've inherited an IRA and need to figure out what to do right now, here's the sequence. Not every step applies to every situation, but this is the general order.
1. Obtain the death certificate. The custodian will require a certified copy before they can retitle the account or process any distributions. If you're waiting on the certificate, notify the custodian by phone in the meantime — they can begin the process and flag the account.
2. Notify the custodian. Call the institution that holds the IRA and inform them of the owner's death. They'll walk you through their process for retitling the account.
3. Get the account retitled. The inherited IRA must be held in the deceased owner's name with you listed as beneficiary. Your custodian handles the paperwork. Don't skip this — an improper retitling can trigger unintended tax consequences.
4. Determine whether a year-of-death RMD is owed. Ask the custodian: did the owner have an RMD for the year of death, and how much (if any) was already taken? If a shortfall exists, you need to distribute it by December 31 of the year of death.
5. Take the year-of-death RMD (if owed). Request the distribution from the custodian. Decide on withholding. This is taxable income to you.
6. Determine your beneficiary classification. Are you a designated beneficiary (10-year rule) or an eligible designated beneficiary (possible stretch)? Your classification determines everything that follows. See: Non-spouse beneficiary RMD rules
7. Determine whether annual RMDs are required. Had the owner reached their Required Beginning Date? If yes, you owe annual distributions in years 1–9. If no, you have flexibility within the 10-year window.
8. Plan your distribution schedule with a tax professional. This is where strategy enters — and it's a conversation for your CPA, not a calculator. SimpleRMD can show you the required amounts and generate a report to bring to that meeting.
Want to see your numbers? Try the inherited IRA calculator — free, no signup required.
Common Mistakes
Not knowing a year-of-death RMD exists. Many beneficiaries focus on the 10-year rule and miss the immediate obligation. If the owner owed an RMD and hadn't fully taken it, that distribution must happen by December 31 — regardless of anything else.
Missing the December 31 deadline for the year-of-death RMD. Processing takes time, especially if the account is being retitled simultaneously. If the owner died late in the year (October, November, December), the window is tight. Contact the custodian immediately.
Confusing the year-of-death RMD with the beneficiary's first RMD. These are separate obligations. The year-of-death RMD uses the owner's age and table. The beneficiary's first RMD (starting the following year) uses the beneficiary's age and the Single Life Table. Don't use the wrong calculation.
Assuming a Roth IRA owner has a year-of-death RMD. Roth IRA owners are never subject to lifetime RMDs, so there's no year-of-death RMD to satisfy. The beneficiary's 10-year clock simply starts the following year. See: Roth IRA RMD rules
Assuming the year-of-death RMD is prorated. It isn't. If the owner died in February, the full annual RMD is still owed — the IRS doesn't reduce it based on how many months the owner was alive. This surprises people, but the rule is clear.
Not coordinating among multiple beneficiaries. If three siblings inherit equal shares, the year-of-death RMD can be split proportionally — but someone needs to make sure it actually gets done. The IRS doesn't care about family logistics; it cares about the deadline.
Frequently Asked Questions
Is the year-of-death RMD taxable to the beneficiary or the deceased?
To the beneficiary. The distribution is reported on the beneficiary's tax return, not the deceased owner's final return — unless the estate is the beneficiary, in which case it's reported on the estate's return (Form 1041).
What if the owner died in January — is the full annual RMD still owed?
Yes. The IRS does not prorate RMDs based on the date of death. If the owner owed an RMD for the year and hadn't taken any of it, the full amount must be distributed by December 31. The timing of death within the year doesn't reduce the obligation.
What if the owner died in their first RMD year and had delayed to April 1?
This is a tricky situation. If the owner was in their first RMD year and had elected to delay until April 1 of the following year, but died before that April 1 date, the delayed first-year RMD is still owed. The beneficiary must take it by the original April 1 deadline. The beneficiary may also owe the year-of-death RMD for the second year, depending on when the owner died. Talk to a tax professional about the exact timeline. Related: First-year RMD rules
Does the year-of-death RMD count toward the 10-year rule?
No. The year-of-death RMD is the owner's obligation, not the beneficiary's. The 10-year clock starts the year after the owner's death. They're separate.
What if I can't get the account retitled before December 31?
Contact the custodian and explain the situation. Many custodians can process the year-of-death distribution even while the retitling is in progress. If there's a delay, document your efforts — this is the kind of reasonable cause that supports a penalty waiver if the deadline is missed. See: IRS waiver for missed RMDs
What if there are multiple beneficiaries?
The year-of-death RMD can be split proportionally among the beneficiaries. Each person reports their share as taxable income on their own return. For example, if three siblings each inherit a third, each is responsible for a third of the remaining year-of-death RMD. Coordinate early — one person's inaction can create complications for everyone.
Need to check your inherited IRA numbers?
- Run the inherited IRA calculator — free, no account required
- Inherited IRA RMD rules
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- RMD deadlines and penalties
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This article is for informational purposes only and does not constitute tax, legal, or financial advice. IRS rules and tax laws are subject to change. Consult a qualified tax professional or financial advisor for guidance specific to your situation. SimpleRMD is a calculation and tracking tool — not a financial advisory service.
Sources: IRS.gov (Publication 590-B, Pub 590-B PDF, RMD FAQs). IRS Final Regulations T.D. 10001 (July 2024). SECURE Act of 2019 (Pub. L. 116-94). Rules confirmed current as of February 2026.