Inherited IRA 10-Year Drawdown Calculator

Under the SECURE Act, most non-spouse beneficiaries must empty an inherited IRA within 10 years. This calculator compares three distribution strategies and their total income tax cost — so you can see which approach fits your specific bracket situation.

The three strategies explained

Strategy 1: Even distribution

Take approximately equal amounts each year — specifically, 1/N of your current balance where N is the years remaining. As the balance shrinks and grows with market returns, your annual distribution adjusts proportionally. This keeps your year-to-year income impact roughly stable and avoids bracket spikes. Best when your income will be similar throughout the 10-year window.

Strategy 2: Accelerated (front-loaded)

Take larger distributions early (this calculator uses 20% of the original balance per year), then smaller distributions from the remainder. This strategy captures more distributions in your current tax bracket rather than future ones. It makes sense when:

• Your income is lower now than it will be in several years (before a career peak, before selling a business)
• You expect future tax rates to increase
• You want to clear the IRA before a planned high-income year (Roth conversion, real estate sale)

Strategy 3: Deferred (delay until year 10)

Take nothing in years 1–9, letting the balance compound tax-deferred, then distribute everything in year 10. The IRA grows more in absolute terms, but the final distribution is large and often expensive — a $500K IRA earning 6% grows to ~$845K by year 10, all taxable in a single year. This strategy makes sense only when you expect dramatically lower income in year 10 than today (e.g., retirement).

2026 federal income tax brackets (ordinary income)

IRA distributions are added on top of your other income and taxed at ordinary rates. Knowing where your distribution lands in the brackets tells you the marginal cost per dollar:

Source: IRS Rev. Proc. 2025-32. OBBBA (One Big Beautiful Bill Act, July 2025) permanently extended the TCJA ordinary income rate structure with inflation adjustments. Standard deduction 2026: $16,100 (single) / $32,200 (MFJ).

Common inherited IRA scenarios

Scenario: $600K inherited IRA, single, $80K other income

With $80K in other income (single), you're solidly in the 22% bracket ($50,400–$105,700 threshold). An even distribution of ~$60K/year brings you to $140K — pushing into the 24% bracket for the portion above $105,700. Accelerating distributions to $120K/year would push to $200K, still in 24%. Deferring would result in a $1M+ year-10 distribution at 35–37% marginal rates. Result: even distribution wins by roughly $100–150K in lifetime taxes vs. the deferred strategy.

Scenario: $400K inherited IRA, MFJ, $60K other income, expecting retirement in 5 years

With $60K income (MFJ), you're in the 12% bracket ($24,800–$100,800 threshold). Even distributions of $40K/year keep you well within 12%. After retirement in year 5, your income may fall to $30K — making years 6–10 even cheaper for distributions. Result: a hybrid strategy (moderate distributions now, more after retirement) beats pure even or pure defer. This kind of year-by-year optimization requires a specialist's full-picture analysis.

Scenario: $1.2M inherited IRA, single, $250K W-2 income

With $250K income (single), you're in the 35% bracket before any IRA distributions. Every dollar distributed adds at 35–37% marginal cost. There's no "good" year to take $120K/year — all of it hits at 35%+. In this case, the even strategy and deferred strategy have similar effective rates; the key question is whether growth inside the IRA (tax-deferred) offsets the higher final-year tax hit. In high-income situations like this, Roth conversions, charitable strategies (QCD), and trust structures become more important than distribution timing alone.