The IRS’s new rules on inherited IRA accounts may leave beneficiaries with large tax bills from next year if they do not fulfill withdrawal conditions set out by the agency.
An inherited IRA is an individual retirement account opened when a someone inherits an IRA plan, and assets are moved from the original owner’s IRA to the new account. Beneficiaries of such inherited IRAs have to pay taxes on these accounts. Before 2020, taxes could be minimized by beneficiaries through stretching out withdrawals across their estimated life expectancies.
