Five-Year Rule

Five-Year Rule
If a retirement account owner dies before the required beginning date for receiving distributions, the beneficiary may distribute the inherited assets over his/her (the beneficiary’s) life expectancy or distribute the assets under the five-year rule. Under the five-year rule, the assets must be distributed by December 31 of the fifth year since the retirement account owner's death.
The five-year rule does not apply if the IRA owner dies after the required beginning date (RBD).
Inherited Retirement Plan Assets - Part 1 - If you're a beneficiary of a retirement account, you should know your distribution options. Inherited Retirement Plan Assets - Part 2 - To take full advantage of new RMD regulations, beneficiaries need to take action before important deadlines. Who Is The Beneficiary Of Your Account? - If you've experienced life changes since first establishing your plan, it might be time to update the designations.