When Does a Surviving Spouse Have to Withdraw an Inherited 401(k)?

A surviving spouse who inherits a 401(k) is an eligible designated beneficiary: the spouse may take withdrawals over life expectancy and, as the sole beneficiary, delay the first until the year the owner would have reached the applicable age or roll the account into the spouse's own IRA; a missed amount carries a 25% tax.

Account Type

Traditional IRA

Includes SEP and SIMPLE IRAs

Roth IRA

Employer plan

401(k), 403(b), or governmental 457(b)

Account Owner's Date of Birth (MM/DD/YYYY)

Account Owner's Date of Death (MM/DD/YYYY)

Your Relationship to the Owner

Surviving spouseChild of the owner

Another individual

Grandchild, sibling, partner, friend

A trust

The account names a trust as beneficiary

Estate or charity

No individual is named, or a charity is

See which withdrawal rules apply

Select the account type, enter the owner's dates of birth and death, and answer the questions about your relationship to the owner.

Examples:

Deadline year by which the account must be emptied

Annual withdrawals and whether they are required

First-year dates and the tax for a missed withdrawal

General information about the federal distribution rules for an inherited retirement account, not tax or legal advice. The rules are applied as written in the Internal Revenue Code, the Treasury regulations and IRS guidance to the answers given. Plan documents, state income tax and facts not asked here can change the outcome. Consult a licensed tax professional for tax questions.

Yes. A distribution from an employer plan paid to the surviving spouse after the employee's death is treated for the rollover rules as if the spouse were the employee. The statute also lets a surviving spouse elect to be treated as the employee; the regulation writes that election as a plan provision and reserves its mechanics, and a proposed rule to fill them in was pending when these rules were verified.

A surviving spouse who is the sole beneficiary may delay the start of life expectancy payments until the end of the calendar year in which the owner would have reached the applicable age. If the spouse dies before distributions begin, the rules are applied as if the spouse were the owner, with the spouse's date of death substituted.

Five classes, determined as of the owner's date of death: the surviving spouse; a child of the owner under the age of majority, which the regulation sets at the 21st birthday; a disabled individual; a chronically ill individual; and an individual not more than 10 years younger than the owner. An eligible designated beneficiary may take annual life expectancy payments instead of emptying the account within a fixed period.

Yes. A defined contribution plan may specify that the 10-year rule applies to some or all eligible designated beneficiaries, or may let the employee or beneficiary elect between the 10-year rule and life expectancy payments. When the plan has no such provision, an eligible designated beneficiary takes life expectancy payments. The plan document decides.

25% of the amount that should have been withdrawn but was not, paid by the beneficiary. The rate drops to 10% when the missed amount is withdrawn from the same plan and a return reflecting the tax is filed, both inside the correction window, which ends at the earliest of a notice of deficiency, an assessment, or the last day of the second taxable year after the year the tax applies to. The IRS may waive the tax for reasonable error on a Form 5329 request, and the regulation waives it automatically in two cases.