If you’ve inherited an IRA from someone other than your spouse, the rules for taking money out are about to change — and it could affect your taxes.

Starting in 2025, the IRS will require many heirs to take annual withdrawals (called required minimum distributions, or RMDs) from inherited IRAs. On top of that, the account must still be completely emptied within 10 years.

This mainly impacts non-spouse beneficiaries — often adult children — when the original account holder had already started RMDs before they passed away. Miss a withdrawal, and the IRS could hit you with a 25% penalty. Fix it within two years, and the penalty drops to 10%, and in some cases, the IRS may waive it entirely.

So, what does this mean for you? Planning matters more than ever. Pulling money out each year can push you into a higher tax bracket, so experts suggest thinking strategically: sometimes it’s smarter to take bigger withdrawals earlier, especially in years when your income is lower.

Before the SECURE Act in 2019, heirs could stretch IRA withdrawals across their lifetime, which kept taxes lower year by year. But now, most non-spouse heirs have to stick to the 10-year deadline. For the last few years, many people skipped yearly withdrawals because the IRS hadn’t clarified the rules. That’s no longer the case — starting in 2025, annual RMDs are officially required.

Bottom line: If you inherit an IRA, don’t wait until the last few years to pull the money out. Spreading withdrawals across the full 10-year window — and timing them around your income — can help minimize the tax hit.