SECURE 2.0 10-Year Rule
A rule (originating in the SECURE Act and refined by SECURE 2.0) requiring most non-spouse heirs who inherit an IRA or 401(k) to withdraw the entire balance within 10 years of the original owner's death. It largely replaced the old 'stretch IRA,' under which an heir could spread withdrawals across their own life expectancy. Because withdrawals from an inherited Traditional account are taxed as ordinary income, spreading them across the decade usually beats taking a lump sum. Spouses who inherit have more flexible options.
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Related terms
Adjusted Cost Basis · Annuity · Capital Gains Distribution · Capitalized Interest · Cost Basis · Dividend Discount Model (DDM)
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