How the 5-Year Rule Really Works With Inherited Roth IRAs

What You Need To Know

• If a client is at least 59.5 and five years have passed since their last contribution, all Roth IRA distributions become tax-free, including the earnings.
• While a typical Roth IRA is not subject to minimum distribution rules, inherited Roth IRAs are subject to the same RMD rules as traditional IRAs.
• When a surviving spouse is at least 59.5, the spousal rollover option is likely advantageous.