Q&A: Inherited Roth IRA distributions

Dear Liz: You recently answered a question about whether someone should use a Roth IRA to pay off a mortgage. In your answer, you mentioned the requirement to take minimum distributions from the account. One of the huge advantages of a Roth, besides tax-free distributions, is that there are no required minimum withdrawals. Did I miss something?

Answer: You did. You missed the word “inherited.”

The letter writer was asking whether to use an inherited Roth IRA to pay off the mortgage. (Specifically, an inherited non-spousal Roth IRA.) Although the original Roth IRA owner was not required to take distributions, the heirs must. Money can’t be kept in tax-deferred retirement accounts indefinitely.

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