When you pass away, your Roth IRA can be inherited by your beneficiaries. Spouses who inherit can treat the account as their own, continuing the tax-free growth. Non-spouse beneficiaries, however, must generally withdraw the funds within 10 years under current IRS rules.
The good news is that withdrawals for beneficiaries are still tax-free, provided the account met the five-year rule. This makes Roth IRAs a valuable estate planning tool, allowing you to pass on wealth without saddling heirs with tax burdens.
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