If I am already well into the highest tax bracket and will be for the next ten+ years, and if I am inheriting a sizable IRA... do you suggest cashing out (with the tax hit) so I can grow it with diversity and flexibility or do I stretch and just take RMDs until I am required to empty it? I feel like I am getting biased advice from the institution.

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Sorry for your loss.

Keep it in the inherited IRA. No matter what, you’ll have to pay income tax as a % of the account. If you withdraw now, you’ll also pay capital gains on any earnings future earnings, so tax deferral is better.

Btw if the decedent passed in 2020/2021, you may be able to skip RMDs and wait 10 years to withdraw. Consult with a tax advisor for guidance on that

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Move from ira to roth and pay the taxes from your savings. No need of RMD and you can use it after 5 years if you need to or at your old age or pass it tax free to your kids

It doesn’t work like that unless you inherit from a spouse. Don’t know the facts here

More info - no capital gains and rmds are required next year because they were already being drawn. What is the benefit if any of stretching in inherited ira

Deferring the tax is the benefit. If tax was 0% today, you’d obviously pull out. If tax was going to 0% next year, you’d wait. So depends on what bracket you’re in and what congress is ultimately going to do this year, next year, and in the general future. Good luck playing that game if you want to try

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