A Roth IRA owner can let the account grow untouched for the rest of their life, since federal tax law never forces a withdrawal the way it does with a traditional IRA or most employer retirement plans. That single feature sets a Roth IRA apart from almost every other tax-advantaged retirement account, most of which require the owner to start pulling out a calculated minimum amount every year once they reach a certain age, whether or not the money is needed. Someone who doesn’t need the income can instead leave the full balance compounding, tax-free, for as long as they live. That distinction between contributions and earnings is also why two people with identical account balances can face very different tax bills on the exact same size withdrawal.
No Required Withdrawals for as Long as the Owner Is Alive
The IRS states plainly that Roth IRA owners are not required to take withdrawals from the account while they are alive, a rule that has applied since Congress created the Roth IRA in 1997. A required minimum distribution, or RMD, is the smallest amount an account owner must withdraw each year once they reach the applicable age, calculated by dividing the account balance by a life-expectancy factor from an IRS table. A Roth IRA owner never has to run that calculation or take that withdrawal, no matter how large the account grows or how old the owner gets.
Traditional IRAs, SEP IRAs, SIMPLE IRAs, and most employer retirement plans require the owner to start taking RMDs by April 1 of the year after they turn 73, and every year after that the withdrawal is due by December 31. Skipping or shorting an RMD on one of those accounts carries a real cost: the IRS can charge a 25% excise tax on the amount that should have been withdrawn but wasn’t, cut to 10% if the shortfall is corrected within two years. A Roth IRA owner never faces that penalty, because there is no required withdrawal to miss in the first place.
Avoiding RMDs also helps control taxable income in retirement, since a large mandatory withdrawal from a traditional account can push a retiree into a higher tax bracket, raise Medicare Part B and Part D premiums through the income-related surcharge, or make a larger share of Social Security benefits taxable. Because Roth IRA withdrawals are optional and, when qualified, tax-free, an owner can choose to take money only in a year it actually helps rather than being forced into a withdrawal that inflates their income when the cash isn’t needed. That flexibility is often most valuable in the years just after retirement, before Social Security and any pension income are locked in.
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The Account Can Keep Growing for Decades, Not Just Dodge a Penalty
IRS guidance on Roth IRAs confirms an owner can leave money in the account for as long as they live, and can keep contributing to it past age 70 1/2 as long as they have qualifying income and stay under the contribution income limits. That combination lets a Roth IRA function as a multi-decade compounding vehicle in a way a traditional IRA generally can’t match once RMDs begin and start shrinking the balance every year, regardless of market performance or the owner’s actual spending needs.
Financial advisors often point to this feature as a reason some retirees convert part of a traditional IRA into a Roth IRA well before RMD age, since money moved into a Roth IRA and left there long enough is no longer subject to the withdrawal schedule that otherwise forces traditional-account owners to draw down savings on the government’s timeline instead of their own. The trade-off is that a Roth conversion is a taxable event in the year it happens, which is why the RMD exemption tends to pay off over the long run rather than immediately.
Death Changes the Math for Whoever Inherits the Account
The lifetime exemption from RMDs does not carry over to whoever inherits the Roth IRA. The IRS generally applies the same distribution framework to an inherited Roth IRA that it applies to an inherited traditional IRA, meaning most beneficiaries who are not the owner’s spouse must empty the account within 10 years of the owner’s death rather than stretching withdrawals across their own lifetime. A surviving spouse has more flexibility and can roll the inherited account into a Roth IRA in their own name, which resets the no-RMD treatment for as long as that spouse lives.
Money coming out of an inherited Roth IRA is still generally tax-free, since withdrawn contributions are never taxed and withdrawn earnings usually aren’t either. The exception is timing: if the Roth IRA was less than five years old when the original owner died, earnings distributed to a beneficiary can still be subject to income tax even though the account carries the Roth label, which is why the age of the account matters almost as much as who inherits it. That combination, tax-free growth for the original owner and, in most cases, tax-free income for whoever inherits it, is part of why financial planners often describe a Roth IRA as a legacy tool as well as a retirement account.
This article was produced with the assistance of AI and reviewed by The Money Overview editorial team before publication.
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