An inherited IRA is a valuable part of many retirement plans. Such an inheritance can jump-start your own retirement accounts or supercharge them during the later parts of your working life. But with new rules related to inherited IRAs being passed, how should your plans adjust to maintain the best results? Here are a few key things to do.

1. Draw from the Inherited IRA First. The SECURE Act requires that inherited IRAs be completely drained within 10 years of acquiring them. This is a big change from the old rules, where you could simply add this IRA into your pool of retirement funds and treat it roughly the same. So your best bet if you are close to or already at retirement age is to use this money first since it has the shortest deadline and a big potential tax bite if you wait. 

2. Start Taxable Savings. Your retirement funds don't have to come solely from tax-advantaged accounts. If you must withdraw money from the inherited IRA, use it to fund a taxable retirement investment account. You've already paid the taxes, so this money will be available with no restrictions — meaning you can hold it for as long as you like and will not have required minimum distributions.

3. Withdraw Annually. There are no required minimum distributions for inherited IRA accounts under the SECURE Act. Instead, you must simply withdraw it all by the 10th year. But if you wait, you face a huge tax problem when you have to take it all at once. Do yourself a favor and withdraw an amount annually — no matter whether it's equal to 1/10th of your balance or a tailored amount. 

4. Do Tax Planning. If you aren't already working with a financial planner, this is the time to start. Those with a significant inherited IRA balance or who expect to receive one in the future should start planning how they will minimize taxes now. You have many options, such as timing distributions in ways to keep your taxable income lower or in lower tax brackets each year. But these options require advance planning. 

Changes in tax laws are often an unwelcome part of retirement planning. But it can happen at any time, and the best response is to be proactive in how you will adjust to the new circumstances. For more help, meet with a qualified retirement planner today.