But there’s a hitch: This RMD hall pass for surviving beneficiaries requires these inherited accounts to be emptied by Dec. 31 of the 10th year following the year of death. Failure to comply could trigger a 50% penalty; a full withdrawal after 10 years of compounding could produce a huge lump-sum of taxable income.
Financial Planning magazine has an article discusses various deft maneuvering to deal with such long term concerns, worth a read for someone face such a situation.