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How Corteva Employees Can Navigate Inherited IRA Changes Without Costly Mistakes

'In light of the SECURE Act’s 10-year rule and evolving RMD requirements, Corteva employees should approach inherited IRAs with a coordinated distribution strategy that aligns income timing, Medicare considerations, and overall retirement planning, rather than viewing these assets as a simple windfall.' – Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

'For Corteva employees navigating the updated inherited IRA landscape, proactive distribution planning and careful coordination with overall retirement income can help avoid costly penalties and unintended tax consequences.' – Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How recent changes to inherited IRA rules may impact Corteva employees and other non-spouse beneficiaries.
Key distribution requirements and tax consequences, including the 10-year rule and RMDs.
Strategies for reducing tax exposure through thoughtful planning and professional guidance.

By Neva Bradley, CFP®, Wealth Enhancement

Although inheriting an IRA can feel like a financial windfall, misunderstanding the rules can trigger unexpected tax consequences under current law. Federal legislation and updated IRS guidance have significantly reshaped inherited IRA requirements in recent years, fundamentally changing how many beneficiaries must manage inherited retirement funds. For Corteva employees balancing pensions, 401(k) savings, and personal retirement accounts, these changes deserve careful attention.

Because distribution errors can result in unnecessary taxes and penalties, we at Wealth Enhancement assist individuals in making informed decisions regarding inherited IRAs. For Corteva employees who may already be coordinating company-sponsored retirement benefits with personal accounts, understanding these inherited IRA rules is especially important.

Unlike your own retirement accounts, inherited IRAs require a completely different mindset. The focus shifts from long-term tax deferral to managing distributions in a tax-efficient manner.

For most beneficiaries, the stretch IRA strategy has effectively come to an end.

For years, certain recipients could “stretch” inherited IRA distributions over their own lifetimes. Today, most non-spouse beneficiaries no longer have that flexibility. Many Corteva employees who inherit IRAs from parents or other relatives will now fall under updated distribution requirements.

Under current law, most non-spouse beneficiaries must fully distribute inherited IRA assets within 10 years of the original owner’s death. This rule was established under the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019.

IRS guidance further clarifies how the 10-year rule applies, including when annual required minimum distributions (RMDs) are required.

Failure to take a required distribution may result in an IRS excise tax equal to 25% of the amount not withdrawn. If corrected in a timely manner, that penalty may be reduced to 10%, as modified by SECURE 2.0. ¹

Significant Exceptions

Not all beneficiaries are treated the same. Key exceptions include:

- Spouses, who retain broader options as qualified beneficiaries

- Minor children of the original account owner, who may use life expectancy distributions until reaching the age of majority, after which the 10-year rule typically applies

- Certain other qualified designated beneficiaries as defined by IRS regulations

These classifications are outlined in IRS Publication 590-B.

Determining which category applies is an essential first step for Corteva employees evaluating their inherited retirement options.

Annual RMDs May Be Required During the 10-Year Period

Within the 10-year distribution window, annual RMDs may still apply depending on the circumstances.

If the original account owner passed away after beginning RMDs, annual distributions are often required in years one through nine, in addition to fully depleting the account by the end of year 10.

If the owner died before the required beginning date, annual RMDs may not be required prior to the final year—but the account must still be fully distributed by year 10.

These rules are clarified in IRS final RMD regulations and related guidance.

Failing to meet these requirements can trigger the same 25% excise tax penalty (potentially reduced if corrected promptly).

Calculating Distributions Correctly

When life-expectancy distributions apply, beneficiaries must calculate required minimum distributions using the IRS Single Life Expectancy Table. After the initial life expectancy factor is established, it generally must be reduced by one each year for subsequent calculations. ²

Using the wrong life table or miscalculating distributions can lead to compliance issues and unnecessary penalties—mistakes that can often be prevented with careful review and proper planning.

Timing Matters: Tax Brackets and Medicare Premiums

Large lump-sum withdrawals from inherited traditional IRAs can significantly increase taxable income in the year taken, potentially pushing a beneficiary into a higher tax bracket. Federal income tax brackets are adjusted annually for inflation.

Inherited IRA distributions can also impact Medicare premium surcharges (IRMAA), which are tied to income thresholds. ³

For Corteva employees approaching retirement age, this can influence broader retirement income planning decisions.

Planning Is Essential

An inherited IRA requires coordination with income levels, tax brackets, Medicare considerations, and other elements of a comprehensive retirement strategy.

If you are a Corteva employee who has inherited—or expects to inherit—an IRA, professional guidance can help clarify your options and reduce the likelihood of costly missteps.

The Retirement Group collaborates with individuals to develop situation-specific retirement and distribution strategies. You can reach our team by calling (800) 900-5867 for assistance with inherited IRA planning or broader retirement coordination.

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Sources:

1. Internal Revenue Service. Publication 590-B: Distributions from Individual Retirement Arrangements (IRAs) . Rev. 2024, U.S. Department of the Treasury, 2024, www.irs.gov/pub/irs-pdf/p590b.pdf .

2. Department of the Treasury, Internal Revenue Service. “Required Minimum Distributions.” Federal Register , vol. 89, no. 138, 19 July 2024, pp. 58870–58963, www.federalregister.gov/documents/2024/07/19/2024-14542/required-minimum-distributions .

3. Centers for Medicare & Medicaid Services. Medicare Costs for 2026 . CMS Product No. 11579, Dec. 2025, www.medicare.gov/publications/11579-medicare-costs.pdf .

How does Corteva Agriscience determine the eligibility criteria for employees to participate in the Pension and Retirement Plan, and what implications does this have for employees who were hired before or after January 1, 2007? Specifically, in what ways could this eligibility impact employees looking to retire within the next few years as they assess their planned benefits?

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Methods for Calculating Retirement Benefits: Corteva Agriscience offers different methods to calculate retirement benefits, including Formula A, B, and C. These formulas consider factors such as years of service and average monthly compensation. The formulas accommodate variations in service years, and employees must evaluate which formula provides the highest benefits based on their individual circumstances, including any service accrued before the Benefit Freeze Date(Corteva_Agriscience_Pen…).

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Survivor Benefits: Corteva Agriscience provides survivor benefits, including options like joint and survivor annuities. Employees can designate a spouse or other beneficiaries to receive benefits after their death, ensuring long-term financial security for their families. Employees should regularly update beneficiary information and carefully consider how their choice of survivor benefits impacts their family’s financial security(Corteva_Agriscience_Pen…).

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Transfers Between Affiliated Companies: The pension plan allows for the continuity of benefits when transferring between Corteva’s affiliated companies. Transfers after specific dates between titles (e.g., DuPont, Pioneer) continue to earn benefits under the initial plan, which helps employees preserve their accrued benefits when moving between titles within the company(Corteva_Agriscience_Pen…).

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Maximizing Retirement Savings: Employees can maximize their retirement savings by contributing the maximum allowed under IRS limits for 2024. Since the pension plan is a defined benefit plan, it works alongside personal savings and the Retirement Savings Plan to provide comprehensive retirement support. Strategic contributions to 401(k) and other savings vehicles can complement the pension benefits(Corteva_Agriscience_Pen…).

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Pension Funding and Viability: Corteva Agriscience manages its Pension and Retirement Plan by monitoring funding levels to meet obligations. Anticipated changes in employee demographics, such as increasing retirements, shape the company’s strategy to maintain long-term pension viability and ensure that benefits are funded adequately(Corteva_Agriscience_Pen…).

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Benefits for Employees Nearing Retirement: Employees nearing retirement may benefit from Corteva Agriscience’s plan if they qualify under the eligibility criteria. However, the plan's limitations, including the Benefit Freeze Date and early retirement reductions, may influence their decision on when to retire. Employees must weigh these factors when assessing their overall retirement strategy(Corteva_Agriscience_Pen…).

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