<prompt> Human: Ive done a lot of digging online and in the wiki but I cant seem to either find an explanation or understand it when I may have found it.Its not a lot she was a librarian in an elementary school, so the Im suddenly rich! spending wont happen.Mainly Im trying to understand the difference between the two. From what I understand, the inherited IRA is that the money there can be pulled out and is considered income for tax purposes, and that I have to pull out a certain amount each year from the account if she was already pulling money out or if she wouldve been about 70 years old.I havent been able to find anything specific about the distributions, but from what little general information I have found, its a percentage of the total that she left me in basically the form of a paycheck, given to me monthly.Other than that and even then thats probably too simplified or just flat-out wrong, I am too in the dark regarding my options to make a good decision.  <response>: The difference is how you choose to do your distributions. The account will need to be rolled into an inherited IRA for your benefit and then you will have to decide how you want to distribute it. Do you can either elect to have distributions based on your life expectancy stretch it out or it needs to be distributed entirely within 5 years. This article is worth a read but here is the portion that relates to your question:The money in an inherited IRA must be taken out eventually, except in some cases when the beneficiary is the spouse of the deceased.Nonspouse beneficiaries have 2 options for liquidating the account:They can choose to take distributions over their life expectancy, known as the stretch option, which leaves the funds in the IRA for as long as possible.Or they must liquidate the account within 5 years of the original owners death.The stretch IRA is the tax equivalent of the treasure at the end of the rainbow. Hidden beneath the layers of rules and red tape is the ability to shelter funds from taxation while they grow for decades. In the case of a Roth IRA, earnings accumulate tax-free.One slip-up by the beneficiary or even by the benefactor before death, and that tax gem can be lost forever.Instead, the beneficiary will be forced to take the money out of the IRA under the 5-year rule. For substantial accounts, that can add up to a monstrous income tax bill -- unless the IRA is a Roth, in which case taxes were paid before money went into the account.Distributions from an inherited Roth IRA will be tax-free unless the account was established less than 5 years before -- in which case the earnings may be subject to tax. 