Under the SECURE Act, an individual is “chronically ill” if they have been certified by a licensed health care practitioner as being unable to perform (without substantial assistance from another individual) at least 2 activities of daily living for a period of at least 90 days due to a loss of functional capacity. “Activities of daily living” include eating, toileting, transferring, bathing, dressing and continence. See 26 U.S. Code §7702B(c)(2)(B). An individual is also considered to be “chronically ill” if he/she requires substantial supervision to protect himself/herself from threats to health and safety due to severe cognitive impairment.
If a chronically ill individual inherits an IRA, then under the SECURE Act, the individual is not required to withdraw the entire account balance within ten years. Instead, they may stretch the required minimum distributions (RMDs) and tax payments over their life expectancy.