If you inherit an IRA, you may need to take distributions from it immediately. Here are the rules –
Basically, if it’s your spouse that died, you can stick the money in your own IRA.
If not, then you can choose:
(1) Take a lump sum payment
(2) Take the payment within 5 years
(3) Take the payments over the course of your lifetime (they assume max age is like ~83ish)
Since the money you don’t distribute grows tax free… it would seem that #3 has the highest long term value, as long as you’re already maxing your own Roth/401k/Sep IRA contributions. I need to do a little more reading about this though.