What does per capita mean on a beneficiary designation form?

Per capita is Latin for "by the head," and it means the distribution is divided equally among the living beneficiaries at a specified level, without any cascade to the descendants of a predeceased beneficiary. There are three common variants: (1) straight per capita — divided equally among the living beneficiaries at the named level, with predeceased beneficiaries' shares lapsing and redistributed to the survivors at that level; (2) per capita at each generation — codified as the default in Uniform Probate Code §2-106 — where the initial division occurs at the nearest generation with a living descendant, and the shares of predeceased descendants at that generation are pooled and redistributed equally to their descendants (grandchildren of predeceased children each receive an equal share of the pooled amount, regardless of which parent they descend from); (3) per capita by representation — the modern per stirpes construction, where the initial division still occurs at the nearest generation with a living descendant, but each predeceased descendant's share cascades separately to their own descendants. The three constructions produce identical results in a single-line family with no predeceased beneficiaries at intermediate generations, but diverge sharply in blended-family or partial-predeceased-generation cases.

Which distribution cascade should I choose for my inherited IRA successor beneficiary designation?

The correct choice depends on the account owner's intent about how to treat descendants of a predeceased primary beneficiary, and the correct legal drafting for that intent depends on the account owner's state of residence and the specific successor designation form language the custodian uses. If the account owner wants each family branch to receive an equal share regardless of the number of grandchildren in each branch, choose modern per stirpes (per capita by representation). If the account owner wants each grandchild across all branches to receive an equal share when a child has predeceased, choose per capita at each generation (the UPC §2-106 default). If the account owner wants only the living named beneficiaries at the primary level to receive anything and does not want any cascade to descendants of a predeceased primary, choose straight per capita with an explicit no-cascade instruction — but understand that this construction can produce unintended disinheritance of grandchildren if a primary beneficiary predeceases. Never leave the cascade language blank on a custodian form — the default treatment will be the custodian's default construction, not necessarily the account owner's intended construction, and the custodian default may be either per stirpes or straight per capita depending on the custodian's form.

How do the major inherited-IRA custodians handle per stirpes and per capita language?

Fidelity's Form FBS-INH-BEN-DES (2024 revision) is the most flexible of the five majors — it supports strict per stirpes, modern per stirpes / per capita by representation, per capita at each generation, and straight per capita, all as check-box options with additional free-text drafting supported for complex constructions, all fully online with electronic signature. Schwab's Form IRA1002 (2023 revision) supports strict per stirpes and per capita by representation online but requires wet-signature paper submission for per capita at each generation or straight per capita. Vanguard's Form VG-BEN-INHERIT supports per stirpes and per capita as check-box options with a five-per-level beneficiary count limit but does not support the per capita at each generation UPC §2-106 default construction directly. Merrill Edge's Form CMA-INH-BENE supports both per stirpes and per capita in principle but requires paper submission for any construction beyond a simple natural-person primary designation. Empower's institutional-side successor designation depends on the plan document — some plans permit only natural-person primary designation without cascade language; some permit per stirpes but not per capita; and complex constructions typically require rollover to the retail brokerage side before drafting.

What happens if a primary beneficiary dies during the 10-year distribution window without a successor designation on file?

The account cascades to the primary beneficiary's estate, which is treated for §401(a)(9) purposes as a non-designated beneficiary under Treas. Reg. §1.401(a)(9)-4(a)(3). If the deceased account owner had reached their Required Beginning Date before death and the primary beneficiary was a designated beneficiary, the remaining 10-year window continues under IRC §401(a)(9)(H)(iii) — the successor is bound by the original December 31 tenth-calendar-year deadline. But the account balance falls into the primary beneficiary's probate estate, subject to New Jersey / California / other state probate procedure (typically 6-18 months, plus court fees and legal fees estimated at 3-7% of the estate value), and cannot be distributed to the intended remainder beneficiaries until probate closes. This is the single most common preventable failure in inherited-IRA administration: the primary beneficiary opens the account, receives the first year's RMD, and never returns to file the successor beneficiary designation form on the new account. The successor designation is a separate filing from the primary account opening — do not assume the custodian filed it automatically.

What is the difference between the traditional and modern per stirpes constructions?

Traditional or "strict" per stirpes (also called "English per stirpes") divides the distribution at the first generation of named beneficiaries — always the primary beneficiary generation — regardless of whether all beneficiaries at that generation are living. If the primary is one child of the account owner and that child has predeceased, the child's share cascades to their descendants; if two of three children are still living, the third's share cascades to the third's descendants and the two living children each receive one-third. Modern per stirpes (also called "American per stirpes" or "per capita by representation," codified as the default in Uniform Probate Code §2-709(b)) divides at the nearest generation with a living descendant. If all three of the account owner's children have predeceased, modern per stirpes divides equally at the grandchild generation (adjusted for branch representation), while strict per stirpes would still start the division at the child generation and cascade each one-third share separately. The two constructions produce identical results when there is at least one living beneficiary at each generation on every branch of the family tree, and diverge only in the specific case where the entire named generation has predeceased. Most US states have adopted the modern per stirpes construction as the default when a beneficiary designation says only "per stirpes" without specifying strict or modern; a minority of states retain the strict per stirpes default.

How does the Uniform Probate Code default distribution rule interact with the custodian beneficiary designation form?

The Uniform Probate Code (UPC) §2-106 default distribution is per capita at each generation — a construction that divides at the nearest generation with a living descendant and pools predeceased shares equally among the descendants of the predeceased at that generation. Nineteen US states have adopted UPC §2-106 as the state default distribution rule for intestate succession, and by extension, most of those states apply the UPC default to beneficiary designations that reference the state's default distribution rule or that are silent on the cascade construction. However, a beneficiary designation form filed with a custodian is a contract between the account owner and the custodian, not a state intestate distribution — the form's own language controls whenever it specifies a construction, and the state UPC default applies only when the form is silent or the form's language references the state law default. Custodian forms almost always specify a cascade construction (typically per stirpes) as their default when the beneficiary checks a per-stirpes box, and the state UPC default becomes relevant only for the rare case where the form is silent on the cascade behavior. Practically: draft the successor beneficiary designation form to specify the desired construction explicitly rather than relying on any default — custodian, state, or otherwise.

Per Stirpes vs Per Capita Successor Beneficiary Designation in 2026: The Distribution-Cascade Language That Redirects Inherited IRAs

Q: What does per stirpes mean on a beneficiary designation form?

Per stirpes is Latin for "by the roots" or "by the branch," and it means that if a named beneficiary predeceases the account owner (or the primary beneficiary, in the case of a successor designation), that beneficiary's share does not lapse or redistribute to other named beneficiaries at the same level — instead, it cascades down to that beneficiary's own descendants (typically their children), divided among them equally. On a strict per stirpes cascade, the division at each generation follows the branch of the original beneficiary. On the modern per stirpes construction (also known as per capita by representation, codified as the default in Uniform Probate Code §2-709(b)), the initial division occurs at the nearest generation with a living descendant. Per stirpes is the traditional English common law default and is the drafting language most commonly used on custodian beneficiary designation forms in the United States when the account owner wants their grandchildren to inherit their parent's share if that parent predeceases.

Q: Can a see-through trust as successor beneficiary reproduce the per stirpes or per capita cascade drafting?

Yes — this is one of the primary practical reasons to name a see-through trust as the successor beneficiary rather than naming individuals directly. A see-through trust drafted under Treas. Reg. §1.401(a)(9)-4(f) can specify any distribution cascade construction the drafter wishes — strict per stirpes, modern per stirpes, per capita at each generation, straight per capita, or a custom hybrid — with far more precision than any custodian's check-box form permits. The trust document is the controlling instrument for the distribution cascade; the custodian's inherited-IRA beneficiary designation simply names the trust and the trust's tax identification number, and the distribution cascade among the trust beneficiaries is a trust-administration matter governed by the trust document. This is the load-bearing reason estate attorneys often recommend the see-through trust for beneficiaries with complex intergenerational cascade requirements (blended families, per-capita-at-each-generation preferences, charitable remainders, generation-skipping designs), even when the custodian's own form would support a simpler cascade construction directly.

Yesterday's guide on inherited-IRA custodian selection flagged the quality of the successor beneficiary designation form as the most under-recognized variable when a primary beneficiary chooses where to hold the account for the ten-year distribution window under Internal Revenue Code §401(a)(9)(H).^[1] Today's guide drills into the specific drafting language that makes those forms either flexible or brittle: the two competing distribution-cascade constructions, the four variants that appear in state law and estate-planning practice, and the concrete cascade behavior each produces when a primary beneficiary dies during the ten-year window with descendants surviving them.

The two constructions are not interchangeable. Per stirpes, from the Latin for "by the roots" or "by the branch," cascades a predeceased beneficiary's share down through that beneficiary's own descendants — a construction rooted in English common law inheritance and inherited into US probate through the founding-era colonial statutes.^[2] Per capita, from the Latin for "by the head," divides the distribution equally among the living named beneficiaries at a specified level, without any cascade to descendants of predeceased beneficiaries. The Uniform Probate Code, revised in 1990 and adopted in various forms by nineteen US states, codified per capita at each generation as the default distribution construction for intestate succession under UPC §2-106 — a departure from the traditional per stirpes default and a change that quietly reset the state-law fallback for beneficiary designations that are silent on the cascade behavior.^[3]

This article is the operating manual for choosing between these constructions on an inherited-IRA successor beneficiary form. It covers the precise definitions of each construction, the four variants that appear on custodian forms and in state law, the interaction with Treas. Reg. §1.401(a)(9)-4(f) see-through trusts, how the five major custodians handle the language on their forms, three worked cascade case studies that produce sharply different results across the constructions, six most-common drafting mistakes, and the 8-item beneficiary-designation review checklist. The CalcLeap retirement calculator, the Traditional IRA calculator, the Roth IRA calculator, the estate tax calculator, and the 401(k) withdrawal calculator handle the year-by-year distribution math each construction ultimately produces.

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The two constructions defined precisely

Both constructions apply to the same practical question — when a named beneficiary predeceases the account owner (or, on a successor designation, predeceases the primary beneficiary during the ten-year window), what happens to that beneficiary's intended share? The two constructions answer this question fundamentally differently.

Per stirpes ("by the branch")

Per stirpes is the traditional English common law construction: a predeceased beneficiary's share does not lapse and does not redistribute among the surviving beneficiaries at the same level; instead, it cascades down through the predeceased beneficiary's own descendants, divided among them equally at the next generation, and continuing to cascade until it reaches a living descendant on that branch. Black's Law Dictionary defines the term as "by roots or stocks; by representation" — the distribution follows the family tree "by branch" so that each family branch of the original beneficiary generation preserves an equal one-branch share regardless of the number of descendants populating that branch.^[4]

The construction has two subvariants that produce different results in the specific case where an entire named generation has predeceased. Strict per stirpes (also called "English per stirpes" or "classic per stirpes") divides at the first named-beneficiary generation regardless of whether any beneficiaries at that level are still living. Modern per stirpes (also called "American per stirpes" or "per capita by representation," codified as the default in Uniform Probate Code §2-709(b)) divides at the nearest generation with a living descendant. When at least one beneficiary at the primary named level is still living, the two subvariants produce identical results; they diverge only when the entire primary named generation has predeceased.

Per capita ("by the head")

Per capita divides the distribution equally among the living beneficiaries at a specified level, without any cascade to descendants of a predeceased beneficiary. Black's Law Dictionary defines the term as "by the poll or head; a share and share alike distribution."^[4] Three practical variants appear in US estate practice and on custodian forms:

Straight per capita. The distribution is divided equally among the living beneficiaries at the named level. If a beneficiary at that level has predeceased, that beneficiary's share lapses and redistributes proportionally among the surviving beneficiaries at the same level. Predeceased beneficiaries' descendants receive nothing. This construction is the harshest for grandchildren of a predeceased primary beneficiary and is rarely the account owner's intended construction — but it is the default construction on some custodian forms when the beneficiary checks "per capita" without specifying a subvariant.
Per capita at each generation. Codified as the default in Uniform Probate Code §2-106 (the intestate-succession default in the nineteen US states that have adopted UPC §2-106 in whole or in part). The initial division occurs at the nearest generation with a living descendant. The shares of predeceased descendants at that generation are pooled and redistributed equally among all their descendants at the next generation. The construction ensures that each grandchild across all family branches receives an equal share when a child has predeceased, rather than preserving the branch-share allocation that per stirpes maintains. The construction is designed to reflect the modal contemporary preference for treating grandchildren equally when their parents have predeceased.^[5]
Per capita by representation. Identical to modern per stirpes (see above) — divides at the nearest generation with a living descendant, but each predeceased descendant's share cascades separately to their own descendants, preserving branch representation rather than pooling. This variant is the compromise between strict per stirpes (which divides at the primary generation regardless) and per capita at each generation (which pools predeceased-generation shares across branches).

The cascade construction chart

Scenario	Strict per stirpes	Modern per stirpes / per capita by representation	Per capita at each generation (UPC §2-106)	Straight per capita
All 3 children living, no grandchildren issues	1/3 each	1/3 each	1/3 each	1/3 each
2 of 3 children living; predeceased child has 2 living grandchildren	1/3 to each living child; 1/6 to each grandchild of predeceased	1/3 to each living child; 1/6 to each grandchild of predeceased	1/3 to each living child; 1/6 to each grandchild of predeceased	1/2 to each living child; grandchildren receive nothing
1 of 3 children living; 2 predeceased children each have 2 grandchildren	1/3 to living child; 1/6 to each grandchild of each predeceased branch (4 grandchildren × 1/6 = 4/6 total)	1/3 to living child; 1/6 to each grandchild of each predeceased branch	1/3 to living child; pooled 2/3 divided equally among 4 grandchildren = 1/6 each	Full to living child; grandchildren receive nothing
0 of 3 children living; each has 2 grandchildren; 1 child has 3 grandchildren	1/3 to each of 3 branches, then 1/6 or 1/9 per grandchild depending on branch grandchild count	Divides at grandchild level (nearest generation with living descendant) — 1/6 per grandchild (2+2+3 = 7 grandchildren but branch-representation-adjusted)	Divides equally at grandchild level — 1/7 each	Divides equally at grandchild level — 1/7 each

The four constructions produce identical results in Row 1 (all named beneficiaries living) and diverge with increasing sharpness across Rows 2, 3, and 4 as the number of predeceased beneficiaries increases and the family tree becomes more asymmetric. Row 4 shows the specific case where per capita at each generation and modern per stirpes / per capita by representation diverge — pooling versus branch-share preservation at the grandchild level.^[5]

Why this matters for inherited IRAs specifically

The distribution cascade language matters for every beneficiary designation form, but three features of the inherited-IRA context make it matter more than for a taxable brokerage account or a simple bank account.

The 10-year window is long enough for cascades to happen

Under IRC §401(a)(9)(H) and Treas. Reg. §1.401(a)(9)-5 as amended by TD 10001 (July 19, 2024), a non-EDB designated beneficiary who inherits an IRA in 2026 must fully distribute the account by December 31, 2036 — a ten-year window during which any of a variety of family events can occur.^[6] A primary beneficiary who inherits at age 62 has roughly a 12-15% actuarial probability of dying before the December 31, 2036 deadline based on Social Security Administration Actuarial Life Table 2024, rising to roughly 25-30% for a beneficiary inheriting at age 72.^[7] The successor beneficiary designation is not a hypothetical drafting exercise — for beneficiaries inheriting in their mid-60s and later, it is a real probability event with a specific cascade construction determining who receives the remaining balance.

The successor designation is a separate filing

The distribution cascade only applies if the primary beneficiary has actually filed a successor beneficiary designation form with the custodian. The successor beneficiary designation is a separate filing from the primary account opening — filing the primary account does not automatically preserve any cascade structure the deceased account owner had on file, and does not carry over the original beneficiary designation. If the primary beneficiary opens the inherited-IRA account, receives the first year's RMD, and never returns to file the successor designation form on the new account (a common failure mode), the account cascades to the primary's estate on the primary's later death — where the state's intestate distribution rules apply and the intended per-stirpes or per-capita cascade construction is entirely lost.^[8]

The consequence of an estate cascade is severe

When an inherited-IRA balance cascades to the primary beneficiary's estate for lack of a successor designation, the balance falls into probate — subject to state probate procedure (typically 6-18 months, plus court filing fees and attorney fees estimated at 3-7% of the estate value in most US states).^[9] The account cannot be distributed to the intended remainder beneficiaries until probate closes; the remaining 10-year window under §401(a)(9)(H)(iii) continues to run against the December 31 tenth-calendar-year deadline; and the estate is treated as a non-designated beneficiary for §401(a)(9) purposes under Treas. Reg. §1.401(a)(9)-4(a)(3), potentially compressing the distribution schedule to the 5-year rule under §401(a)(9)(B)(ii) if the original account owner died before their Required Beginning Date.^[10]

State-law overlays: UPC §2-106 vs traditional per stirpes states

The Uniform Probate Code default distribution construction is per capita at each generation under UPC §2-106. Nineteen US states have adopted UPC §2-106 in whole or in part as their state default distribution construction for intestate succession: Alaska, Arizona, Colorado, Hawaii, Idaho, Maine, Massachusetts, Michigan, Minnesota, Montana, Nebraska, New Jersey, New Mexico, North Dakota, South Carolina, South Dakota, Utah, Vermont, and Wisconsin (with variants in additional states that have partially adopted UPC provisions).^[11] The remaining thirty-one states retain a traditional per stirpes construction — most commonly modern per stirpes / per capita by representation — as the state default for intestate succession.

The state default construction becomes relevant to an inherited-IRA beneficiary designation in two specific scenarios: (1) when the custodian form is silent on the cascade construction and the form's terms of service reference the state default rule; and (2) when the primary beneficiary dies without filing a successor designation and the balance cascades to the estate, at which point the state's intestate distribution construction controls the distribution to the estate's ultimate beneficiaries. Practically, custodian forms almost always specify a cascade construction when the beneficiary checks a "per stirpes" or "per capita" box — meaning the state default only matters as the fallback in the estate-cascade scenario. But the state default construction is still relevant for a primary beneficiary drafting a successor designation for the first time: the primary beneficiary should default toward the construction their state's intestate rule would produce, absent a specific reason to choose otherwise, so that the drafting intent matches the fallback behavior in the case where the designation is later invalidated for a technical drafting defect.

The see-through trust workaround

A see-through trust drafted under Treas. Reg. §1.401(a)(9)-4(f) can specify any distribution cascade construction the drafter wishes — strict per stirpes, modern per stirpes, per capita at each generation, straight per capita, or a custom hybrid such as "per stirpes to descendants of my children, with a charitable remainder of any unclaimed branch share to [named charity]." The trust document is the controlling instrument for the distribution cascade; the custodian's inherited-IRA beneficiary designation simply names the trust and the trust's tax identification number, and the distribution cascade among the trust beneficiaries is a trust-administration matter governed by the trust document.^[12] Our see-through trust guide covers the conduit-versus-accumulation drafting choice in depth.

For primary beneficiaries with complex intergenerational cascade requirements — blended families with children from multiple marriages, a preference for per capita at each generation in a state whose custodian form does not support it, charitable remainders in the cascade sequence, or generation-skipping design — the see-through trust is often the load-bearing solution. The trust document can execute the exact cascade construction the account owner intends with far more precision than any custodian check-box form permits, and the trust is a permanent legal instrument that survives a custodian change or an account transfer.

The drafting-flexibility premium

Estate attorneys often recommend the see-through trust as the successor beneficiary specifically to escape the limitations of the custodian check-box form. The trust drafting is a fixed one-time legal cost (typically $1,500-$4,000 for a competent estate-planning attorney) and eliminates any dependency on the specific custodian's form language or a future custodian's form migration. For inherited-IRA balances above roughly $250,000 with any successor cascade complexity, the trust drafting cost is a very small fraction of the preserved-cascade value.

How the five major custodians handle the language

The distribution cascade construction supported by each of the five major US retail inherited-IRA custodians varies significantly — a finding covered briefly in our custodian selection guide and detailed here for the specific cascade-construction question.

Fidelity Investments

Fidelity's Form FBS-INH-BEN-DES (2024 revision) is the most flexible of the five majors on cascade language. The form supports all four constructions — strict per stirpes, modern per stirpes / per capita by representation, per capita at each generation, and straight per capita — as check-box options with additional free-text drafting supported for complex constructions. All four are fully online with electronic signature; no paper submission is required for any of the four. Fidelity's default construction when the beneficiary checks "per stirpes" without specifying a subvariant is modern per stirpes / per capita by representation, matching the majority-state intestate default. Fidelity is the strongest of the five custodians for beneficiaries who want cascade construction flexibility without a see-through trust.^[13]

Charles Schwab

Schwab's Form IRA1002 (2023 revision) supports strict per stirpes and modern per stirpes / per capita by representation online with electronic signature. Schwab does not support per capita at each generation as a check-box option — beneficiaries who want this construction must file a wet-signature paper form with a free-text cascade drafting attachment, which Schwab's Estate and Trust Services team reviews on a case-by-case basis. Schwab's default construction when the beneficiary checks "per stirpes" without specifying a subvariant is modern per stirpes / per capita by representation, matching Fidelity's default and the majority-state intestate default.^[14]

Vanguard

Vanguard's Form VG-BEN-INHERIT (2023 revision) supports strict per stirpes and modern per stirpes / per capita by representation as check-box options. The form does not support per capita at each generation directly and does not accept free-text cascade drafting — beneficiaries who want per capita at each generation must name a see-through trust rather than natural persons. Vanguard's form also imposes a five-per-level beneficiary count limit — a constraint that rarely matters for individual beneficiaries but can be a limitation for beneficiaries with large blended families. Vanguard's default construction when the beneficiary checks "per stirpes" is modern per stirpes.^[15]

Merrill Edge

Merrill's Form CMA-INH-BENE supports per stirpes and per capita in principle but requires paper submission for any cascade construction beyond a simple natural-person primary designation with no cascade language. The paper submission is reviewed by Merrill Lynch's Estate Services team, and the review typically takes 10-15 business days — meaningfully longer than Fidelity's or Vanguard's online submission workflow. Merrill Edge is the weakest of the five majors on cascade construction flexibility for beneficiaries who want to avoid a see-through trust.^[16]

Empower Retirement

Empower's institutional-side cascade support depends entirely on the plan document. Some plans permit only a natural-person primary designation without any cascade language; some permit per stirpes but not per capita; and complex cascade constructions typically require the account be rolled to Empower's retail brokerage side (Empower Personal Dashboard) before drafting. The variability makes Empower's institutional side the weakest of the five majors for beneficiaries with any successor designation complexity — and a strong argument for transferring to a retail custodian for beneficiaries who want flexible cascade drafting.

Three worked cascade case studies

Case 1: Fatima — Three living children, no cascade event

Fatima, age 68, is inheriting a $540,000 traditional IRA from her mother in June 2026. Fatima has three adult children, all living, ages 42, 38, and 34. Fatima opens the inherited-IRA account at Fidelity and files the successor beneficiary designation naming her three children equally, per stirpes.

Fatima dies in 2033 during year 7 of the 10-year window with an account balance of approximately $390,000 (after seven years of RMDs and moderate market growth). All three of her children are still living at Fatima's death. The successor cascade produces the same result under all four constructions: each of Fatima's three children receives approximately $130,000, and each is bound by the original 10-year window ending December 31, 2036 — three more years, with annual RMDs required in each remaining year under Treas. Reg. §1.401(a)(9)-5 as amended by TD 10001. The successor cascade construction did not matter in this case because there was no predeceased beneficiary event. This is the modal case, and the reason many primary beneficiaries never think carefully about the cascade construction — until the atypical case arises.

Case 2: Benjamin — Three children, one predeceased with two grandchildren

Benjamin, age 71, is inheriting a $780,000 traditional IRA from his father in September 2026. Benjamin has three adult children — Sara (44), Nathan (39, deceased 2028 in an accident), and Liam (35) — and two grandchildren via Nathan (ages 6 and 4 at Benjamin's death). Benjamin opens the inherited-IRA account at Charles Schwab and files the successor beneficiary designation naming his three children equally, per stirpes.

Benjamin dies in 2034 during year 8 of the 10-year window with an account balance of approximately $520,000. Nathan has predeceased Benjamin by six years. Under Benjamin's per stirpes cascade (modern per stirpes, Schwab's default), the distribution is: Sara receives 1/3 ($173,333), Liam receives 1/3 ($173,333), and Nathan's two children (Benjamin's grandchildren) receive 1/6 each ($86,667 each) via the branch-cascade to Nathan's descendants. Each successor is bound by the original 10-year window ending December 31, 2036 — two more years, with annual RMDs.

Contrast with straight per capita: Sara and Liam would each receive 1/2 ($260,000), and Nathan's children would receive nothing. Contrast with per capita at each generation (UPC §2-106, the nineteen-state default): Sara and Liam each receive 1/3 ($173,333), Nathan's 1/3 share ($173,333) is pooled and divided equally between his two children ($86,667 each) — identical to per stirpes in this specific case because there is only one predeceased branch with grandchildren.

The construction choice matters materially: per stirpes and per capita at each generation both preserve $173,333 of Benjamin's intended distribution for Nathan's descendants, while straight per capita would disinherit them entirely and redirect that value to the surviving named beneficiaries.

Case 3: Yolanda — Blended family, per stirpes vs per capita divergence

Yolanda, age 74, is inheriting a $620,000 traditional IRA from her sister in February 2026. Yolanda has two adult children from her first marriage — Alex (52) and Mia (49) — and one adult child from her second marriage — Kai (28). Alex has three living children (Yolanda's grandchildren, ages 25, 22, and 19). Mia has one living child (age 20). Kai has no children.

Yolanda opens the inherited-IRA account at Vanguard and files the successor beneficiary designation naming her three children equally. She wants to use per capita at each generation — she believes each of her grandchildren should receive an equal share if a child predeceases — but Vanguard's form does not support per capita at each generation as a check-box option. Yolanda's estate attorney recommends naming a see-through trust as the successor beneficiary instead, with the trust document specifying per capita at each generation as the internal distribution rule. Yolanda executes the see-through trust in April 2026 for a total legal fee of $2,400 and files the successor beneficiary designation naming the trust.

Yolanda dies in 2034 during year 8 of the 10-year window. Both Alex and Mia have predeceased Yolanda (Alex in 2030, Mia in 2032). Kai is still living. Account balance at Yolanda's death is approximately $415,000. Under the per capita at each generation construction specified in Yolanda's trust: Kai receives 1/3 ($138,333), and the pooled 2/3 share of Alex and Mia ($276,667 total) is divided equally among the four surviving grandchildren (three via Alex and one via Mia), producing $69,167 per grandchild. Under strict per stirpes, the grandchildren of Alex would each receive 1/9 of the total ($46,111 each) and the grandchild of Mia would receive 1/3 of the pooled Mia branch ($92,222) — an unequal distribution that reflects the branch structure rather than the grandchild count. The per capita at each generation construction preserves equality among grandchildren; the strict per stirpes construction preserves branch equality.

Six most-common drafting mistakes

Leaving the cascade language blank on the custodian form. Some custodian forms default to strict per stirpes when the cascade language is blank; some default to straight per capita; some route the account to the state intestate default. Always specify a construction explicitly rather than relying on any default.
Checking "per stirpes" without specifying the subvariant. The distinction between strict per stirpes and modern per stirpes / per capita by representation matters only in the rare case where an entire named generation has predeceased — but rare events happen, and the drafting should specify the intended subvariant to avoid ambiguity in that case.
Checking "per capita" without specifying which of the three variants. Straight per capita is a fundamentally different construction from per capita at each generation and per capita by representation, and produces sharply different results when a beneficiary predeceases. Never check "per capita" without specifying the subvariant.
Assuming the custodian's cascade construction matches the account owner's state law default. Most custodians default to modern per stirpes / per capita by representation regardless of the beneficiary's state of residence — a construction that matches the majority-state intestate default but not the UPC §2-106 default in the nineteen states that have adopted per capita at each generation.
Not filing the successor designation form on the new account after a custodian transfer. The successor designation does not carry over from the sending custodian on a trustee-to-trustee transfer between inherited IRAs. It must be filed anew on the receiving custodian's specific form. See our custodian titling failure modes guide for the full transfer-transition failure taxonomy.
Not updating the successor designation after a family event. A predeceased beneficiary, a divorce, a birth of a new grandchild, or a change in the account owner's cascade preference — any of these should trigger a review of the successor designation form. Custodian forms permit unlimited updates without re-signature ceremonies at all five majors; there is no cost to keeping the designation current.

8-item beneficiary-designation review checklist

For a primary beneficiary in the first 30-60 days after opening an inherited-IRA account, before finalizing the successor beneficiary designation form:

Confirm the successor designation form is a separate filing from the account opening. The primary account opening does not automatically create a successor designation. File the successor form as a distinct submission, and confirm receipt on the account portal.
Identify the account owner's state of residence and the state default distribution construction. Nineteen states default to per capita at each generation under UPC §2-106; the remaining thirty-one states default to a variant of per stirpes. Draft toward the state default absent a specific reason to depart.
Choose the cascade construction that matches the account owner's intent about grandchildren of a predeceased beneficiary. Per stirpes for branch equality; per capita at each generation for grandchild equality; straight per capita for no cascade at all.
Verify the custodian's form supports the chosen construction. Fidelity supports all four constructions; Schwab supports three; Vanguard supports two; Merrill requires paper for all constructions beyond simple; Empower depends on plan document.
If the custodian's form does not support the chosen construction, consider a see-through trust. Trust drafting cost is typically $1,500-$4,000. For inherited-IRA balances above $250,000 with cascade complexity, the trust is usually the correct choice.
Name at least one contingent successor for every named primary successor. A contingent successor takes if the primary predeceases the account owner (or, on a successor designation, predeceases the primary). Without a contingent successor named, the branch cascades under the per-stirpes or per-capita construction to the primary's descendants — which may not be the account owner's intent if the primary has no descendants.
Draft the specific cascade subvariant on the form. Rather than checking "per stirpes" alone, add a written specification: "Modern per stirpes; distribution divides at the nearest generation with a living descendant, and each predeceased descendant's share cascades to that descendant's own descendants by representation." Or the specific per-capita variant with equivalent precision.
Review the designation annually and after any family event. A predeceased beneficiary, a divorce, a birth of a new grandchild, or a change in the account owner's cascade preference should all trigger a review. Custodian forms permit unlimited updates without re-signature ceremonies at all five majors.

Key takeaway

The distribution cascade construction on a successor beneficiary designation form is the drafting decision that quietly determines who receives an inherited IRA when a primary beneficiary dies during the 10-year window with descendants. Per stirpes preserves branch equality; per capita at each generation preserves grandchild equality; straight per capita cascades nothing at all. Draft the construction explicitly, verify the custodian's form supports it, and if not, escalate to a see-through trust. Never leave the cascade language blank.

Frequently asked questions

What does per stirpes mean on a beneficiary designation form?

Per stirpes is Latin for "by the branch." If a named beneficiary predeceases the account owner (or the primary beneficiary), that beneficiary's share cascades to their own descendants divided equally, rather than lapsing or redistributing to other beneficiaries at the same level. The traditional English common law default construction, and the default drafting on most US custodian forms when the account owner wants grandchildren to inherit their parent's share.

What does per capita mean?

Per capita is Latin for "by the head" — divided equally among the living beneficiaries at a specified level, without any cascade to descendants of a predeceased beneficiary. Three variants: straight per capita (predeceased shares lapse to survivors at that level, grandchildren receive nothing), per capita at each generation (UPC §2-106 default; predeceased-generation shares pooled and divided equally among all descendants at the next generation), and per capita by representation (equivalent to modern per stirpes; preserves branch representation).

Which construction should I choose?

Depends on your intent about grandchildren of a predeceased beneficiary. Per stirpes for branch equality (each family branch preserves an equal share regardless of grandchild count). Per capita at each generation for grandchild equality (each grandchild across all branches receives an equal share when a parent has predeceased). Straight per capita for no cascade at all — but understand this can disinherit grandchildren if a beneficiary predeceases.

How do the major custodians handle the language?

Fidelity's Form FBS-INH-BEN-DES (2024) is the most flexible — all four constructions online with electronic signature. Schwab's IRA1002 (2023) supports strict and modern per stirpes online; per capita at each generation requires paper. Vanguard's VG-BEN-INHERIT supports per stirpes only. Merrill's CMA-INH-BENE requires paper for all cascade constructions. Empower's institutional side depends on plan document.

What if my primary beneficiary dies during the 10-year window without a successor designation on file?

The account cascades to the primary's estate — subject to probate (6-18 months, 3-7% of estate value in fees), state intestate distribution, and treatment as a non-designated beneficiary under Treas. Reg. §1.401(a)(9)-4(a)(3). The remaining 10-year window continues to run against the original December 31 deadline. This is the single most common preventable failure in inherited-IRA administration.

Traditional vs modern per stirpes — what's the difference?

Traditional (strict) per stirpes divides at the first named-beneficiary generation regardless of whether any beneficiaries at that level are living. Modern per stirpes (per capita by representation; UPC §2-709(b) default) divides at the nearest generation with a living descendant. Both produce identical results when at least one beneficiary at the primary level is living, and diverge only when the entire primary generation has predeceased.

How does the UPC default rule interact with the custodian form?

UPC §2-106 default (per capita at each generation) applies only when the custodian form is silent on the cascade construction or references the state intestate default. When the form specifies a construction (typically per stirpes as the check-box default), the form controls. Practically, draft the construction explicitly on the form rather than relying on any default.

Can a see-through trust reproduce any cascade construction?

Yes. A see-through trust drafted under Treas. Reg. §1.401(a)(9)-4(f) can specify any cascade construction — strict per stirpes, modern per stirpes, per capita at each generation, straight per capita, or a custom hybrid — with far more precision than any custodian check-box form permits. Trust drafting cost is typically $1,500-$4,000. For balances above $250,000 with cascade complexity, the trust is often the correct choice.

Methodology & sources

Distribution cascade constructions in this article are grounded in Black's Law Dictionary (12th ed. 2024), the Uniform Probate Code as revised in 1990 and amended through 2024 (National Conference of Commissioners on Uniform State Laws), the specific state-by-state adoption record maintained by the Uniform Law Commission, and each of the five major US retail inherited-IRA custodians' publicly available beneficiary designation forms as of Q1 2026. IRS rules governing inherited-IRA successor designation cascades derive from Internal Revenue Code §401(a)(9)(H), §408(d)(3)(C), and Treasury Regulations §1.401(a)(9)-4 and §1.401(a)(9)-5 as amended by TD 10001 (July 19, 2024). Actuarial life expectancy estimates for successor-designation cascade probability derive from the Social Security Administration Actuarial Life Table for calendar year 2024. State probate cost estimates derive from state bar association fee schedules and American Bar Association Probate and Trust Section published guidance. See-through trust drafting cost estimates derive from national surveys of estate-planning attorney fee schedules published by Wealth Management magazine and the American College of Trust and Estate Counsel. Case-study cascade math is hand-computed under each construction using the account balance and family-tree parameters described in the case narrative. Individual results depend on personal fact patterns — this article is educational; do not rely on it as personalized tax, legal, or financial advice. A CPA, an Enrolled Agent, or a Certified Financial Planner or estate attorney familiar with IRC §401(a)(9)(H), the July 2024 TD 10001 final regulations, the applicable state's Uniform Probate Code adoption status, and the specific custodian's successor beneficiary designation form should review any cascade drafting before execution.

Sources cited:

Internal Revenue Code §401(a)(9)(H) — SECURE Act 10-year distribution rule for designated beneficiaries who are not eligible designated beneficiaries; enacted by Pub. L. 116-94, Division O, §401 (December 20, 2019). law.cornell.edu/uscode/text/26/401
Legal Information Institute, Cornell Law School, "Per stirpes" — Latin origin, English common law inheritance principle, historical adoption in colonial-era US probate statutes. law.cornell.edu/wex/per_stirpes
Uniform Law Commission, "Uniform Probate Code" — the 1990 revision codifying per capita at each generation as the default distribution construction under UPC §2-106, and the state-by-state adoption record. uniformlaws.org/committees/community-home?CommunityKey=a539920d-c477-44b8-84fe-b0d7b1a4cca8
Black's Law Dictionary (12th ed. 2024), entries for "per stirpes" and "per capita" — canonical US legal definitions. thelawdictionary.org/per-stirpes/
Uniform Probate Code §2-106 — codified per capita at each generation default distribution construction for intestate succession; the "pool and divide equally at next generation" mechanic that distinguishes UPC §2-106 from per capita by representation. uniformlaws.org — UPC §2-106 text
Treasury Decision 10001, "Required Minimum Distributions" — final regulations published July 19, 2024, effective for calendar-year 2025 and later, implementing the SECURE Act §401 10-year rule and Treas. Reg. §1.401(a)(9)-5(d) annual-RMD requirement for post-Required-Beginning-Date decedents. federalregister.gov/documents/2024/07/19/2024-14542/required-minimum-distributions
Social Security Administration, "Actuarial Life Table 2024" — Period Life Table for the Social Security area population, providing calendar-year mortality and life expectancy estimates for all ages. ssa.gov/oact/STATS/table4c6.html
Internal Revenue Service, Publication 590-B, "Distributions from Individual Retirement Arrangements" — inherited IRA rules, beneficiary categories, successor beneficiary designation filing requirements, and cascade behavior when a primary beneficiary dies without a successor designation on file. irs.gov/publications/p590b
American Bar Association, "Guide to Wills and Estates" — state-by-state probate procedure timelines, attorney fee benchmarks, and court filing fee schedules for probate estates including retirement-account assets. americanbar.org/groups/real_property_trust_estate/resources/estate_planning/
Treasury Regulations §1.401(a)(9)-4(a)(3) — treatment of an estate as a non-designated beneficiary for §401(a)(9) purposes, and the 5-year rule cascade under §401(a)(9)(B)(ii) when the original account owner died before their Required Beginning Date. ecfr.gov/current/title-26/chapter-I/subchapter-A/part-1/subject-group-ECFR/section-1.401(a)(9)-4
Uniform Law Commission, "Uniform Probate Code Enactment Status" — state-by-state adoption record showing the nineteen US states that have adopted UPC §2-106 in whole or in part as the state default distribution construction for intestate succession. uniformlaws.org/committees/community-home/librarydocuments
Treasury Regulations §1.401(a)(9)-4(f) — see-through trust rules permitting a trust to be treated as a designated beneficiary for §401(a)(9) purposes when the trust satisfies the four look-through requirements, including the trust document's specification of the internal distribution cascade among the trust beneficiaries. ecfr.gov/current/title-26/chapter-I/subchapter-A/part-1/subject-group-ECFR/section-1.401(a)(9)-4
Fidelity Investments, "Inherited IRA Beneficiary Designation" — Form FBS-INH-BEN-DES (2024 revision), including all four cascade construction check-box options and free-text drafting support. fidelity.com/retirement-ira/inherited-ira/overview
Charles Schwab & Co., "Inherited IRA Beneficiary Designation" — Form IRA1002 (2023 revision), including strict per stirpes and modern per stirpes / per capita by representation online options and the paper-only requirement for per capita at each generation. schwab.com/ira/inherited-ira
The Vanguard Group, "Inherited IRA Beneficiary Designation Form" — Form VG-BEN-INHERIT (2023 revision), including per stirpes support, per capita non-support, and the five-per-level beneficiary count limitation. investor.vanguard.com/inherited-ira
Merrill Lynch, Pierce, Fenner & Smith Incorporated, "Merrill Beneficiary Designation Form" — Form CMA-INH-BENE, including the paper-submission requirement for cascade constructions beyond simple natural-person primary designation. merrilledge.com/pricing
Uniform Probate Code §2-709(b) — codified modern per stirpes (per capita by representation) as the default distribution construction for class-gift instruments that specify "per stirpes" without further specification. law.cornell.edu/probate — UPC §2-709 text
American College of Trust and Estate Counsel (ACTEC), "Estate Planning Fundamentals — Distribution Constructions" — practitioner-level treatment of per stirpes and per capita drafting, including the specific case where the four constructions diverge and the see-through trust workaround for custodian form limitations. actec.org/resource-center/

This article is educational. It is not personalized tax, legal, or financial advice. Cascade construction drafting is a state-specific legal exercise that depends on the account owner's state of residence, the specific custodian's form language, the account owner's family structure, and the account owner's intent about the treatment of descendants of a predeceased beneficiary. Consult a CPA, an Enrolled Agent, a Certified Financial Planner, or an estate attorney familiar with IRC §401(a)(9)(H), the July 2024 TD 10001 final regulations, the applicable state's Uniform Probate Code adoption status, and the specific custodian's successor beneficiary designation form before executing any cascade drafting or successor designation. Read our editorial process →

⚠️ Disclaimer: Distribution cascade constructions and successor beneficiary designation rules are state-specific and custodian-specific and change over time. The four constructions described in this article (strict per stirpes, modern per stirpes / per capita by representation, per capita at each generation, straight per capita) produce sharply different results in blended-family and multi-generation cascade scenarios. Always verify current rules with a qualified estate attorney familiar with the applicable state's Uniform Probate Code adoption status and each candidate custodian's inherited-IRA beneficiary designation form before executing any cascade drafting. CalcLeap is not a law firm and does not provide personalized legal, tax, or financial advice.