It's all kind of a judgment call each year because tax brackets change and the amount in each account type changes. For the hypothetical, could you also include how much is in taxable, how much of that is gains (remember you received a stepped up basis on death), how much in traditional IRA/401k (both inherited and your own) and how much in Roth IRA/401k?
Inherited taxable $1.2M $180k in gains
Inherited IRA $732k $110k in gains
My rollover IRA $584k
DW Roth 401k $602k
Answering your question so you might have two answers to choose from. I would do 4k more so 24k from the inherited IRA to fill up the new 24k standard deduction. 14.5k from your IRA. That would be about 2.5% of your IRA per year. 15k from her Roth. This leaves 66.5k from the taxable inherited.
14.5 would be taxed @ 10%. The gains, something less than the 66.5k from the taxable, would be taxed @ 0% until your total between gains and 14.5 from your IRA hit 77,200, which it probably wouldn't hit.
This is not meant as tax advice.
This sounds like great advice to me.
Here's how I might think of it:
IRA withdrawals/conversions to roth: $24000 standard deduction + $19050 10% bracket = $43050
Capital gains harvesting: up to top of 0% capital gains rate ($77,200), so another $58,150. Since 180k/1.2M = 15% of your taxable holdings are gains, this would mean you're selling 58150/0.15 = $387,666 worth of stock. Of course, you'll need to reinvest some of that since it's more than you need to live on. You can buy back exactly what you sold if you want (wash sales only count when you sell at a loss, not a gain). This math will of course change every year as you have different amounts of gains.
This would result in a total federal tax bill of $1905.
Since you'll have plenty to live off of from the taxable account sale, I would make the IRA withdrawals conversions to roth to the extent possible (so the $14150 over your RMD).
I think going into the 12% bracket for roth conversions would also be a decent option. In this case, you need $100k of spending money over your $20k RMD, which would have a $15k gain if you sell taxable. So you would have $20,000 RMD, $100k taxable sale (for $15k gain) which make up your spending money and as much as a $66,200 IRA to roth conversion (if I did the math right -- definitely double check and/or run it through some tax software). This would result in a total federal tax bill of $7083.
Anywhere in between those options would work out just fine. At some point you'll probably run out of IRA to be converted and/or gains to be harvested at which point you may consider withdrawing more from the inherited IRA to live off of than the RMD since you can't roth convert an inherited IRA (according to the google search I just did).