The 5 year rule does not apply when the IRA owner passes after the required beginning date. Daughter’s estate will be subject to the same RMD schedule as daughter would have had (daughter’s life expectancy). Since the estate will probably close in a reasonable time period, a portion of the IRA will probably be assigned to cousin’s trust and the daughter’s RMD schedule will continue for the trust’s portion. In a case like this, the IRA custodian will often try to push for a lump sum distribution, but that is the custodian’s rule or operating procedure and not an IRS rule. Applicable IRS Reg 1.401(a)(9)-4, Q 4:

(c) Deceased beneficiary. For purposes of this A-4, an individual who is a beneficiary as of the date of the employee’s death and dies prior to September 30 of the calendar year following the calendar year of the employee’s death without disclaiming continues to be treated as a beneficiary as of the September 30 of the calendar year following the calendar year of the employee’s death in determining the employee’s designated beneficiary for purposes of determining the distribution period for required minimum distributions after the employee’s death, without regard to the identity of the successor beneficiary who is entitled to distributions as the beneficiary of the deceased beneficiary. The same rule applies in the case of distributions to which A-5 of § 1.401(a)(9)-3 applies so that, if an individual is designated as a beneficiary of an employee’s surviving spouse as of the spouse’s date of death and dies prior to September 30 of the year following the year of the surviving spouse’s death, that individual will continue to be treated as a designated beneficiary.

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