72t on the Net

income property in IRA

Start by reading the rules on 72(t) and figuring out whether your plan fits a 72(t) plan. Also remember that regardless of what type of investment that you use to fund your IRA, it is separate from, and has no bearing on a SEPP plan. - continued...

income property in IRA

I am 49 yrs old, and want to set up an IRA which buys an income producing property. Setup through a trust company properly....How do I set up early withdrawls on an income producing property? An example:I have 150,000 dollars in this IRA trust account. The trust account buys a house for 150,000 dollars. The house generates 10,000 dollars in re - continued...

72t with NUA

It depends on when you want to use the take the NUA distribution. If the plan allows flexible distributions each year until age 59.5, you could set them up and defer the NUA until the year you turn 59.5, and then do the LSD using age 59.5 as a new triggering event.But if you want to distribute the highly appreciated shares first, then you will need - continued...

"Reasonable" Balance date and splitting IRA's

I think you should consider a different approach. The change to RMD will probably not make enough of a difference, and might push you into a higher tax bracket on top of your "next job". Since that will probably come within the next year, you might be better off considering just taking IRA distributions as you need them now, and pay the 10% penalty - continued...

72t with NUA

PATTI -- You did not indicate if you're talking about a 401-K or a pension. If a 401-k, then it would not make sense to set up a SEPP 72-T because you are 55 and would be "separated from service", which would make distributions from the 401-k exempt from the 10% penalty for early distributions before 59 1/2. Of course your 401-K would have to provi - continued...

"Reasonable" Balance date and splitting IRA's

what i mean by "future planning flexibility" is that i am unemployed now but if i find work its my understanding i can change my method of calculation down to RMD and this will allow me to dial down my income. Right now, i need the most i can get so i plan on doing a direct transfer of 1/3rd of my current IRA balance and then do a 72t calculation - continued...

72t with NUA

Yes, you can start the 72t anytime you want.You would take the LSD in 2009, and just hope the shares still carry enough NUA to make that election worthwhile. You may need to abort this strategy if concentration in this one stock requires that you sell it in the plan to avoid a disaster. Proper diversification always trumps a tax benefit because of - continued...

72t with NUA

I am retiring in December. I am 55 years old, and originally planned to use the 72t distribution beginning in January. With the decrease in the Fed Fund rate, and considering the current financial disaster, I am a little anxious about the 72t distribution.My question is this: Can I use the NUA distribution for 2009, and then use the 72t distribu - continued...

72T PLAN DECREASE

The fact that the SEPP 72-T plan value has declined will not change your annual (or monthly) distribution requirement (unless you switch to the alternative amortization method which changes the distribution amount every year based upon 12/31 values. If you leave it alone, the worst that would happen would be that it would not last as long as if it - continued...

72T PLAN DECREASE

I am in a 72T plan that was started in Jan 2008. I have seen my account go from $540,000 to $400,000 in this time. I am currently withdrawing $1600 monthly from the plan. This market scares me. I am afraid that the plan may go down more in the 5 year time frame that the 72T is set up for. Would it be wise to bust the plan by stopping it and pay the - continued...

"Reasonable" Balance date and splitting IRA's

Yes, you do not say what you mean by "future planning flexibility."If you intend to use the total of all account balances, you should probably not try to go back earlier than April for an October start date. However, if you are splitting the IRAs to create one with the balance you will need to fund your 72t distribution needs, you CANNOT go back pr - continued...

"Reasonable" Balance date and splitting IRA's

Are you planning on using the entire balance for the SEPP or only one of the portions after the split? If you are only going to use part of the IRA (for example the 2/3 amount), then you should probably use the balance after the split is made and you have documents that show the amounts in two different IRA accounts. - continued...

"Reasonable" Balance date and splitting IRA's

The key is your own needs. You could probably use 12/31/07 or any month-end (for convenience) during 2008. Usually we recommend using the lowest balance that will satisfy your cash flow needs, so that you will have a higher balance available to split again for a future 2nd SEPP 72-T, and still having some of that still left for any other emergency. - continued...

"Reasonable" Balance date and splitting IRA's

I have found my answer about "reasonable date" from colnol post on 9-19- but still looking for answers on my split IRA issue. - continued...

"Reasonable" Balance date and splitting IRA's

I have found my answer about "reasonable date" from colnol post on 9-19- but still looking for answers on my split IRA issue. - continued...

"Reasonable" Balance date and splitting IRA's

I have found my answer about "reasonable date" from colnol post on 9-19- but still looking for answers on my split IRA issue. - continued...

"Reasonable" Balance date and splitting IRA's

I had 1 IRA at 12/31/07 with a balance of $864,188. I want to start 72t distributions this month. I also want to split my IRA into two IRA's 2/3rds 1/3rd for future planning flexibility. However, I am concerned about which balance i can use to do my calculation. My current balance is $745,258. I know i need to split the IRA's prior to distributions - continued...

switch to rmd method

>>can she look at the calendar year as opposed to the "payment year"?Individual taxpayers operate on a calendar year, not a fiscal or payment year - the SEPP also operates on a calendar year basis.>>will she have to wait until 2009 to make the switch?It depends on the dates of the distributions - if enough distributions to qualify to be rolled over - continued...

switch to rmd method

customer began sepp in may of 2007. date of birth 2/2/1952. distributions were based on the amortization method and are taken monthly. customer now wishes to switch to the rmd method. here are several questions:

1. what account value should be used for the calculation? based on - continued...