72t calculation

L1: 72t calculationour account is at 374000 our ages are primary 54 and 47 useing decembers rate of 4.97% i came up with a monthly payment of $1548.98 is this correct. and what is the cut off date for useing dec interest rate?
also whats the max amount in cash we can add to the account annualy after starting the 72t2008-01-28 10:15, By: warrep, IP: [76.98.150.60]

L2: 72t calculationThe “maximum amount you can add to the account in the future” is ZERO !!!! If you add $ 10 you BUST the plan, with serious consequences (!0% penalty retroactively on all distributions cumulatively from the start of the plan).
Further, why would you start a plan with all of your accounts if you expect/hope that you will have future earnings which you could use instead of taking distributions ? However, if you do get a future job, you can make CONTRIBUTIONS to IRAs for one or both of you ($ 5,000 under 50, $ 6,000 over 50). These can be TRADITIONAL IRAs which would be deductible from your taxable income, or non-deductible if contributed to a ROTH IRA. (Making “non-deductible TRADITIONAL IRA contributions” is not advisable in your situation, or anyone”s who has significant TRADITIONAL IRA balances already).
You could also set up 2 SEPP 72-T accounts, take distributions from both, but have less exposure if you bust one of them. I would suggest 2/3 1/3 or 3/4 1/4 allocation for this approach.2008-01-28 11:02, By: dlzallestaxes, IP: [141.152.255.16]

L2: 72t calculationthanx for the quick respounse could you answer the other questions also
2008-01-28 12:29, By: warrep, IP: [76.98.150.60]

L2: 72t calculationThe Dec 2007 max rate can be used for plans that have first payment made in either JAN or FEB 2008. The age (that you will attain in 2008!!) of the person doing the SEPP that will start in 2008 is the one you use to compute the plan, and just check off single life when doing it. The amortization choice yields the highest payment, and then if you win the lottery, you can switch back to the RMD method for the rest of your SEPP required years to reduce the payments. That requires annual recalculations. If you choose Amortization, I”d suggest just doing a plan where the payments are the same each year, rather than complicating things by selecting recalculation (of interest, age, and plan balance) at the beginning of each year. Does that help? As DZL (or is it DLZ) said, don”t add anything (and I”ll add ..or taken anything else out) of the IRA that you choose for your SEPP plan other than the exact payments that your plan requires each year.
KEN2008-01-28 15:32, By: Ken, IP: [75.67.65.254]

L2: 72t calculationREVISION TO ABOVE POSTING… I can”t seem to EDIT it….
The Dec 2007 max rate can be used for plans that have first payment made in either JAN or FEB 2008. The age (that you will attain in 2008!!) of the person doing the SEPP (the IRA owner) that will start in 2008 is the one you use to compute the plan, and just check off single life when doing it–forget the spouse”s age. The amortization choice yields the highest payment, and then if you win the lottery, you can switch back to the RMD method for the rest of your SEPP required years to reduce the payments. That switch to RMD requires annual recalculations. Which method are you using in your example? I could not match your figures. If you choose Amortization for your regular plan, I”d suggest just doing a plan where the payments are the same each year, rather than complicating things by selecting recalculation (of interest, age, and plan balance) at the beginning of each year. Does that help? As DZL (or is it DLZ) said, don”t add anything (and I”ll add ..or taken anything else out) of the IRA that you choose for your SEPP plan other than the exact payments that your plan requires each year.
KEN2008-01-28 15:46, By: Ken, IP: [75.67.65.254]

L2: 72t calculationi took 374000 times .0497 and devided by 12 …is this right?
also if the value of the account goes up through trading of stocks and options is that ok??2008-01-30 06:58, By: warrep, IP: [76.98.150.60]

L3: 72t calculationwarrep – I do believe you have created a problem. To determine the annual distribution use the starting balance and the calculator on this site. Using an interest only calculation will only result in the payment of the 10% penalty tax since you will merely be taking distributions and you won”t have a SEPP Plan.2008-01-30 07:06, By: Gfw, IP: [216.80.125.206]

L2: 72t calculationwarrep – I do believe you have created a problem.
To determine the annual distribution use the starting balance and the calculator on this site. Using an interest only calculation will only result in the payment of the 10% penalty tax since you will merely be taking distributions and you won”t have a SEPP Plan2008-01-30 07:16, By: Gfw, IP: [216.80.125.206]

L2: 72t calculationuseing the sepp calc 2002-62
ages 54 and 47
amount 374000.00 both boxes
interest rate 4.97 in both boxes
irs penalty 7%
i get three numbers min $1021.86/mo
amort $2005.88 mo
annut $1984.89 mo… so do i just pick the one that best suits my needs ?2008-01-30 08:08, By: warrep, IP: [76.98.150.60]