72t Account Balance

L1: 72t Account BalanceI”m trying to determine the “right account balance” to use to calculate my payout for 72t. I would be using the amortization method. So no need to recalcuate every year. My broker thinks the safe thing to do is use last years 12/31 balance. However, I have looked at several sites including this one and see just as much evidence for using a balance during the year up to the distribution date. Am I truly allowed this discretion, in my case the difference between the 12/31 balance and my current balance will be as much as 3000 dollars but i still would prefer the larger balance since the payment will of course be locked for the next 8 years in my case, im 50 1/2. Thanks for any recommendations. 2007-09-02 20:50, By: Darrel, IP: [207.69.137.8]
L2: 72t Account BalanceNEXT 9 YEARS since you state you are 50 1/2 !!!!2007-09-03 11:09, By: dlzallestaxes, IP: [141.152.251.240]

L2: 72t Account BalanceDarrel,
I recall recently seeing a post from Alan S, where he advised the person that the beginning IRA balance used in calculations cannot be from more than six months prior to the start (1st payment) date of the plan. To be safe, I would suggest using a month end account balance close to the month you plan to start your plan, and not go back to 12/31/06 if you are starting the plan this late in this year. KEN2007-09-03 12:27, By: Ken, IP: [75.67.65.254]

L2: 72t Account Balance
First, let”s look at what Re.Rule 2002-62 has to say on this subject:
(d) Account balance. The account balance that is used to determine payments must be determined in a reasonable manner based on the facts and circumstances. For example, for an IRA with daily valuations that made its first distribution on July 15, 2003, it would be reasonable to determine the yearly account balance when using the required minimum distribution method based on the value of the IRA from December 31, 2002 to July 15, 2003. For subsequent years, under the required minimum distribution method, it would be reasonable to use the value either on the December 31 of the prior year or on a date within a reasonable period before that year”s distribution.
In today”s world of instanteous information, I am of the opinion that the closer the account valuation date is to the 1st distribution date, the better. However, this is not always possible. Some investors may have IRA assets that are only valued annually or quarterly as opposed to the typical brokerage IRA account. In short, the ruling is clear yet vague at the same time: “a reasonable manner based on the facts & circumstances”.
TheBadger
wjstecker@wispertel.net

2007-09-05 04:57, By: TheBadger, IP: [72.42.66.29]