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Switching Custodians

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Byshawn

L1: Switching CustodiansI”m an advisor in NJ. My client took out a VA (IRA) about 3.5 yrs. ago. he”s in the middle of a 72t schedule. He”d like to move the entire value to another custodian because of the newer guaranteed income riders available which were”t when he invested originally. Can this be done without any consequence to the 72t already in progress?
SD2007-06-18 06:09, By: Shawn, IP: [205.188.116.8]

L2: Switching CustodiansGood morning Shawn:
Generally you can change custodians for an active 72(t) without IRS problems. Having said that, there is an active discussion on this board about the IRS disallowing splitting up IRA”s with active 72(t)”sto different custodians. I don”t know how that is going to work out and I see there is a new post on this subject which I haven”t read yet. But to your particular problem, if the IRS will allow 100% transfer from one custodian to one new custodian, you will face a new challenge that can only be answered by the new, VA / IRA custodian.
The question for the new custodian is, will they accept the current parameters for the existing 72(t) distribution plan? They may not accept the current paramenters and will insist on basing distributions on the dollars they receive in the transferand the current age and interest rate assumptions.
Please let us know what the new custodian says.
Jim2007-06-18 06:46, By: Jim, IP: [24.252.195.14]

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