72t distribution and IRA contirbution

L1: 72t distribution and IRA contirbutionI am 52 years old and started a 72t distrubition three years ago. I have now gone back into the workforce and am making enough money to allow for a contibution back into an IRA. I understand I will have to open a new IRA and cannot touch the exsisting 72t IRA, which is fine. My questions is, can I show 72t IRA withdrawals on my 1040 form and also show a deduction for IRA contributions in the same year without rasing some “questions” from the IRS, i.e. is this legal?
2006-02-19 12:53, By: Jackson, IP: [70.250.202.92]

L2: 72t distribution and IRA contirbutionWill it raise questions? It shouldn’t, but then who knows what raises a red flag? With that said…
As long as you qualify for an IRA, there is no problem with making additional contributions.
As far as the SEPP is concerned, it operates within it’s own universe – just don’t commingle SEPP and non-SEPP funds. If you are seeking to minimize the distributions, review your options with regard to the one-time switch to the Minimum Distribution method.
Keep good records and you should have no problems.
2006-02-19 17:16, By: Gfw, IP: [172.16.1.70]

L2: 72t distribution and IRA contirbutionThanks for your quick reply. I was worried that showing an IRA distribiution and an IRA contribution on the same 1040 form was not legal, or would kick me out for an audit (even though have nothing to hide who needs the aggravation) even if they were different IRAs.
I did look into changing my distribution method to minimum, but I can make things work fine as is. Besides, who knows what will happen before I am 59.5?
Thanks,
Jackson2006-02-19 18:14, By: jackson, IP: [70.250.202.92]

L2: 72t distribution and IRA contirbutionGood point. Initially a SEPP plan is a helpful tool to manage around the undesirable early withdrawal penalty. It has a 5 yearminimum term, and to the extent you lengthen that term by starting the plan before age 54, you end up increasing the chancesof the helpful tool turning into something less desirable in it’s inflexible nature and becoming something in itself that has to be managed around.
Having the new IRA with a different custodian from the SEPP provider should reduce the chances of IRS inquires, as the 5498 will show the diferentissuer.2006-02-20 13:13, By: Alan S., IP: [24.116.165.157]