Other reasonable Method

L1: Other reasonable MethodIs there something written in the 72t code that says you are are allowed to use “any other reasonable method” in addition to Min. Distribution, Annualized, and Annuitization methods?
Thanks2005-10-05 09:44, By: freddy, IP: [69.174.91.173]

L2: Other reasonable MethodWhat are you trying to do that differs from what is available from these 3 methods ? How much is in your IRA(s) ? What is your exact age ? How much are you looking to withdraw ? Is it significantly more, or significantly less, then the calculated amounts ? If your needs exceed the calculations, are there any other sources of funds that could cover the “short fall” ?2005-10-05 09:54, By: dlztaxes, IP: [4.175.9.60]

L2: Other reasonable MethodMy account balance was approx. 514,000 when I started taking didtributions on Sept 1, 2004. I have been receiving $3500 (gross) per month ($3010 net) since then. My account rep says this amount is within the “other reasonable amount”!!
Thanks
2005-10-05 09:59, By: freddy, IP: [69.174.91.173]

L2: Other reasonable MethodI forgot to to give my age. I was 48 when the first distributions began in 2004.
thanks2005-10-05 10:03, By: freddy, IP: [69.174.91.173]

L2: Other reasonable MethodHi Freddy:
Thanks for the additional information. May I suggest that you go to the home page and get into the calculators provided, and use the original data to try creating your monthly distribution amount. If you get the same answer … not likely … then you’re OK. If you get a different answer … likely … then make some real fast corrections to either withdraw more or return some funds to your IRA under the 60-day rollover rule.
Also, go to the List of Postings and check out “Tim” about six posts down, counting yours, and you’ll see how a bank made an error by using “divide by 10” to calculate distributions.
Now to answer your original question: No, there are only three acceptable methods which are Minimum Distribution, Ammortization, and Annuitization.
Good luck.
Jim2005-10-05 10:10, By: Jim, IP: [70.184.1.35]

L2: Other reasonable MethodOOPPS!
I looked back at your informational posts and see you started Sept, 2004, and not 2005. I thinik you will have a problem. Your only solution may be to accept a “bust” and pay penalty and interest on previous distributions, then start a new SEPP using the correct information and an acceptable calculation method.
Or
TheBadger my weigh in on a new PLR method to correct screw-ups.
Jim2005-10-05 10:15, By: Jim, IP: [70.184.1.35]

L2: Other reasonable MethodBy the way, 14% is an odd amount to be withholding ( $ 3,500 gross – $ 3,010 net = $ 490 withheld on $ 3,500). That will be $ 5,880 withheld. That would be the tax on $ 36,000 taxable income, which would be about $ 3,000 of taxable income other than your SEPP 72T, after deducting the standard deduction ($ 5,000)and personal exemption ($ 3,200)assuming you are single.2005-10-05 10:23, By: dlztaxes, IP: [4.175.9.60]

L2: Other reasonable MethodHello freddy:
I am sorry to be the bearer or bad news; however, based on $514,000, age 48 (life expectancy of 36.0) andan interest rate of 4.94% (the highest allowable for distributions beginning in 9/04), the maximum annual distribution amount was $30,825 or approximately $2570 per month gross.
To-date there have been no”other reasonable methods” approved by the IRS in any form. Therefore, your financial advisor is way off base; at least on this tax issue.
My advice; do two/three things very quickly:
1. If possible, get something in writing from your advisor that your current distribution stream is okay; however, do not be at all surprised if you get some very fast back- pedaling.
2. Stop your distributions.
3. See the qualified professional of your choice; either a tax CPA or tax attorney to discuss potential courses of action.
TheBadger
wjstecker@wispertel.net
2005-10-05 15:35, By: TheBadger, IP: [66.250.23.21]