Amount of Payout

L1: Amount of PayoutJust a quick question. If the calculation….annuitization for instance says I have to take say $22,000 out of the SEPP IRA, can I take $21,000? Do I have to tkae the EXACT amount or is the 120% just a ceiling?2004-04-15 14:13, By: JAG, IP: [172.136.27.33]
L2: Amount of PayoutIf, based on the assumptions used, the payment is $21,999.10 then you should take $21,999.10 – can you round off the dime? Yes, and even the dollar, but that’s about it. Once the payments are set – they must be followed!
If you want less, then change the assumptions like the interest rate, or sub-divide the account into multiple accounts.
2004-04-15 14:54, By: Gfw, IP: [12.221.34.192]

L2: Amount of PayoutWow…I thought you could pick a number (and stick with it) that was “no more than” 120% of the fed mid term rate. It doesn’t say anywhere that you have to take exactly the calculation amount you come up with. Do you have anything that says we can’t use a slightly smaller payout without changing any of the assumptions?
Example, payout calculation is $22,164.35 and I want to take $1,840/month which comes out to $22,080/yr? Just take $1847/mo?
Also, IfI wait until May’s interest rates some out, can I usethose figures and start distributions in May ot do I have to wait until June?
Finally, if I start in May, I only take out the prorated annual number for the rest of this year and the full annual amount next year and beyound correct?
Thanks!!
JAG2004-04-15 21:26, By: JAG, IP: [172.166.71.222]

L2: Amount of PayoutFirst, you may want to spend a little time reading the information on the site (including the FAQ), or if you like books, purchase Bill Stecker”s book for $39.95 (link on main site). You”ll get a much better understanding of exactly what a SEPP is and how it operates. The federal mid-term rate is used in the amortization and annuitization methods. The interest rate that may be used is any interest rate that is not more than 120 percent of the federal mid-term rate for either of the two months immediately preceding the month in which the distribution begins.Also read Rev. Rul. 2002-62 (left menu of main site) – it give the definition of what a SEPP is and the rules that must be followed.And finally, you may want to consider getting competent advice to make sue that you start and stay on course. 2004-04-16 04:30, By: Gfw, IP: [12.221.34.192]

L2: Amount of PayoutThanks!! I see that now. How about using May’s interest rates and taking distributions in May. From what I read, it says either of the two months preceeding the month in which distributions begin. That tells me June but I really can’t wait that long
JAG2004-04-16 14:52, By: JAG, IP: [69.34.87.36]

L2: Amount of PayoutIf payments begin in May, 2004 you may use any interest rate that does not exceed 4.01% (which is the higher of the March and April rates).2004-04-16 15:04, By: BillE, IP: [206.195.193.10]

L2: Amount of PayoutGfw…….is that true??
JAG2004-04-16 15:17, By: JAG, IP: [69.34.87.36]

L2: Amount of PayoutAbsolutely right. And in June, the max will be 3.81 which is the rate that just came out for the month ofMay. You may want to take advantage ofstarting in May if you are looking for a higher payment.2004-04-16 21:26, By: Gfw, IP: [172.16.1.72]

L2: Amount of PayoutThanks for the help.
JAG2004-04-17 14:43, By: JAG, IP: [172.203.230.233]

L2: Amount of PayoutLow rates right now, but wait a few months. My opinion, by the end of the year, the rate will be around 5.00%, maybe higher.
2004-04-19 06:48, By: G-T, IP: [24.145.242.199]