Recalculation of 72t Distributions

L1: Recalculation of 72t DistributionsWe have a client using the amortization method at an assumed interest rate of 8%. She was 48 when she started the distributions and is now 51. In checking with the annuity company where the account is invested, they said we could reduce the distribution by using the single life expectancy table to calculate a required minimum distribution. A second annuity company said the calculation is a combination of the required minimum distribution tables and an assumed interest rate of 120% of the mid-term treasury rate. My question is which is correct? And, if you choose the required minimum distribution method, can you get an amount that is somewhere between the current distribution rate which is depleting the account and the required minimum distribution which is about 1/3 of the current distribution and may not give the client enough income?2003-02-14 12:01, By: Ellen, IP: [127.0.0.1]
L2: Recalculation of 72t DistributionsThe second annuity company is wrong. The only method available for the one-time switch is the RMD method. And the answer to your last question is no. If you are using the single life table and the RMD method, that is the highest payout you can acheive.2003-02-14 12:05, By: WLE, IP: [127.0.0.1]