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72T Recalculation

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Byarin

L1: 72T RecalculationI was wondering if the IRS has made any new rules re: recalculating the 72T Distributions. We have many clients that set theirs up years ago when the market was earning above 8%. It is now below it and the clients are getting double-dinged. Not only are they taking out more than they want, they are loosing money too. I heard a couple of months ago that the IRS was working on a private letter ruling, but I haven’t heard if anything has come of it yet. Any info would be great. We just want to stop the bleeding.Thanks!2002-09-23 17:09, By: arin, IP: [127.0.0.1]
L2: 72T RecalculationHello Arin:Page back & see my post on 9/1/02 for a more thorough comment on the situation. The best advice I can offer at the moment is to segregate your clients into two categories: one, those in immenent danger; two, those that can wait a while. Group one should at least file individually for a PLR so that their specific issues get solved this fall or early next spring. Group two should wait & see what pronouncements are forthcoming from the IRS & then take some form of action.TheBadgerwjstecker@wispertel.net 2002-09-23 21:31, By: TheBadger, IP: [127.0.0.1]

L2: 72T RecalculationI wonder just how many of us are in the situation described by arin! I am locked into a monthly distribution of 10% as was advised by my then financial planner 2 1/3 years ago. Now that my account is less than 50% of what it was when I began, I am still locked into 10% of the original amount of my retirement account, which just continues to go down at an alarming rate! How does one begin to file for an individual PLR as advised by The Badger? Just sitting and waiting for action from the IRS while the bleeding continues is really very painful! Please adivse. Thanks.2002-09-24 12:32, By: Duey, IP: [127.0.0.1]

L2: 72T RecalculationFiling for a PLR is not as difficult as one might think. First, there is the IRS filing fee of either $600 or $3,270 for gross income under / over $200,000 respectively. Second, unless you have been through the process before, I would strongly advise hiring a professional to prepare (and subsequently argue) your private letter ruling request in front of the Assistant General Counsel’s office which essentially the policy making body on these issues at the IRS. Typical fees for a pro to prepare the PLR can run the gamit from, I suspect a low of $2500 to as high as $10,000 depending on case complexity as well as who you hire.I would suggest that the right way to look at the issue is to compare what penalties & interest you are currently looking at versus a minimum of $3000 to get out of the situation. A good tax lawyer and/or tax accountant should be able to tell you in 30 minutes what your chances are of getting a favorable ruling from the IRS based on your specific facts & circumstances and there should be no charge for that consultation. After that the meter starts running & no tax pro on the planet will guarantee a favorable result.TheBadgerwjstecker@earthlink,netP.S. I am for hire for those individuals willing to work long distance.2002-09-24 17:30, By: TheBadger, IP: [127.0.0.1]

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