Penalties if IRA Runs Dry?

L1: Penalties if IRA Runs Dry?My IRA has lost significant value in the past 2 years. Based on current distributions, it will be depleted before age 59 1/2, after about 7 years of distribution. This is OK with me, as I will not need the distributions after that time. My question is, if an IRA runs dry before 59 1/2, does the IRS currently consider that a violation of the substantially equal distribution rule and assess penalties back to the original distribution date? Or, do they forgive the penalties simpy because the plan was depleted? Thanks for the reply.2002-08-01 08:54, By: Maggie, IP: [127.0.0.1]
L2: Penalties if IRA Runs Dry?Hello Maggie:You have hit the HOT TOPIC OF 2002; that of “premature account exhaustion”. Unfortunately, there is no current correct answer.My opinion, as well as most but not all others, is that “exhaustion” does trepresent a modification and will therefore cause 72(t)(4) to be enforced; e.g. the 10% penalty plus interest.However, my opinion does not make it right. In reality there is no law in this specific area as it has never come up before now. In this regard, you have three potential choices:1. Do nothing and take your lumps if they come.2. Pray for some legislation or favorable IRS public rulings in this arena.3. File for your own private letter ruling.TheBadgerwjstecker@wispertel.net2002-08-01 09:45, By: TheBadger, IP: [127.0.0.1]

L2: Penalties if IRA Runs Dry?I have been following this chain with interest,I too have a 72T IRA that is definitely going to go dry. However, it was carved off of my larger IRA account before I bagan drawing. Here is anoth question just to muddy the waters.Can I replenish my 72T account with assets from my other IRA accounts?2002-08-01 15:47, By: Patrick, IP: [127.0.0.1]