How Can We Help?
< Back
You are here:
Print

Monthly or Yearly?

Posted
Last Updated On
Byrich

L1: Monthly or Yearly?I will begin SEPP distributions in January 2002. I plan to take a single withdrawal each January. Is there a reason I should not make a single withdrawal and opt for monthly or some other variation? I’d like to keep it simple. 2002-01-09 16:18, By: Rich, IP: [127.0.0.1]
L2: RE: Monthly or Yearly?Pick either option, put it in writing as part of the plan, and then stick to the plan.Good luck!2002-01-09 16:21, By: Gfw, IP: [127.0.0.1]

L2: RE: Monthly or Yearly?What about taxes? Unless we have some withheld, don’t we “technically” have to include the entire amount in the 1Q Estimated Tax payment? A bit painful!?!And, taking it monthly leaves more in the tax deferred account to potentially grow at a higher rate of return. But it does not alter the SEPP calculation. We would just yank out 1/12 each month.My 2 cents, FWIW. Please set me straight if I’m off base.Best regards,John2002-01-09 17:27, By: John, IP: [127.0.0.1]

L2: RE: Monthly or Yearly?Never really looked at it from the estimated withholding, but my guess is that (I’m not an accountant, but my wife is) you are right – big estimated payment on an annual withdrawal.If it were me, I would merely take the annual and divide by 12.2002-01-09 17:34, By: Gfw, IP: [127.0.0.1]

L2: RE: Monthly or Yearly?I just learned from The Motley Fool Tax Strategies Board that unless one uses the Annual Income Method and form 2210, it’s OK to take the lumpsum and do quarterly estimated tax payments, thus treating it as an annual amount.I still like taking the monthly distributions as you suggest. That provides a constant known income stream to budget against.Thanks,John2002-01-11 08:46, By: John, IP: [127.0.0.1]

Table of Contents