L1: 2nd distribution
I took my 1st SEPP distribution (Amortization) in Dec 2011 per the calculator at 72t net. Now, I want to take my 2nd SEPP distribution.
Question – Do I need to run the calculator again to find out the amount of the 2nd distribution? Or, is the distribution amount the same as in 2011?
2012-01-09 13:13, By: RC, IP: [126.96.36.199]
L2: 2nd distribution
Your 2012 annual distribution will be the same as your annual calculation for 2011, regardless of whether you took out 1/12 of the 2011 annual amount in December or the full year amount. Therefore, you donot need to rerun the
The only time you would change the annual distribution from here on would be if you wanted to reduce your annual payment by making a one time switch to the RMD method, and that is usually done much later in your plan if at all.
From here on, each full year in your plan should result in the same annual distribution and therefore the same amount on your 1099R. There is an exception for the final year of your plan. Be sure you know when your plan will
end. You will need to file Form 5329 to claim the penalty exception unless your 2011 1099R shows code 2.
NOTE: The IRS does authorize recalculated plans, but we do not recommend them here unless there is a unique reason. They are rarely used and require you to recalculate everything at the same time each year using updated age,
interest rate and account balance. I assume that you do NOT intend to attempt such a plan unless you post otherwise. Again, we do not recommend recalculation be used. This is different than the one time switch to RMD noted above.
2012-01-09 16:27, By: Alan S., IP: [188.8.131.52]
L3: 2nd distribution
Alan – thanks for the quick reponse. Will keep it simple and proceed w/ withdrawing the same amount now as I did last year; and will repeat it for subsequent years as well
2012-01-09 16:58, By: RC, IP: [184.108.40.206]