72 t account transfers

L1: 72 t account transfersFacts of my case:
age 57 male
2 ira accounts
Account #1 has 500,000 – account #2 has 400,000.
SEPP made from account #1 for 3,000.00 per month and started at age 52.
no payments made from account #2
market downturns are causing me concerns and I want to change custodians.
Plan:
Leave enough money to continue SEPP with the current custodian until I turn age 59.5
transfer the balance fromaccount #1 to a new custodian with out commingling the funds with account #2.
transfer account #2 to the new custodian in tact but in a separate account.
As I understand 72t, as long as the integrity of the account providing the SEPP Payment is not modified, transfers are acceptable.
Is this correct and if not how can I make a transfer without violation of the rule?

2007-11-13 13:52, By: cheech, IP: [24.96.168.82]

L2: 72 t account transfersWhile you never took payments from Acct 2, that does not mean that the balance in that account was not considered when you initiated your plan. Be totally sure that Acct 2 was never a part of your plan in any way.
If the above provision is correct, you could either:
1) Directly transfer Acct 1 in total to a new custodian and continue your SEPP from there. Be sure that the amounts distributed for each year are exactly correct. Partial transfers could create a problem, but you should be OK with a complete transfer. Your first option appeared to consider a partial transfer, and that could bust your SEPP under a recent lRS letter ruling.
However, a change of custodians is not going to change a market correction. You can change the type of investments in your present account if you do not like the current choices, unless you are with a bank or other firm with limited choices, OR
2) Leave Acct 1 alone and change your investments in Acct 2, and/or change custodians for Acct 2. This carries less risk for error than transferring Acct 1.
Since you already have 5 years in your plan and only 2 plus years left, you should be particularly careful.

2007-11-13 15:26, By: Alan S., IP: [24.116.165.60]