72 (t) transfer

L1: 72 (t) transferIF A CLIENT IS DOING 72 T AND TRANSFERS TO ANOTHER COMPANY AND CONTINUES 72 T DOES THIS STILL AVOID THE 10% PENALTY OR IS CLIENT STUCK IN CURRENT COMPANY UNTILL 72 T IS COMPLETED2004-06-09 09:47, By: HOFFMAN, IP: [63.224.195.161]
L2: 72 (t) transferNo problem on the transfer. Just watch how your 1099 is coded. You may have to file5329 2004-06-10 10:41, By: Gfw, IP: [172.16.1.71]

L2: 72 (t) transferIf a client completes the 5 year distribution and age 59 1/2 rules in the middle of the Calendar Year, and then makes a “trustee-to-trustee”transferof hisIRA to a new custodian, is there any tax reporting? I know it will generate two 5498 forms in the year of the move, but is there anything else to look out for?
Jim2004-06-10 13:13, By: Jim, IP: [68.225.115.136]

L2: 72 (t) transferMy 1st guess is that the 1st Trustee/Custodian won’t use a code of 2 on the 1099, so 5239 may have to be filed with the tax return – can’t think of anything else.2004-06-10 13:22, By: Gfw, IP: [172.16.1.71]

L2: 72 (t) transferOK. I give up!
What is the key to get the IRS Web Site to find Form 5239? I have tried every search technique I can think of and can’t get anything close. Got a copy you might e-mail to me? What Pub covers this form?
Thanks
Jim2004-06-10 14:06, By: Jim, IP: [68.225.115.136]

L2: 72 (t) transferDoesn’t suprise me that you couldn’t find the form as I don’t think 5239 exists, you caught me on a typo – but form 5329 does exist and can be found at http://www.irs.gov/pub/irs-pdf/f5329.pdf 2004-06-10 14:29, By: Gfw, IP: [172.16.1.71]

L2: 72 (t) transferThank you very much. I found the form and 4 page instructions.
Let me try this scenario for your ideas. SEPP has been going for over 7 years now, and client will hit age 59 1/2 this month (June) and take his last distribution on the 25th. So for the July distribution heshould be clear to change the amount. To be on the safe side, I think we will let July go as part of SEPP with the current custodian.Then I’ll move the IRA in August and set up “Normal” distributions from the new custodian.
If this works, the old custodian should report “Early Distribution with Exception” and the new custodian should report “Normal Distribution” after age 59 1/2.
Do you concur?
Jim2004-06-10 15:17, By: Jim, IP: [68.225.115.136]

L2: 72 (t) transferIn reality, that should happen whether or not there is a change in custodians as two 1099s should be generated, one for before age 59.5 and one for after. 2004-06-10 15:32, By: Gfw, IP: [172.16.1.71]