L1: 72tIf I have a 72t set-up in my IRA and I transfer to another IRA and continue the same amount of monthly income from my original 72t, will this trigger 10% penalty on all past withdrawals? The 72t was started in 2010 and I am only 55 now.2013-03-22 16:28, By: 72 t question , IP: [188.8.131.52]
L2: 72tAre yoou transferring 100% of the IRA assets to a new IRA that has no current value?2013-03-22 16:39, By: Gfw, IP: [184.108.40.206]
L3: 72tYou may do a trustee to trustee transfer of SEPP assets from one custodian to another without incurring a penalty if this is your question?2013-03-22 17:34, By: Scott, IP: [220.127.116.11]
L4: 72tScott… he can only do the transfer without busing the plan if the assets are being transferred into a new IRA with no balance before the transfer occurs.
That’s why I asked the question.2013-03-22 17:51, By: Gfw, IP: [18.104.22.168]
L2: 72tSo we are transferring a Hartford IRA to a brand new IRA that has never been funded. Hartford is saying that if we move it, the prior distributions will be coded as premature distributions and the new company will code them that way as well since the 72t was not set-up through them and we are just telling them how much to take and for how long.2013-03-22 19:20, By: 72t, IP: [22.214.171.124]
L3: 72tAs Scott said, do a trustee to trustee transfer and all should be Ok.
Hartford may code any distributions received this year as pre-mature and the new company may do the same, that doesn’t mean that you can’t still get the exemption. There is nothing in the IRS code that prohibits 100% transfers from one custodian to another – that aone will not bust the SEPP.
You will probably have to familiarize yourself with IRS form 5329 and claim your exemption that way.
Are you talking directly to Hartford or to the Hartford agent that sold your the IRA? If Hartford directly, they are wrong. If the agent, he is probably trying to protect his comission interests.2013-03-22 19:34, By: Gfw, IP: [126.96.36.199]
L4: 72tThe money is moving from Hartford to Sammons. Hartford said they would get put as pre-mature distributions2013-03-22 20:43, By: 72t, IP: [188.8.131.52]
L5: 72tMy SEPP distributions are coded as pre mature on my 1099 from Fidelity even though I provided them with the SEPP calculations, so I use IRS form 5329 for the exemption from the 10% penalty. Sounds like the Hartford agent may be making deceptive statements.
Remember to make sure your annual distribution is equal to within a few pennies. Also, YOU are ultimately responsible for your SEPP, and not the custodian. This is why they code it pre mature to avoid any responsibilty.2013-03-22 21:35, By: Scott, IP: [184.108.40.206]