72(T)

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L1: 72(T)First is a 72(T) and a SEPP the same or is a SEPP a different ype of account for retirement?
I would like to know on my 72 -T which I started when I was 53 1/2and I am now a little bit over 55. Can I stop taking funds out of it all together or becasue I signed up to get the 72-T I need to continue it? I am writing this as I am the lady that had the terrible error made when I transferred my accounts from one investment firm to another. where my 72(T) did not continue as I thought it had all been taken care of. so I now have to pay 1395.00 in Penalities. I do have a trust account that I can take funds out of and cash in stocks to supplement my income but….is it wrong or a bad idea to have a 72(T). Lets put it this way. I want to be able to live reasonably comfortable and I cannot imagine living pass 75 years old when most of my family has passed on before 80 years old.

I have marked on the agreement that Substantially Equal Periodic Payments (cod 2) You are under 59 1/2, and you will continue this distributions schedule for the greater of 5 years or until you reach 59 1/2? Now does that mean at 59 1/2 I do not have to continue the 72 (T) or is this like an annnunity and I have to continue till it is depleted? My accounts are 2 IRA”s and one Trust account. I am having Federal income tax held at a rate of 15%. My yearly income from work and a small retirement check from the state comes out to be right around 17,000 dollars a year. I am widowed and have no children under 18.
I feel liek I am smashed in the middle of not knowing what to do from this point?

Thank You!
2003-02-24 22:46, By: Jude, IP: [127.0.0.1]

L2: 72(T)Neither is an account, but both are a means of accessing the IRA account without the incurring the 10% penalty. A SEPP (Substantially Equal Periodic Payment) plan is one of the exceptions listed under Internal Revenue Code Section 72(t).

You can always stop a SEPP plan as long as you understand that there will be back penalties and interest due on past due penalties if the plan stops before the later of 5-years or age 59.5. Once the plan has been in existence for the prescribed period, distributions may be stopped until reaching age 70.5 when Required Minimum Distributions need to be started.

Two suggestions_ 1) Read the information on this site, including the FAQ sections; and 2) Consider getting some professional advice from your accountant/attorney.2003-02-25 06:48, By: Gfw, IP: [127.0.0.1]