72(t) Calculation Method Switch Question

L1: 72(t) Calculation Method Switch Question
Scenario: Investor is taking 72(t) distribution from an IRA under one of the fixed methods. He decides he would like to switch to RMD method mid-year. The payments received under the fixed method already exceed the required amount under the RMD method. Theschedule was originally established 4 years ago.Questions: 1) Can the switch occur this year? 2) If so, how much, if any, needs to still be taken as a distribution? 3) What happens to excess withdrawal under fixed method, if switch can occur? Any help would be appreciated. Also, if you can site your source, that would be excellent! My question is specific to the exact scenario presented above. I simply cannot find a definitive answer anywhere that addresses this specific issue. Again, the issue being the desire to switch to the RMD method mid-year where your required distribution under the fixed method exceeds the required withdrawal under the RMD method.
Thanks in advance for your time. Brian2006-06-22 17:53, By: Brian E., IP: [12.155.246.10]

L2: 72(t) Calculation Method Switch QuestionHello Brian:
I strongly susepct that this will be a “facts & circumstances” decision. There a variety of issues: (a) has the taxpayer been taking “pro-rata” distributions on a monthly basis throughout 2006; (b) how much can be rolled back into the IRA to backup the conversion date; (c) how much is the taxpayer already over-distributed for 2006.
Given that this taxpayer started their SEPP plan in 2002; there is a special transition rule in Revenue Ruling 2002-62that permits the taxpayer to switch from their current methodology to the RMD method “AT ANY TIME”. Though no one ever knows with certainty, this has been interpreted (and ruled upon in one or more PLRs) as a literal interpretation including a mid-yer election to switch as opposed to only year-end switches.
TheBadger
wjstecker@wispertel.net
2006-06-23 09:17, By: TheBadger, IP: [66.109.211.254]

L2: 72(t) Calculation Method Switch QuestionBrian,
Just be sure the investor understands that switching to the RMD is a one-time deal.
(S)he can”t switch strategies up the road without busting.2006-06-28 12:41, By: francis3, IP: [151.203.196.3]