72T Distributions Combined with Regular Income
L1: 72T Distributions Combined with Regular IncomeI have been receiving 72T payments for more than 5 years. Recently, I started working again. Will I be able to continue receiving 72T distributions and earn income or is this not permitted?2012-08-23 04:45, By: sharon16, IP: [126.96.36.199]
L2: 72T Distributions Combined with Regular IncomeIt is not only permitted, it is required that you continue SEPP 72-T distributions until the later of age 59 1/2 or 5 years (60 months). If you are now 59 1/2, since you say you have received payments for 5 years, you are permitted to take any distribution from -0- to your full SEPP IRA balance.
If you are not yet 59 1/2, and if you do not need as much SEPP 72-T distributions, you are permitted a one-time change in your distribution calculation by changing to the other method which will permanently lower your annual distribution. However, that change is effective only on a calendar year basis, so if you decided to change in Sept for example, then the retroactive calculation for 2012 at the lower rate might have already been exceeded by your 2012 distributions to date. Usually I would suggest that you consider this change for January 2013. In addition, you should consider your respective tax rates in 2012 and 2013, etc. before you make the change.2012-08-23 13:07, By: dlzallestaxes, IP: [188.8.131.52]