Additional withdrawls from 72t

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L1: Additional withdrawls from 72tWe are going to establish an IRA account to take 72t distributions. Client is 53, not married. Is she able to take additional distributions/ withdrawals from this 72t IRA without being assessed the 10% penalty (on thedistribution above the 72t withdrawal)or triggering the IRS to disallow the 72t distributions (thus declaring she owes the 10% penalty on all of the distributions)?2009-02-03 20:06, By: ED, IP: []
L2: Additional withdrawls from 72tEd:Once you establish an IRA account for 72(t) distributions, then you may only take the calculated distribution amounts from that IRA account. If you can split the IRA into two accounts, one for 72(t) and the other for “emergencies” or other such withdrawals, then you have a workable plan.The only three exceptions for changing the calculated distribution amounts from a 72(t) Plan IRA account are: (1) Death and (2) Disability … neither of which are very desirable alternatives … or (3) a switch from either the Annuitization or Amortization methods to the RMD Method.Early withdrawal exceptions like education,health insurance premiums for unemployed, etc., (see IRS Pub 590 for more details) are not allowed from an active 72(t) Plan account. That’s why you want to set up an emergency account if at all possible.Jim2009-02-03 20:20, By: Jim, IP: []

L2: Additional withdrawls from 72tJim summed it up nicely. Let meadd that oncea 72t plan is started, it must continue for the longer of 5 years or age 59.5.Unless client turns 54 sometime this year, a 6.5 year plan would result from starting a 72t plan this year.2009-02-03 23:52, By: Ed_B, IP: []