Age 55 does it make a difference in 72 T ?

L1: Age 55 does it make a difference in 72 T ?In reading the last post it appears that actually retiring when you are 55 impacts the way you take 72 T? Is that correct? Can someone explain that to me?
My husband turned 55 on 12-12-03. He will be retiring on 3-1-04. What do we have to do or what should we be asking an advisor?
Thanks, this site is very helpful.

Linda2004-01-16 09:03, By: lrobey, IP: [171.75.230.201]

L2: Age 55 does it make a difference in 72 T ?Hello Linda:
IRC 72(t) contains many exceptions to the surtax; two of which are:
72(t)(2)(A)(iv) — substantially equal periodic payments; AND all the computational rules that go with them.
72(t)(2)(A)(v) —- separation of service at age 55 — allows penalty free distributions provided:
1. Employee retires from employer @ age 55 or will attain age 55 in the year of retirement.
2. Assets remain in the employer plan & are NOT rolled over to an IRA.
3. Plan permits periodic distributions.
Meet all 3 requirements and the taxpayer can withdraw whatever they want whenever they want without penalty & without being subjected to the computational rules of SEPPs.
TheBadger
wjstecker@wispertel.net

2004-01-16 09:21, By: TheBadger, IP: [38.116.134.130]

L2: Age 55 does it make a difference in 72 T ?Employer operates a 403(b), 457(b) and 401(k). The employee will be retiring this July at age 56. The 403(b) investment options are quite limitedbut the employer permits upon separation a rollover from the 403(b) to the 401(k). Retiree is desirous of making surtax free withdrawals from the 401(k) account starting at age 56. Does Section 72(t)(2)(A)(v) apply?2004-01-22 11:51, By: The Columnist, IP: [67.81.212.116]