L1: amortization calculationshi my payment from Fidelity is different from the calculations from your site. Do not want to bust the plan.Can you please give me some guidance? 04/20/1959 age 54 518840.00 interest rate 1.31% payment1st distribution date 06/15/2013 20621.882013-11-20 16:15, By: nessaf, IP: [220.127.116.11]
L2: amortization calculationsI believe that Fidelity does their calculations assuming an beginning of year distribution and we assume an end of year distribution. Our calculations match the examples from the IRS, but both are probably Ok. I would get a copy of the calculations from Fidelity and keep them with your other documents.2013-11-21 21:44, By: Gfw, IP: [::1]
L3: amortization calculationsThanks for the reply.2013-11-21 21:47, By: nessaf, IP: [18.104.22.168]
L4: amortization calculationsI’m curious if you were able to obtain detailed information from Fidelity. I’m about to start my SEPP with them and they have not been very forthcoming. They are very willing to calculate a number and send me the annual payment but not willing/able to provide details about how they arrived at the number.2014-01-02 14:20, By: nvestysly, IP: [22.214.171.124]
L5: amortization calculationsI had the same thing happen to me I hope I didn’t make a mistake going with Fidelity.2014-01-09 17:56, By: nessaf, IP: [126.96.36.199]
L6: amortization calculationsI’ve seen numerous similar comments about Fidelity handling of SEPP 72-T plans.
I’ve seen numerous compliments about Vanguard’s handling of SEPP 72-T plans.2014-01-09 19:09, By: dlzallestaxes, IP: [188.8.131.52]
L7: amortization calculationsI began my 72t plan last yearusingan IRA I have with Fidelity. After reading and planning for over a year, using this site I calculated my own SEPP. I doubled checked the result in Excel and on other sites. Then I filled out the form for Fidelity to send my periodic payments and they have been sending exactly what I asked for. No problem whatsoever.
I see quite a few people complain about Fidelity but I think no matter who a person goes with the key is to do your homework.2014-01-09 19:53, By: PHH, IP: [184.108.40.206]
L8: amortization calculationsAfter much study at this site, I started my 72t in the fall of 2013. I have my IRA’s at fidelity, but kept them out of the loop, I just withdrawl my annual distribution on my timing.2014-01-09 20:17, By: Bob85364, IP: [220.127.116.11]
L5: amortization calculations – Fidelity is a nightmareI’m in the process of setting up a 72(t) with some assistance from the experience of people on this forum.
My money is at Fidelity, and my experience with them regarding setting up a SEPP has been, hands down, the worst I’ve ever had with a financial institution. They are execrable, dishonest, incompetent, cumbersome, and ultimately unnecessary to the whole process!
If you understand what’s discussed in this forum, YOU CAN DO IT BY YOURSELF WITHOUT FIDELITY. They add no benefit, provide no guidance, restrict your options, and won’t save you any time with the IRS. Here’s why:
The short version is that after more than 90 minutes on the phone with their people, the story I ended up with is that the ONLY way they will calculate ANY distribution amount for a SEPP is to enter an actual application into their system and irrevocably begin the SEPP. They say they are unable to provide any preliminary numbers or test calculation. Nobody in their entire company is able to do the calculation.
Furthermore, their 4-page form to initiate a SEPP only allows for annual, quarterly or monthly distributions. I wanted semiannual distributions – out of luck.
Then I saw buried in the fine print that by signing the form I acknowledge (among many other things) that “Fidelity will report all SEPP distributions to the IRS as ‘early distribution – no known exception applies.'” In other words, I’d still have to fill out a 5329.
In other words – I don’t need to deal with Fidelity at all! I can just take the withdrawals myself! I called them to ask why I needed them at all. They agreed that I really don’t. The only advantage is that (1) filling out the form shows that you really intend to do a SEPP, and (2) they make the distributions automatically on schedule.
But otherwise, Fidelity is worse than worthless – they have the ability to help but they perversely refuse. I know there can be legal liability issues they’re afraid of, but those are easy enough to forestall.
I’m not taking my money (I oversee some family money as well, so in total we’re not shabby) out of Fidelity because (1) otherwise over 18 years they’ve been trouble-free, and (2) I know from experience as a financial planner that Vanguard, Schwab and TIAA-CREF are no better, and on some things are even worse.2014-01-13 17:09, By: ejb, IP: [18.104.22.168]
L6: amortization calculations – Fidelity is a nightmareI agreed with everything that you said, until I got to the last line. There have been very few postings about problems with Vanguard or most other fund families, but most brokers are clueless also.2014-01-13 17:51, By: dlzallestaxes, IP: [22.214.171.124]
L7: amortization calculations – Fidelity is a nightmareMy SEPP ended last Oct. I used Fidelity for those 5 years and continue to do so with my investments. I had no problems with them. Again, as I said before, make sure the person at Fidelity knows about SEPP’s.2014-01-13 18:05, By: Chris, IP: [126.96.36.199]
L8: amortization calculations – Fidelity is a nightmareI just beganmy 72T with Fidelity this month. I have a Fidelity representative assigned to me, because of my account balance. Her recommendation was to consult with a tax advisor for 72T questions as Fidelity will not provided tax related advice. I would have gone that route if I wanted to perform my own calculation in order to get something inwriting from an expert.
However, once I learned that Ihad option to let Fidelity do the calculation for me, I decide to go that route.There were just a few selectionson the formto make. Iselected the amortization formula and single life to get the highestpossible amount.
I was just notified today on mymonthly withdrawal amount. Itended up being about 1% less than the online calcuators showed for me. I have no idea how they arrive at that figure. Perhaps there calculation is more precise or theydo some rounding. However, I’m satisfied with the amount, since if I am ever audited, I expect Fidelity will stand behind their calculation. Overall, I’ve been very satisfied with Fidelity service and with th 72T in place, I plan to stay there for at least another 5 years or more.
2014-01-14 23:25, By: Jack, IP: [188.8.131.52]
L9: amortization calculations – Fidelity is a nightmareIt has come up alot lately that Fidelity calculators generate a marginally lower SEPP calculation and that the explanation is that Fidelity assumes a first month distribution while other firms including this site use an end of year distribution which generates aslightly higherinterest amount than Fidelity.
It is also assumed that the IRS will not bust a plan for this difference, but if they did Fidelity could not do anything about it. The plan is between the taxpayer and the IRS.
Another issue is the recommendation to refer to your tax advisor. With a fairly thorough amount of research into72t planissues available on this site, the average intelligent taxpayer will know more about 72t plans than 95% of the tax advisors out there. Therefore,the benefitof this recommendation is questionable,but it serves to pass the burden of accurate adviceon to someone else.Further. IRS personnel are no more up to speed than tax advisors.Fortuneately, they bust only a fraction of the plans they probably could,part of the reason for that being that they realize that many ofthe detailsregarding these plans are not summarized in any single source or document.The most detailed document is RR 2002-62 and there are many issues that are not included in that RR. IRSletter rulings are not always consistent,thereforethis site is of major value since it is a centralized placefor interested taxpayers to report various IRS actions such as when they have busted a plan and for what reason.2014-01-15 01:05, By: Alan S, IP: [184.108.40.206]