Breaking and Restarting a 72T

L1: Breaking and Restarting a 72THello Everyone,
A client of mine started a 72(t) SEPP in February of 09. The client just turned 58. They need to take $50,000 out of their IRA account immediately and this is much higher than the maximum amount they can take based on their 72(t) calculation. So in effect, if the client takes out the money they will break their 72(t).
If someone breaks 72(t) are they allowed to restart it after? Assuming they can, are they allowed to start their 72T in the same year they break it? Assuming the client CAN break and restart their 72T in the same year, do they use the 12/31 value of the previous year to calculate how much they can take out? (In effect using the same value they used with the previous 72(t))
I appreciate any assistance and insights.2009-07-14 18:17, By: TeeTime, IP: [199.43.32.81]

L2: Breaking and Restarting a 72TI’m sure that there must be a reason to start a SEPP plan at age 58, but it shouldalmost always be a last option to borrowing, etc.
Can they break and re-start? Sure They will merely pay penalties and taxes on the amounts taken prior to starting the 2nd plan.
Can they use the previous 12/31 balance? No way. What they could use is the balance sometime prior to the start of the new SEPP and after the last withdrawal before the new SEPP is started.2009-07-14 18:25, By: Gfw, IP: [216.80.125.206]

L3: Breaking and Restarting a 72TIf you would like guidance, please give us the reason(s) that they NEED $ 50,000 immediately. There may be better alternatives, especially if they can limp thru until 59 1/2, rather than tieing up their retirement funds for 5 years ( 3 1/2 years longer than necessary). Unless they can guarantee you that they won’t bust the plan over the next years ( even 60 months from now), they should take what they need, and pay the 10% penalty on just what they needuntil 59 1/2.
There are several exceptions to the 10% penalty that they may qualify under.2009-07-14 19:43, By: dlzallestaxes, IP: [72.78.231.205]