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L1: coolbeans
This is a new post. I am 56 years old 06/31/1962. I rolled out my 401(k) to an IRA. The 72 (t) calculator says I can take $39,000 starting 11/15/2018. The problem is i need $75,000 a year in income. Can I take the $75,000 or do I take the $39,000 from the IRA 1 with the 72(t) and establish a second IRA to take the difference for the 5 years and pay the penalty on $36,000? 75-39=36
2018-10-16 22:37, By: Beans , IP: [2601:283:4402:7c44:60fa:de1e:37f5:85a9]

L2: coolbeans
You can only withdraw 39,000 per calendar year, but since you can take out 39,000 this year, by the end of 2019 you will have 78,000 distributed, and that should reduce the penalized amount you will have to withdraw from your non SEPP IRA account before 2020. Of course, the balance you establish in the non SEPP account before the initial account balance is determined for your SEPP will reduce the allowed SEPP distribution amount. However, since the SEPP distribution will be around 5% of your opening balance, your SEPP distribution is only reduced by $5 for every $100 transferred to the non SEPP account from which you can withdraw any amount you wish. Care must be taken when partitioning your IRAs into the ideal amounts for the SEPP and non SEPP accounts.
While you will have a 5 year plan (39,000 in 2018, 19,20,21 and 2022). Now I know you were not born on 6/31 because there is no such date. However, if you were born on 6/30 then you will reach 59.5 on 12/30/2021. If you can postpone your non SEPP distribution for 2021 until that date or later, there will be no penalty on your non SEPP distribution. You can also be alert to see if you have a penalty exception such as high medical costs or any of non SEPP penalty exceptions in any year before 59.5 because it will give you a chance to take penalty free distributions from the non SEPP account anytime in that year.
2018-10-17 03:39, By: Alan S, IP: []

L2: coolbeans
If you separated from service during 2018, and if your former company allowed partial distributions whenever you wanted them, then you should not have rolled over your 401-k into an IRA. Then you could have done whatever you wanted, whenever you wanted. And there would have been no 10% penalty for early distributions.
Also you would not have been locked in for 5 years until 11/15/2023.
Maybe your ex-employer will allow you to roll your IRA back into your old 401-K plan.
If you tell the amount now in your IRA, maybe we can figure something out for you.
If you tell us what you “need” the money for, there may be other exceptions that will avoid the 10% penalty.
2018-10-17 05:02, By: dlzallestaxes, IP: []