Error Results in Overwithdrawal
L1: Error Results in OverwithdrawalI made a math error that resulted in an over withdrawal of $87 for this year. I am not sure what action to take. I am still within the 60 day window of the withdrawal that caused the problem, but not of all withdrawals for the year. Can I redeposit the last withdrawal and then withdraw the correct amount? Is the some other action I should take?2009-11-28 15:17, By: Sunny, IP: [184.108.40.206]
L2: Error Results in OverwithdrawalIf the next SEPP withdrawal is in December, 2009 the best betwould be to merely reduce the next withdrawal by the $87. Next best alternative would be to send back teh $87.2009-11-28 15:34, By: Gfw, IP: [220.127.116.11]
L3: Error Results in Overwithdrawal
I agree with Gfw on this and would follow his advice.
That said, the Substantially Equal Periodic Payment (SEPP) plan is based upon taking a series of withdrawals that are the same annual amount for the longer of 5 years or until age 59.5 is reached. Even if a math error is made, you should have other withdrawal amounts to compare with the current withdrawal amount. It is good to watch the amounts VERY carefully. You did catch this error in time to replace or compensate for the overage and that is good. Had you not noticed this error, it is likely that your SEPP would have been busted. Better yet is to know the amount that should be distributed and make sure that this known amount is distributed at the proper time. Most, if not all, custodians allow clients to set up a regular automatic withdrawal in the amount of and at the time that the client specifies. Doing this makes it easier to get and track the withdrawals. A good technique is to keep a printout of your account every time a distribution is made so you can check to see if the amount is the same as the last time. Keeping copies of the 12/31 annual statement is also good since that should show the amount distributed for the entire year.2009-11-28 19:16, By: Ed_B, IP: [18.104.22.168]