first modification date

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L1: first modification dateHello. I calculated my first modification date. I will have taken 6 distributions by that time because I took the firstone Oct. 2009, then Jan 2010, and plan one every Jan thereafter till the modification date of Oct 1, 2014. I will have obtained 59 1/2 in Jan 2014. Does all this sound ok?2010-07-03 18:18, By: TheresaM, IP: []
L2: first modification datePerhaps OK. But you did not indicate the date of your first SEPP distribution last October. Even if the distribution was dated 10/1/2009, it is recommended that you add a couple days to the 5 year period for a safety margin. If your first distribution was later in October, then you modification date would also be later in October, 2014.A different issue is your options for distributions in your final stub year of 2014. All the modification date means is that distributions prior to that date must comply with SEPP requirements, while after that date your plan has ended and there are no restrictions. So you also will need to decide in 2014 how much you will withdraw PRIOR to the modification date. Your choices will be:1) A full annual distribution2) 3/4 of an annual reflecting September asthe month for which you must take adistribution3) Take nothing, BUT ONLY if you took out 12 months worth in 2009, and would therefore have taken out 5 years of distributions by year end 2013. Finally, it is somewhat risky to take out your full annual in January because it puts alot of budget pressure on you. If you spend too much too fast and run dry prior to year end, you risk having to take a plan busting extra distribution. Besides, in today’s environment you are not going to earn much in the way of interest for the period between your distribution and spending that distribution. 4 quarterly distributions in the first week of each quarter is better, but as long as you know the risks and deal with it you should be OK.2010-07-03 22:54, By: Alan S., IP: []

L3: first modification dateI took my first dist on Oct 1, 2009 ( full years worth). So if I am understanding right, I can take arequired dist. on Jan 1, 2014, and let’s say, Oct 15 ( allowing a few extra days) I can take out whatever I want. Is that correct thinking? I’m going to have to take out money to be able to live in Jan 2014, so It must be in that exact amount, and be a 6th full dist. , because my modification date is not till Oct that year. Correct?As far as my withdrawing a full years worth in Jan. each year. I carefully budget, but we all know that emergencies do happen. I have a cashemergency fund in an after tax account for that purpose. Is that ok?Thanks for your help.2010-07-05 02:13, By: TheresaM, IP: []

L4: first modification dateYes, after 10/03/2014 you can take out whatever amount you wish, since you will have passed the modification date.Prior to the mod date in 2014, you have 3 choices asindicated above. The largest of those options is simply taking out the full annual amount in January or anytime prior to the mod date. The fact that a full annual would be your 6th does not matter.And certainly having the emergency fund is a good idea.2010-07-05 04:36, By: Alan S., IP: []