ought to be a better way

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L1: ought to be a better way
It would be nice if IRA custodians had some way of flagging an account with 72t restrictions, so customer could be warned before they make an illegal transaction that would bust the acct.
2018-03-28 20:19, By: angola, IP: [71.238.121.228]

L2: ought to be a better way
They have no way of knowing if you have other IRAs, either included in the SEPP 72-T, or not. You knew the rules, and you could have asked someone before doing anything different after setting it up.
I don’t trust clients to remember to pay estimates, which why I won’t give all 4 to them, and mail them 2 weeks before each due date.
This is the same situations where people have multiple doctors or pharmacies. Or people don’t follow the diets, exercises, or physical therapy.
People have to always accept responsibility for their actions.
2018-03-28 21:19, By: dlzallestaxes, IP: [173.75.252.16]

L3: ought to be a better way
How old are you? Let’s see how magnificent your memory is when you are nearing 60 and struggling with medical problems and needing to try to access your money early because of financial difficulties out of your control. Companies know if you are under 59.5 and taking a distribution that might carry a penalty. They would be providing excellent customer service if they could figure out a way to warn people of problems. The rules are complex and confusing for the average person. I would never have busted my IRA by rolling 401K into it if I had remembered the rules. Shame on me for not contacting my accountant before I made the rollover. It’s not like I was trying to get one over on the IRS and exceed my withdrawal. I was just trying to simplify my life and reduce the numbers of accounts I had. Shame on me for being forgetful and stupid. Shame on you for having no compassion for people like me. Seems like a high price to pay for an innocent mistake. By the way, my financial advisor DOES feel bad about it even though I am not blaming him.
2018-03-28 22:32, By: angola, IP: [71.238.121.228]

L4: ought to be a better way
Sorry for your troubles, but you knew up front that an IRA is between you and the IRS… no other person or company is involved. If you didn’t know that you should have hired a professional or not got involved in a SEPP.
As was pointed out, companies know your age and the amount of funds that they manage. They have no idea what other accounts you may have and what distributions will result in penalties. That is why most companies issue a 1099 with a code that states a early distribution on the annual 1099, but by that time the distribution would have already occurred.
ought to be a better way… Mistakes can be expensive and you are finding out the hard/expensive way. This site has been operational for a lot of years (17+ years) and gives the same advice today as we did way back when… learn before you jump, make sure that you know what you are doing!
Fyi.. I am 71+ and have a few health problems and before I do much of anything, I try to make sure that I know what I am doing or I get professional help.

2018-03-28 22:58, By: Gfw, IP: [172.9.118.235]

L5: ought to be a better way
GFW– Again, I truly wish that I had not gone down this path. Believe me, I have learned a very expensive lesson. But, I would like to know, what profession are you in? Probably, something to do with taxes or finance. I was in health care, and not very savvy about all of this. I have been under a lot of stress over the last few years and it has affected my memory. What about people who are starting to have cognitive impairment? How in the hell are they supposed to stay on top of all this complex financial information? Do you just think, too bad, so sad for them? I have an accountant who is happy to give me advice on this stuff. Why didn’t I call her before I did the rollover? I have no flipp’n idea. But, thanks for your reminding me what I already knew.
2018-03-29 00:50, By: angola, IP: [71.238.121.228]

L6: ought to be a better way
I agree with you, Angola. Companies, like Vanguard, should provide a 72t managed service, for a fee, which fee would prevent most unauthorized transactions on SEPP-designated accouants.
2018-03-29 00:54, By: sm69, IP: [71.84.14.13]

L4: ought to be a better way
I agree with you, but unfortunately, everything in the financial world is difficult to understand — Taxes, Social Security, Medicare, Investing, Insurance (Life, Health, Long-Term Care, Disability, etc.) That is why there are people like those of us who give freely of our time to help give guidance to others. If you think SEPP 72-T plans are complex, try understanding the new Tax Law, and projecting 2018 tax liabilities and withholdings.
I am 79, had a heart attack and quadruple bypass on 4/15/1998 (only a tax professional could pick that date), and a spinal fusion in 2000. I developed necrotizing fastiitis in January 2009, and not only survived, but also did not have to have my leg amputated. In addition,I was one of the first successful open heart surgeries in Dec. 1947 !!!! I am still practicing (one day I might even make the team), and enjoying helping clients, neighbors, friends, and people in the community, while still servicing 50 clients.
I encourage my clients to call me before they do anything financial. If it is outside my area of expertise, I make sure they get professional advice. But usually I am that professional. I attend 80-100 hours a year for Continuing Professional Education, even though I am only required to get only 1/2 of those hours, so I can learn, and stay up to date in all of the areas mentioned above. For me, the tax return is the beginning of my services, not the end, and only, product.
From what I have seen over the years, GFW and Alan are similarly motivated.
2018-03-29 01:59, By: dlzallestaxes, IP: [173.75.252.16]