reasonable cost for assistance setting up 72t
L1: reasonable cost for assistance setting up 72t
Hi – I am setting up a new plan DOB 9/1/61 not sure on Date of Distribution. Probably Mid year. Need about 35k pre tax per year. 900,000 in assets at vanguard. I am nervous about setting everything up on my own (despite all of the good advice and guidance here) None of the CPA’s I know (and several others that I’ve been referred to) are not knowledgeable about setting these up. I found a resource on the web “Professor 72t” who charges a flat 1500.00 to handle the whole thing. Seems like alot of money to me? Has anyone else found a good resource or paid someone else to help? Can you share your experience/cost? Thanks you
2018-01-23 22:16, By: chelsea, IP: [22.214.171.124]
L2: reasonable cost for assistance setting up 72t
Yes, 1500 is ridiculous. There are probably not many viewers here who don’t start their own plans, but perhaps someone will chime in and address your question. As you probably have figured out, when you are looking for assistance you are likely to run into many tax people or advisors who know less about this than you already know.
Perhaps this will help somewhat. Your IRA balance will produce an annual distribution of just under 47,000 using the latest interest rate. Did you mean that you want a gross distribution of 35k before withholding or the 35k is what you need after withholding for your expenses? If the former, you should partition the IRA by direct transfer into two accounts at Vanguard, the first for around 675,000 to use for the SEPP, and the other non SEPP account for the balance to use for emergency needs. The good news is that your balance is plenty high to produce the amount you want and allows you to split the accounts in order to have a second one outside the plan in case something happens and you need to take out more.
If you want to use the simplest approach, you would distribute the calculated full annual amount in say June, 2018, then do the same in 2019-2022. Your plan is a 5 year plan, meaning it ends in June, 2023 and you would not take a distribution in 2023 until after the plan ended if you need a distribution.
You can change the withholding anytime you want. The only thing that matters is your gross distribution. There are other things you can do such as changing your payment pattern to quarterly or monthly, but if you want to keep things as safe as possible I would just take out the one distribution.
Did you read the planning pointers on this site?
2018-01-23 23:51, By: Alan S, IP: [126.96.36.199]
L3: reasonable cost for assistance setting up 72t
You are almost 56 1/2. Isn’t there any way that you can find the $105,000 that you say you will need over the next 36 months, i.e. $ 3,000/month ?
If you set up a SEPP, you will be locked in for 5 years (60 months).
I would suggest looking at selling non-retirement investments over the next 3 years, or a home equity loan or line of credit (non-deductible interest) or refinancing of a mortgage (deductible interest).
2018-01-24 06:11, By: dlzallestaxes, IP: [188.8.131.52]