L1: SEPP CalculationsMy husband and I are planning to set up a SEPP at Vanguard in August so we can use the June interest. We know the amount we need and are going to use the lump sum from my pension and add some funds from my existing IRA to get it. We feel the calculations are pretty straight forward (my husband is a CPA) but would like a couple of clarifications if anyone knows the answers.
Anyone know if the functions in Excel are reliable?We got the same numbers as in the IRS example on their website and in the calculators on line here but there is always that question. Is our calculation correct??
Also, we used the single mortality table. Is there any benefit in using the joint?
We have done a lot of research and feel pretty confident in what we are doing but it would have been nice if VG could have at least looked over the numbers for us.
Any insights anyone has would be appreciated.
Thanks!2010-07-27 22:25, By: Corporate Orphan, IP: [22.214.171.124]
L2: SEPP CalculationsIf your Excel spreadsheet matched the IRS examples and our calculators, then you should be Ok. Just make sure that you keep gooddocumentation as the plan operates. If youstart with the right interest rate and age and know your calculations, then youonly have to worry about the operation of the plan.Don’t bother with the joint table, it will only produce lower distributions amounts.If you haven’t already, please check out ourPlanning Pointers2010-07-27 22:39, By: Gfw, IP: [126.96.36.199]
L3: SEPP CalculationsMost mutual funds and brokers are reluctant to take the responsiblity for the calculations. The IRS places that responsibility on you, the same way you are responsible for the info on your 1040 tax return, even if it is prepared by the best tax preparer. Similarly, most of them will not code the1099-R with anything other than a 1, and make you file a 5329 to take responsibility for the esxclusion.While it’s hard to understand why, it is easy to understand why — LIABILITY.2010-07-28 05:26, By: dlzallestaxes, IP: [188.8.131.52]
L2: SEPP CalculationsI think you have received good advice and guidance to set up your SEPP PLan and, from your comments, you seem to have a pretty good handle on the process. The suggestion I will make is directed to your CPA-husband.You can learn all you need to know about setting up and running SEPP Plans from the information available on this site and by asking questions onthis forum. The biggest problem for people who seek help from their CPAis that their CPA doesn’t really understand how to properly set up and run a good, compliant SEPP Plan. So my suggestion for you is to become a highly qualified SEPP Plan CPA. Youwill have a new income source that right now you have no idea how big the demand is for qualified SEPP Plan CPA’s. Buy Bill Stecker’s book, available on this site, for your reference manual. I don’t know for sure but I think I have only counted 3 or 4 SEPP Plan CPA’s who post here with any regularity. But from the number of different posters telling us their CPA doesn’t understand SEPP, I must conclude that the population of qualified, SEPP Plan CPA’s is pretty small.One last point. SEPP Plans, aka 72(t), is a “tax issue” and as such, generally only CPA’s and tax attorneys are covered by their E&O insurance. That’s why financial planners won’t “go on record” for SEPP Plan calculations.Jim2010-07-28 14:50, By: Jim, IP: [184.108.40.206]
L3: SEPP CalculationsThanks for all the feedback! 2010-07-29 21:13, By: Corporate Orphan, IP: [220.127.116.11]