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SEPP

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Last Updated On
ByTracy

L1: SEPPDOB 7/5/62
First year of SEPP tax year 2016
Beginning balance of IRA $250,000
1099R for 2016 $53,000
I was told by my financial advisor that I had to use the $53,000 as my SEPP amount for my 2016 return and that I had to witjdraw that exact amount each year until age 59 1/2, with the ability to change methods once.
Is this accurate? It doesn’t seem to be from my research. Please help!
2017-10-14 19:48, By: Misinformed?, IP: [73.125.70.193]

L2: SEPPWhat was the date of the 1st distribution? What interest rate was used in the calculations?
I think you need a new financial advisor. Did you receive the instructions in writing? If yes, then maybe you will be able to get the advisor to pay the penalties and taxes that you will most likely encounter. Based on your date of birth and a starting age in 2016 and a current interest rate, the annual distribution would probably have been less than $10,0002017-10-14 21:16, By: Gfw, IP: [216.80.120.234]

L3: SEPPThat’s what I thought. I came up with $12K and change with my calculation.
Thank you.2017-10-14 21:19, By: Misinformed?, IP: [73.125.70.193]

L4: SEPPPlease understand, you don’t have a SEPP plan… if you took $53,000 distribution in 2016, you really have a premature distribution on which you owe penalties and taxes.2017-10-14 21:31, By: Gfw, IP: [216.80.120.234]

L5: SEPPI realize that, just clutching at straws trying to reduce my tax liability.
Thanks2017-10-14 21:57, By: Misinformed, IP: [73.125.70.193]

L6: SEPPDid you take the $ 53,000 on your own, or on the advice of your financial advisor ? If the advisor, demand that HE or his firm pay the penalties and interest. If HE refuses, go to the head of the firm.
Either way, you will owe the federal (and state, if applicable) income taxes, PLUS 10% “Early Distribution Penalty”. See if you qualify for any of the other exceptions to the penalty.2017-10-15 00:11, By: dlzallestaxes, IP: [173.75.252.16]

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