Setting up a 72T

You are here:
< Back

L1: Setting up a 72THello: I am interested in setting up a 72T and will be meeting with someone to do so. However, I wanted to do some preparation before I do. According to this site I may use the rate of 2.83 for my calculations. But the AFR tables says that the rate for Sept 2010 is 2.33. My question is which rate may I use? Also, I read that I may be able to take a lump sum for the 2010 year and then begin taking monthly distributions beginning Jan 2011. Is this correct? Thanks to all for your advise.2010-09-01 15:27, By: rosa, IP: []
L2: Setting up a 72TIf your first SEPP Plan distribution occurs in September, 2010, then you may use either the July (2.83%)or August (2.62%)”120% Mid-term Rate” for your calculations. The September rate (2.33%) would be used for plans starting either in October or November, 2010.
On the left side of this page look at “Interest Rates” and “120% Mid-term Rate” for further discussion of this subject.
Jim2010-09-01 15:53, By: Jim, IP: []

L3: Setting up a 72TRe the other question you asked – Yes, after you correctly calculate your annual SEPP distribution, you can take out that entire amount in the first year of your plan, even if you start your plan as late as December. You can also take out a pro rated amount by the month of your initial distribution, but you CANNOT take out some amount in between the pro rated amount and the annual total.
For years after that, you must take out the correct annual amount, but you can change the frequency and amount of the distributions in any manner you wish as long as you have distributed the correct total by year end.
In your last (stub) year of the plan, you will have different options, but you don’t need to know them all at this time. 2010-09-01 21:55, By: Alan S., IP: []

L4: Setting up a 72TThank you all so very much for your assistance. I wish I had known about this forum months ago… But like they say, better late than never…2010-09-02 17:47, By: rosa, IP: []

L4: Setting up a 72THello: I have a question regarding the calculator. When using the calculator is the payout amount that the calculator shows an “estimate” or the actual amount that one should get when setting up their SEPP. If it is an estimate, for planning purposes, do you know what percentage amount should I be plugging in to my planning? For instance, should I be looking at +/- 1%, 2% etc. Thanks.2010-09-27 12:33, By: Rosa, IP: []

L5: Setting up a 72T
It is an EXACT annual amount. If you take monthly distributions, divide by 12 and round to the nearest cent. Then multiply by 12 and the result should be withing 50 cents of the annual. Do the same for any other mode. 2010-09-27 12:59, By: Gfw, IP: []

L6: Setting up a 72TBased upon the simple basic questions that you are asking, I suggest that you get professional advice before you get yourself into trouble. If you have time before you plan on starting, order the book available on thsi website, and read it at least twice before meeting with your advisor.2010-09-28 04:28, By: dlzallestaxes, IP: []