Setting up new IRA mid-year
L1: Setting up new IRA mid-yearHi,
Great site! I am planning on setting up a 72t currently by splitting a current IRA into two and designating one to be the 72t IRA. Once the IRA is set up, is the starting amount in the designated 72t IRA the amount I use to calculate the SEPP? Usually it says to use the year-end amount, but in this case, I want to start taking withdrawals before the years end. Thanks2009-09-16 17:45, By: Ron, IP: [220.127.116.11]
L2: Setting up new IRA mid-yearOnce you do the split, use teh balance after the split. If you can get an online statement, that will work or wait for a snail-mail statement. Either way, merely keep good documentation as to the two IRAs and your initial calculations.2009-09-16 17:48, By: Gfw, IP: [18.104.22.168]
L3: Setting up new IRA mid-yearPresumably, you are doing the split to create an IRA account with the balance needed to provide you with the distribution you need. This is a good idea if you have more funds than you need.
While you can go back up to 6 months for an account balance that is reasonable in relation to the current value, that option is eliminated when you split an IRA. That’s because either adding funds or moving funds out of the IRA is not allowed in the period between your account balance date and the date of your first SEPP distribution. Therefore, when you split the account, that action replaces the option of using an older balance since both IRA accounts are altered by doing the split.2009-09-16 21:23, By: Alan S., IP: [22.214.171.124]
L4: Setting up new IRA mid-yearTo expand on Alan’s comments, you might want to wait a month or 2 after splitting into 2 or more IRAs. This will give you at least 1 clean month-end valuation statement, and also allow “trailing dividends” to be posted to the separate account it applies to.2009-09-17 03:17, By: dlzallestaxes, IP: [126.96.36.199]