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Timing of Distribution

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ByKathy

L1: Timing of DistributionI have a client who has been taking a monthly 72(t) distribution since September 1999. He will turn 59 1/2 in May of 2006. He would like to stop his 72(t) distributions as soon as he can. If his annual distriubtion amount is $24,000 and he is taking $2,000 per month, how much does he have to take in 2006? Can he only take $10,000 this year and stop in May? Or does he have to take the full $24,000? 2006-02-13 11:32, By: Kathy, IP: [70.60.29.10]
L2: Timing of DistributionThis question comes up frequently and Bill Stecker had a great post a while back, I just can”t find it and maybe he will post it again.
Assuming that the 5-year rule has been met and doesn”t need to be consiered, if your client”s 59.5birthday falls in 2006, he can take any distribution that is part of the SEPP or take no distribution in2006since the 59.5 rule will have been met.2006-02-13 11:58, By: Gfw, IP: [172.16.1.75]

L2: Timing of DistributionHello Kathy:
Your client actually has three choices for 2006; more specifically for the period 1/1/06 to 5/31/06:
1. Distribute zero.
2. Distribute $10,000.
3. Distribute $24,000.
TheBadger
wjstecker@wispertel.net
2006-02-13 18:41, By: TheBadger, IP: [66.250.23.25]

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