72T
If a person has been on the 72T program for 7 years with a monthly distribution of $1,451.27 and only has 12 months until the 72T program is finished and is having financial hardships, (foreclosure notice on their home) is there any IRS exceptions to not be penalized for busting the 72T program due to financial hardships?
Permalink Submitted by Alan - IRA critic on Tue, 2015-06-02 20:15
No, but the person is not required to continue monthly distributions as long as the annual total is correct. The 2015 balance could be distributed right now (7 months worth to bring the total to 12 months, then options for 2016 include a full annual payment in January. Upon reaching 59.5, the person is able to then take out as much as they wish without penalty. Probably not enough, but it might buy some time while saving the 72t plan.