S.E.P.P’s & life expectancy options
If you take S.E.P.P’s from an IRA with multiple non-spouse designated beneficiaries, can you still use your [u]single[/u] life expectancy to calculate the payments under each of the three S.E.P.P. methods? Thanks.
If you take S.E.P.P’s from an IRA with multiple non-spouse designated beneficiaries, can you still use your [u]single[/u] life expectancy to calculate the payments under each of the three S.E.P.P. methods? Thanks.
Permalink Submitted by Alan Spross on Tue, 2012-11-20 20:49
Yes. The beneficiaries only matter when the RMD method is used with joint life expectancies.
It is always better to use single life expectancy if you want the plan to produce a higher payout per dollar of account balance, particularly with the record low 120% mid term rate. If you don’t need to use the entire balance of an IRA, partition it into two accounts by direct transfer, with one of the accounts having the balance you need to produce the 72t payout you need. The other IRA account can be used for emergency needs or to fund an additional 72t plan later on if needed.