Splitting IRA for 72(t) Purposes

Can a rollover IRA still be split into two smaller IRA’s and then a 72(t) be established on only one account?

Someone told me this is no longer allowed.

Thank you,
Harold



They were incorrect. This is not only allowed, but often recommended in order to have a source for emergency distributions without busting the 72t plan. Of course, the distribution from the IRA that is NOT included in the 72t plan will be subject to penalty, but this allows the 72t plan to survive. It is also possible that the emergency distribution could have it’s own penalty exception (high medical costs, health insurance while unemployed, higher education etc).



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