72T
Can you STOP one 72T that includes all the IRA Assets. Then Roll them over to new IRA(S). And only take one or two of the new IRAs and start the 72T over? Example $500k in one and the new ones each would have 100K in each of the new ones. So two of the new ones would have the 72T distribution while the othes just sit. Pay the penality on the prior distrubutions. The new distibutions would recieve no penality.
Permalink Submitted by Alan - IRA critic on Mon, 2015-03-30 17:50
You can voluntarily bust your current plan whenever you wish, but will owe the penalty plus late interest on distributions you took under that plan. The IRA can then be partitioned by direct trustee transfers into several IRA accounts before the new plan is started. Under the new plan, the total distributions from all these IRA accounts must equal the newly calculated 72t amount and the new plan must run for the longer of 5 years or age 59.5. Distributions can be taken from some of these IRAs and not from others. But do not need surprised if you get an inquiry from the IRS because they do not see many complex plan setups. You would be claiming your penalty waiver on more than one 1099R. Finally, having this many IRAs in your plan makes the risk of an error higher in addition to more IRS scrutiny. Very often, this multiple IRA setup is triggered by insurance agents selling IRA annuities. But doing these transfers between plans is safer than trying to do partial transfers in the middle of a plan.