72(t)
I am 55 years old and would like to start a 72t distribution from my IRA. Can I calculate the distribution on an annual mode but take monthly distributions and still be ok? Doesn’t the IRS just care if the same annual dollar amount comes out each year?
Thank you.
Permalink Submitted by Alan - IRA critic on Sat, 2019-02-02 00:27
Yes, the IRS only cares that the 1099R total match your documented plan calculation. The distribution pattern is not a factor and you can take your distributions randomly if you choose. I would avoid periodic distributions in the first or last 5 days of any month, because that creates major risks at year end that the Dec distribution does not get done in time, OR the January distribution comes out early because of New Years Day or weekends. Since you will have a 5 year plan, it is best to take a full annual total distribution this year and no distribution in 2024.