72T Question
Hello, a client start a 72T plan on 09/22/20 with monthly payments for a fixed amount. The client now has decided that they no longer want the plan. While the 9/22 payment would be subject to the early distribution penalty is the client allowed to roll the funds back as a 60 day rollover? Any feedback would be greatly appreciated. Thank you.
Kevin
Permalink Submitted by Alan - IRA critic on Tue, 2020-10-13 16:17
Yes, the client simply can decide not to report the 72t plan and treat the distribution as subject to penalty, or if allowed a 60 day rollover per the 12 month limitation for only one such rollover, can roll the distribution taken back into the IRA. There is no other special IRS reporting since this does not involve any prior years.