72Q
Are the rules exactly the same for 72Q and 72T? If someone who just turned 59.5 a day ago and has been under a 72Q since 2008, can they now stop distributions now or do they have to finish out the equal payments through this calendar year. I read something about having to take out the same amount each year. I am trying to see if that rule does not apply to the year you turn 59.5 as long as you take out the payments required up until 59.5 and at least for 5 years.
Permalink Submitted by Alan - IRA critic on Wed, 2025-09-10 17:02
The rules for a 72t and 72q are the same.
The options for the age 59.5 year for a plan longer than a 5 year plan are many.
They include taking no distributions before the plan modification date, taking out a pro rated amount by the month, or taking out the full annual amount prior to the modification date. Any other amount distributed prior to the modification date would bust the plan.
Permalink Submitted by Anthony Capristo on Thu, 2025-09-11 08:39
If there is a separated IRA, that has not yet been touched and is not part of a current 72T or 72Q, are you able to take a distribution from that separate account before the 72T or 72Q from another segregated account has reached the 5 year and 59.5 age mark? Will that bypass the retroactive 10% on 72T or 72Q funds even if taken as an early pre 59.5 withdrawal subject to a 10% penalty. I am trying to make sure taking an early distribution from a sperate IRA will not cause a retroactive issue to the current compliant 72T. The funds have been segregated in order to due this, but am not familiar with the rules.
Permalink Submitted by Alan - IRA critic on Thu, 2025-09-11 10:19
A distribution from an account that is not part of the 72q plan and was not included in the initial plan balance to calculate the allowed 72q distribution will not affect the plan. As you indicated, a distribution from the other account prior to 59.5 will be subject to the 10% penalty.
Permalink Submitted by Anthony Capristo on Thu, 2025-09-11 15:40
Thank you!