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09-09-2015, 07:25 AM
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#1
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Recycles dryer sheets
Join Date: Jan 2008
Posts: 126
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72t question
If I use a 72t on my rollover IRA at Fidelity, will I be able to direct the withdrawals to come only from the cash or fixed income portion of the account or will they want to draw it down equally across all investment options?
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09-09-2015, 07:45 AM
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#2
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,323
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I can't imagine that you would not be able to direct the withdrawals from specific holdings within the IRA.
I have only seen those types of limitations within employee sponsored (e.g. 401k) plans. If necessary, I believe you could isolate funds in a separate IRA for the 72t. It's a good idea to use fixed income so your opportunity cost is also fixed.
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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09-09-2015, 07:47 AM
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#3
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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 Quote:
Originally Posted by Gazingus
If I use a 72t on my rollover IRA at Fidelity, will I be able to direct the withdrawals to come only from the cash or fixed income portion of the account or will they want to draw it down equally across all investment options?
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The thing that matters is that you take out the correct amounts and make the IRS aware of that. You will be making the withdrawals so you can take the money from any portion of the account you like.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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09-09-2015, 09:38 AM
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#4
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Recycles dryer sheets
Join Date: Apr 2012
Location: Seattle
Posts: 479
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Quote:
Originally Posted by Gazingus
If I use a 72t on my rollover IRA at Fidelity, will I be able to direct the withdrawals to come only from the cash or fixed income portion of the account or will they want to draw it down equally across all investment options?
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You may have this already but I refer to this 72t website. Lots of good stuff. Cheers.
About 72t on the Net
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09-09-2015, 10:38 AM
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#5
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Thinks s/he gets paid by the post
Join Date: Oct 2002
Location: Chattanooga
Posts: 3,892
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You can specify which account within the IRA you choose to draw from. I did a 72T and took from the MM settlement account within the IRA. As other have pointed out, do your homework and make sure you know the rules as the IRS may coming calling. Also if you do the 72T you will get a 1099R with a code 1 and you will have to complete a 5329 form to note the 72T exception.
__________________
Earning money is an action, saving money is a behavior, growing money takes a well diversified portfolio and the discipline to ignore market swings.
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09-09-2015, 03:33 PM
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#6
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Full time employment: Posting here.
Join Date: Jan 2006
Posts: 956
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I agree with others!
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09-09-2015, 11:19 PM
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#7
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Thinks s/he gets paid by the post
Join Date: Jul 2005
Location: Los Angeles area
Posts: 1,708
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I have been taking 72t withdrawals for 9 years now from my Schwab IRAs. As I make each transfer, all I tell Schwab is code 2 (no penalty) vs code 1 (penalty). It is my responsibility to keep spreadsheets to make sure I take out exactly the right amount each year - very important as a mistake can break the whole series of withdrawals for that IRA.
__________________
learn, work, save, invest, fire
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