This is a follow-up to my original post regarding the RMD Holiday for 2009.
If you’re taking a Series of Substantially Equal Periodic Payments (SOSEPP), also known as 72t payments, from an IRA or other plan, you are not allowed to “skip” a payment for 2009. The reasoning behind this is that your 72t payments are not Required Minimum Distributions (RMD), even though you may be using the RMD calculations to determine the amount of the distribution, and also even though, once begun the distributions are required to continue.
Now, in a different scenario, if you have inherited an IRA and are taking it out over either your life span (or an alternate life span) or the default five-year period, you are allowed to skip your distribution for 2009. These payments, along with your garden-variety, over age 70½ distributions, are considered to be Required Minimum Distributions, and are specifically exempted for 2009 via the Worker, Retiree, and Employer Recovery Act of 2008.
Photo by Pink Sherbet Photography
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I can learn from you, you can learn from me - please leave your comments and links!Jim Blankenship, CFP®, EA, is an expert in personal retirement, IRAs, and tax issues, with more than 25 years of experience in the industry. Read more from this author
And if you've come here to learn about queuing waterfowl, I apologize for the confusion. You may want to discuss your question with Lester, my loyal watchduck and self-proclaimed "advisor's advisor".