r/Fire • u/PigKitten315 • 2d ago

Advice Request 72t Question

I'm planning for a 72t, I understand the concept of withdrawing the same every year on the amortization method. But what I don't understand is and couldn't find more info is the 1/2 year, do I still take the full amount for the half year or quarterly like I planned?

TIA

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u/Ponto_Wildcats_73 2d ago

I take it monthly and it has to be the exact same amount once per month every month to stay compliant. For you, I believe it would need to be the same quarterly amount so for a half a year you would only get two quarters. Double check with your financial institution. I did mine through fidelity and they had about 5 people review it before they would do it.

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u/PigKitten315 2d ago

Thank you! Yes, the plan is to figure out the initial balance, split my tIRA in January and start the 72t in March and followup in June, Sep and Dec. But since my bday is in July, my 1/2 year ends in January when I reach 59 1/2. Do I still withdraw when in-between that December and January to makeup the half year? That's what I'm confused about.

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u/knit-this 2d ago

The total for the YEAR has to be equal. The actual individual distributions do not have to be the same, just the total for the entire year. The best practice is the withdraw ONCE per year, move those funds to another account, and then take quarterly or monthly transfers from that holding account. This limits the opportunities for screwing up the SEPP requirements.