In this session, Larry Pon, CPA teaches how to take advantage of the various exceptions to the early distribution penalty from IRAs and retirement accounts. These exceptions may be triggered by any one of several scenarios, including: a spouse's death, total and permanent disability of the participant/IRA owner, extraordinary large medical expenses and more.
Larry also reviewed how to request a waiver for missed or incorrect required minimum distributions (RMDs), preparing the Form 5239 for multiple years for excess contributions to qualified plans, and requesting abatement of penalties for early distributions from IRAs and retirement plans. The penalty for a missed or incorrect RMD is among the highest in the tax code at 50%. Excess contributions are subject to a six percent excise tax that continues annually until the overfunded amount is withdrawn. Note that some of these exceptions only apply to IRAs and not employer retirement plans.
As a layman, I learned a lot about how careful you have to be with RMDs.
Didn't recall the different methods for the 72(t) distribution calculations.
Good refresher. I had forgotten about the IRA to HSA.
I had NO idea about the 5.00% rate that has been instituted for 72(t). Really wish I had known about this last year.
I was reassured that 401k has greater asset protection than an IRA. Learned about the funding an HSA from an IRA in certain circumstances.
Not totally new but great reminder about HSA rollover possibility - I am 64 this year and may forego HSA contribution to do that instead.
Periodic payments and to may sure what type of plan when getting distributions due to death
RMD rescue advice
The 2 year gap between being first time home owner. that house exception can be used for children/grandchildren. reminder about age 55 rule. Using IRA for HSA funding (too bad only one time). HAVE TO REPAY ROLLOVER IN ONE LUMP SUM
The funding HSA from a IRA distribution was new to me. Would like to know more about this strategy. I.e. when it makes sense, when it doesn't.