Distributions Before and After Age 59½

Q: My client has been taking substantially equal payments (under Internal Revenue Code Section 72(t)) for six years, and will be age 59½ in July. What are his options after he attains age 59½?

A: Since substantially equal payments must continue for the longer of five years, or age 59½, he can stop taking those distributions in the next tax year. A distribution should be taken for this tax year since he didn’t attain age 59½ before the year began.

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