A:

You may discontinue the payments. Once the person who is taking the substantially equal periodic payment (SEPP) dies or becomes disabled, the SEPP can be discontinued. For this purpose, disability must satisfy the definition under Internal Revenue Code § 72(m)(7).



To learn more, read Rules Regarding Substantially Equal Periodic Payments and How do IRA SEPPs work?



This question was answered by Denise Appleby
(Contact Denise)



RELATED FAQS
  1. I stopped distributions from my retirement account while under Rule 72(t). Will this ...

    If an individual modifies a substantially equal periodic payment (SEPP), including discontinuing the SEPP before the end ... Read Answer >>
  2. Will I incur a tax penalty when making withdrawls from my IRA in excess of my SEPP?

    Unfortunately, the IRA is "locked" for five years because of the requirement that the substantially equal periodic payment ... Read Answer >>
  3. What are the "certain requirements" that must be met for substantially equal periodic ...

    For substantially equal periodic payments (SEPPs), the distributions would occur from your IRA after you rollover the assets. ... Read Answer >>
  4. I am in the second year of taking SEPP distributions from my IRA. Can I transfer ...

    The most recent guidance issued by the IRS and the Treasury Department is Revenue Ruling 2002-62. There is some disagreement ... Read Answer >>
  5. Once substantially equal periodic payments (SEPP) of an IRA have started, is the ...

    Typically, if you withdraw assets from an IRA or a qualified retirement plan sponsored by your employer while under the age ... Read Answer >>
  6. I have some stocks in a taxable account. Can I use them to fund my Roth IRA instead ...

    Regular IRA contributions must be made in cash. Contributions of securities are not allowed. Internal Revenue Code Section ... Read Answer >>
Related Articles
  1. Home & Auto

    Intro To Insurance: Disability Insurance

    By Cathy ParetoAside from health insurance, disability is a very critical type of insurance individuals should consider having. When it comes to your personal finances, long-term disability can ...
  2. Investing

    Advising FAs: Explaining Disability Insurance to a Client

    Disability is a very critical type of insurance that most individuals should consider carrying. When it comes to your personal finances, long-term disability can have a devastating effect if ...
  3. Professionals

    Benefit Periods

    Benefit Periods
  4. Professionals

    Disability

    Disability
  5. Retirement

    Tapping Retirement Funds Early – Without A Penalty

    The IRS offers several ways to skirt the 10% penalty on early retirement distributions.
  6. Insurance

    Do You Qualify for Social Security Disability?

    When it comes to qualifying for Social Security Disability Insurance, you either do or you don’t. Here's how to find out if you do and how to apply.
  7. Professionals

    Disability Insurance

    Disability Insurance
  8. Options & Futures

    The Disability Insurance Policy: Now In English

    Learn to translate this complicated policy so you can rest assured you're covered.
  9. Professionals

    Disability

    Disability
  10. Insurance

    Tips for Insuring Your Salary

    Those with high incomes really can’t afford to be without disability insurance. Here's why.
RELATED TERMS
  1. Substantially Equal Periodic Payment - SEPP

    A plan that allows individuals who have invested in an IRA or ...
  2. Rule 72(t)

    An Internal Revenue Service (IRS) rule that allows for penalty-free ...
  3. Discontinued Operations

    A segment of a company's business that has been sold, disposed ...
  4. Any-Occupation Policy

    A term used in the insurance industry to refer to a specific ...
  5. Payment Protection Plan

    An optional service that lets a disabled or unemployed consumer ...
  6. Premature Distribution

    Any distribution taken from an IRA, qualified plan or tax-deferred ...

You May Also Like

Trading Center