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72(t) & 72(q) SEPP Calculator

The calculators default values are set to values that would be acceptable under Revenue Ruling 2002-62. However, be sure to verify the interest rate using the link in the menu on the left. Also remember that there is more to a SEPP plan than calculating the annual distribution. Check out our Planning Pointers for pointers on establishing your SEPP plan.

SEPP Calculators
Maximum Interest Rates for 72(t) & 72(q) SEPP Plans
The maximum interest rates where the initial plan distribution occurs during the following time periods are: 02/01/2012-02/29/2012: 1.53% | 03/01/2012-03/31/2012: 1.40% | 04/01/2012-04/30/2012: 1.34%
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Owner's Age: Age is attained age on 12/31 of the year that distributions will begin or for the Minimum Distribution method, the attained age on 12/31 of the year the distribution is made.

Beneficiary's Age: Enter your attained age of the account beneficiary in the year that distributions will begin.

Method to Illustrate: Select from one of the three acceptable methods.

Total IRA Account Balance: Enter the total balance all of your IRA account(s). Used only for illustrative purposes.

Amount Allocated to SEPP: Enter the amount in the IRA account(s) that will be used in the SEPP plan. When you decide what IRA account to allocate to the SEPP plan, then all the funds in those accounts must be used to determine the annual distribution from the SEPP.

Reasonable Interest Rate: Enter an interest rate that will be reasonable when the first payment is made for methods number two and three. Post 12/31/2002 - For any SEPP plan the interest rate that may be used is any interest rate that is not more than 120 percent of the federal mid-term rate for either of the two months immediately preceding the month in which the distribution begins.

IRS Penalty Interest Rate: The interest rate charged by the IRS on past due income taxes and tax penalties. Used only for illustrative purposes.

Use Joint Calculations: Enter either YES or NO to use joint life expectancy calculations. To use the Uniform Table merely set the beneficiary's age to the Owner's age minus 10. Joint calculations are seldom useful as they will always generate a lower annual distribution.  If this entry is selected, the next entry may not be selected.

Use Uniform Table: Enter either YES or NO to use the Uniform Table for the calculations. Using this entry will automatically base the calculations on a beneficiary age 10 years less than the owner's age. Joint calculations are seldom useful as they will always generate a lower annual distribution. If this entry is selected, the previous entry may not be selected.

COST to BUST: The Cost to Bust is equal to the the penalty due for the current year, all previous plan years, plus interest due. 

For example, Based on a payment of $9,001.71 and an IRS Interest Rate  of 9%, Year 2 would be calculated as follows:

Year1=(9001.71*.10)+(900.17*0.09)= 900.17+81.02
Year 2=(9001.71*.10)              = 900.17
Total Tax & Penalty Due:          =1881.36


Planning Pointer: If the single life calculations produce a higher than desired payment, consider breaking the single account into multiple accounts using only one of the accounts to produce the desired SEPP payment.

Other accounts can be used for emergencies or for establishing another SEPP at a later date.

Click the [Help] button again to collapse this window

Age is attained age on 12/31 of the year that distributions will begin or for the Minimum Distribution method, the attained age on 12/31 of the year the distribution is made.
Owner's Age 
Beneficiary's Age 
Method To Illustrate 
Total IRA Account Balance    
Amount Allocated to SEPP Plan    
Reasonable Interest Rate - The maximum interest rate that may be used for a SEPP plan is any interest rate that is not more than 120 percent of the federal mid-term rate for either of the two months immediately preceding the month in which the distribution begins
Reasonable Interest Rate    
Actual Investment Rate    
IRS Penalty Interest Rate    
Use Joint Calculations 
Use Uniform Table 
Report to View:
 


72t/72q/SEPP Links