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Subject:  Re: Substantially equal periodic payouts Date:  3/13/1999  9:48 AM
Author:  TMFPixy Number:  9108 of 78168

Dr. Merlot, chock full of questions in a seemingly never-ending stream (and I just can't at all imagine why he has them), pursues the topic of "substantially equal periodic payments" by asking:

<<Q1a: Does this mean that if I sell the securities at a loss before 1 year, it's a short term loss or after 1 year a long term gain?>>

Yes. Just view it as a redemption within the IRA to get cash for a distribution. On receipt of the cash, you purchase stock. Your holding period starts on the day of purchase (i.e., distribution from the IRA), and your basis is the purchase price (i.e., the market value on the date of the share distribution from the IRA). Thus, unless you're saving broker's fees via the transfer, that's why I see no distinct advantage to the share transfer.

<<Q2a: Does this still hold if I use my IRA#1 for my SEPP and my IRA#2 for the educational expense withdrawals?>>

No. It only pertains to the IRA(s) you are using for the early distributions.

<<Q2b: If "yes", then could my wife use her IRA#1 for the educational expense withdrawals without negating my allowed SEPP?>>

How did your dear wife's IRA(s) get into the mix? What she does with hers has nothing to do with what you do with yours