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URL:  http://boards.fool.com/if-i-withdraw-my-annunity-before-59-12-can-this-11796011.aspx

Subject:  Re: Anunity Date:  1/12/2000  2:19 PM
Author:  TheBadger Number:  17713 of 75381

If i withdraw my annunity before 59 1/2 can this be rolled into an Ira without paying the 10% penailty or income tax?


On the presumption that you are referring to regular after-tax annuity; it is not rollable into an IRA; therefore you will, at a minimum, owe regular income tax on the amount distributed less your basis in the contract.

However, you can avoid the 10% early withdrawal surtax through implimentation of IRC §72(q)(2)(D) SEPP's. §72(q) does not get discussed much; however, the rules for §72(q) are essentially the same as those for §72(t), its companion code section for 401(k)'s & IRA's. I suggest that you stroll over to the Retire Early Homepage & start reading the posts on §72(t) get some background information.

TheBadger

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