Question by Walter Zerk: U.S. Retirement IRA Tax Question?
I am under 59 1/2 and have been taking IRA distributions for the last 15 years. These distributions were set up as substantially equal payments over my life expectancy (an annuity), and so were an exception to the usual rule prohibiting distributions before age 59 1/2.

The terms of the annuity exception to the 59 1/2 rule make it clear that there could be a recapture tax if the distribution method is changed. But there is a paragraph of Pub 590 that says I can make a one time switch to the required minimum distribution method at any time without incurring the additional tax.

My question:

Does this one time switch to the minimum distribution method exception allow me to discontinue my annuity distributions until I reach age 70 1/2 without incurring any additional taxes or penalties?

Best answer:

Answer by kckid2
I’m not clear about the one-time language. I think I know, but I don’t want to research it. You have met the conditions for the 5-year rule. What remains is that you must reach age 59 1/2. So the annuity must continue until then.

After that, you can cease the annuity, and take no more distributions (if you chose) until age 70 1/2 Once you reach age 70 1/2, you are subject to the required minimum distribution rules.

I think that answered the question you had in mind, hope so

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