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Five year forward averaging


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Guest turbodiesel39
Posted

I am almost certain that I read somewhere that the 5 year forward averaging method of paying out a qualified plan participant is no longer permissable after 2000. I have this question because I know 10 year averaging is certainly still an option under 72(t). Is 5 year averaging still available?

Thank you in advance for your help.

Posted

Perhaps a terminology issue? Your question refers to "paying out". The following IRS "Special Tax Notice" contains a reference to "10-year averaging" with respect to the taxation of a distribution.

http://www.benefitslink.com/IRS/notice2002-3.shtml

I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

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