By Andy Ives, CFP®, AIF®
IRA Analyst



I’ve got a client who is retiring early. He has roughly $1,000,000 in an IRA now which he could initiate a 72(t) with.  That will not generate enough cash flow to support their needs.

He also has an additional $3 million in his employer’s ESOP which, under the terms of the ESOP, will not be available for an IRA rollover until August of the year after he retires.

Can he do a 72(t) with his current IRA and then when he rolls out the funds from the ESOP can he do a 2nd 72(t) with that? In other words, can you have two IRA’s both with 72(t)s at the same time?




Yes, a person can have two different 72(t) payment schedules from two different IRAs, but tread lightly. You did not mention your client’s age in your email, which has a significant impact on 72(t) distributions. For the uninitiated, a 72(t) payment schedule allows a person under age 59 ½ to tap their IRA accounts penalty free. However, the payments must continue for the LONGER of five years or until you reach age 59½. If your client is only 45, he is looking at a minimum 15 years’ worth of payments. A lot can happen in that time period, and 72(t) schedules cannot be changed. The payments are ineligible to be rolled over, and any missteps along the way could wreck the entire 72(t) schedule, potentially resulting in a 10% early distribution penalty on all previous distributions.


Dear Mr. Slott and team:

I hope you can help me.  Despite reading much of the IRS web information, and many other websites on RMDs from IRAs, I have some remaining confusion on taking my first RMD. Here’s the situation I have questions about:

I turn 70 1/2 on November 8, 2021. I understand my Required Beginning Date (RBD) is April 1, 2021; the year I turn 70 1/2, correct?  Then although I can defer my first RMD until April 1 of 2022 (which is the year following the year I turn 70 1/2.) I’d rather take my first RMD in the year in which I turn 70 1/2, which is 2021. My questions are:

1) Will any of the distributions I take in Jan./Feb./Mar of 2021 count toward my first RMD?  They will be IRA distributions taken in the year I turn 70 1/2 but they occur before my RBD.

2) When I take my first RMD in calendar year 2021, do I base it on my IRA balance from Dec. 31 of the prior year (when I was 69 1/2)?

3) In 2022, when I go to make my second RMD, I base this RMD amount on the balance of my IRA as of Dec. 31, 2021, correct?

Many thanks for your help.





It appears some of your numbers are off by one year. You turn 70 ½ in November 2021. That means 2021 is your very first year with an RMD, and your required beginning date (RBD) is the FOLLOWING year – April 1, 2022. Your first RMD is for 2021, but you can delay it until April 1, 2022. If you do elect to delay, you will have two RMDs in 2022.

Now, since you said you would prefer to take your RMD in the year you turn 70 ½ and not delay, to answer each of your questions:

1) Any distributions you take in 2021 (the year you turn 70 ½) will count toward your RMD, regardless of when you take them during the calendar year. In fact, the first money out of the IRA will always count toward your RMD for the year.

2) Your first RMD in 2021 will be based on the year-end balance from 2020. (Disregard your age in 2020  – it will only confuse things.)

3) Correct, when you take your second RMD in 2022, it is based on the balance as of December 31, 2021.