Change in maximum % amount permissiable

L1: Change in maximum % amount permissiableNeed help. I did not realize that the amount you can take from your IRA under 72-t was changing. When I looked at my situation last year, I could easily take the amount I need annually if I used a 10% rate. I did the math to make sure that I wouldn”t run out of money before my required distributions can stop (money is fixed – not in the mkt). Is there any relief for people like myself you were ignorant of the rule change and need to use a higher interest rate? I have other funds so if my account runs out of money before I die it”s not a problem. However, I need the higher distributions for the next 7 years. This is a big problem and any input would be appreciated.2003-04-07 16:58, By: Stressed, IP: [127.0.0.1]
L2: Change in maximum % amount permissiableHello Stressed:
I am sorry to report that there is NO relief for those ignorant of the law. As an aside, 10% would have been challenged last year as well.

TheBadger
wjstecker@wispertel.net
2003-04-07 17:10, By: TheBadger, IP: [127.0.0.1]

L2: Change in maximum % amount permissiableWhen the badger is right, he is really right! 10% wouldn”t have worked last year and there is about a 100% chance that it won”t work this year. Early last year you might have squeezed in a 7% rate, but 10%… don”t really think so.Looks like plans started in May will have a maximum rate of 3.89%
Good luck. 2003-04-07 18:02, By: Gfw, IP: [127.0.0.1]

L2: Change in maximum % amount permissiableThanks for the input. Why wouldn”t 10% have worked last year? I”m not questioning your answer, I just want to be more informed. Do you have a reference to the old rule so I can understand this better. I advised someone else on how to do their 72-t and feel really bad that they could have taken more out had they started the distributions in “02. Thanks.2003-04-08 08:09, By: Stressed, IP: [127.0.0.1]

L2: Change in maximum % amount permissiableHello Stressed:
Prior to 1/1/03 (wen Revenue Ruling 2002-62 became mandatory) one looked to Notice 89-25 for guidance on methods, life expectancies & interest rates. Notice 89-25 was vague in that it said “at a rate that does not exceed a reasonable interest rate on the date payments commence”. Of course, the the key word was “reasoanble” and left alot of room for interpretation. Nonetheless, the IRS is in the business of determining what constitutes a reasonable interest rate (Congress told them to do it) through the publication of monthly AFRs. During the period 1989 to 2002, approximately 100 PLRs were issued and essentially all of them approved interest rates that were equal to or less than 120% of the LT/AFR +1%; ore often just 120% of LT/AFR. As an example, back in 9/02, this would have generated a rate window of 6.3% to 7.3% as a maximum; a far cry from 10%. In fact, to best of my knowledge, no PLR has ever approved a double digit interest rate. Lastly, remember that the IRC re
2003-04-08 08:30, By: TheBadger, IP: [127.0.0.1]

L2: Change in maximum % amount permissiableSorry — hit enter too soon on last post.
Hello Stressed:
Prior to 1/1/03 (wen Revenue Ruling 2002-62 became mandatory) one looked to Notice 89-25 for guidance on methods, life expectancies & interest rates. Notice 89-25 was vague in that it said “at a rate that does not exceed a reasonable interest rate on the date payments commence”. Of course, the the key word was “reasoanble” and left alot of room for interpretation. Nonetheless, the IRS is in the business of determining what constitutes a reasonable interest rate (Congress told them to do it) through the publication of monthly AFRs. During the period 1989 to 2002, approximately 100 PLRs were issued and essentially all of them approved interest rates that were equal to or less than 120% of the LT/AFR +1%; ore often just 120% of LT/AFR. As an example, back in 9/02, this would have generated a rate window of 6.3% to 7.3% as a maximum; a far cry from 10%. In fact, to best of my knowledge, no PLR has ever approved a double digit interest rate. Lastly, remember that the IRC requires a reasonabvle interest rate within the context of the “life expectancy of the beneficiary” & is therefore unrelated to investor returns or SEPP programs that are specifically designed to last materially less than the life time of the beneficiary.
TheBadger
wjstecker@wispertel.net
2003-04-08 08:33, By: TheBadger, IP: [127.0.0.1]