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interest rates

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Byttt

L1: interest ratesdo i have it correct that if doing a 72t using amortization or annuitazion rates, that the assumed rate can be between 100% mid-term, to 120% long term rates on the chart… and the actual interest rate is the rate actually being paid to the client?2004-03-29 17:23, By: ttt, IP: [216.163.246.74]
L2: interest ratesHello ttt:
The maximum interest rate assumed (or assumable) in the amortization method is 120% of the MT/AFR; the minimum rate is zero. This process then provides the annual distribution amount expressed in dollars & it is that amount that must be distributed. The actual interest rate is irrelevant in this process.
TheBadger
wjstecker@wispertel.net
2004-03-29 17:43, By: TheBadger, IP: [38.116.134.130]

L2: interest ratesthanx Badger…. Why then, on the sample form, under #6, does it say for amort. or annuitize methods. “the IRS considers a reasonable rate to be 100% mtf to 12% ltf ?2004-03-29 17:50, By: ttt, IP: [216.163.246.74]

L2: interest ratesUnfortunately, it is left over from the days when Notice 89-25was the rule- prior to 2002-62. Thanks for pointing out the error – I’ll change it tonight.
Gfw2004-03-29 18:23, By: Gfw, IP: [12.221.34.192]

L2: interest ratesBTW – While I try to keep all information up-to-date, there is always the possibility that we have missed a word, a line or a paragraph on one of the many pages in this site.
Please do not blame “The Badger” for erroneous information, it is entirely my problem and I do appreciate when someone finds an error, etc. so that we can correct.
2004-03-29 18:29, By: Gfw, IP: [12.221.34.192]

L2: interest rateshey, glad i could help out Badger!! (on fixing the error)
Is it also true that the client can take out virtually any amount they want under the rule of substantially equal payments?
2004-03-29 19:00, By: ttt, IP: [216.163.246.74]

L2: interest rates – maybe the error wasn”t ours!Perhaps you may want to spend a little time reading some of the information on the site. For example, I was starting to fix the form that you mentioned and the error that I thought was included when I read the paragraph below the interest rate option on the form that you mentioned. It clearly states … To comply with RR 2002-62, the maximum rate should be limited to 120% of the Federal Mid-Term AFR for either of the two months immediately preceeding the month that the first payment is to be made. Once established, it should remain fixed.
If you read some of the FAQ or some of the previous posts, you also come to the conclusion that NO, you can”t take out virtually any amount! You have some very definate rules and guidelines that must be followed.
And if you actually look at the message that you responded to, you”ll see that the Badger didn”t respond to your post, I did.
2004-03-29 19:12, By: Gfw, IP: [172.16.1.74]

L2: interest ratesGood morning ttt:
I assume by your post that you might be a financial advisor. May I strongly suggest that you go to the Home Page, look on the right side to the two dark blue squares, and use the second square to purchase TheBadger’s (Bill Stecker) book. It will be the best $40 you ever spent if you will be working with financial clients. I use my copy of this book regularly to answer my questions.
Good luck.
Jim2004-03-30 08:44, By: Jim, IP: [68.1.147.61]

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