Interest rates a year from now…any guesses

L1: Interest rates a year from now…any guessesI”d like to use the 2008 one time zero cap gains (lower brackets) for some stock sales that would normally be taxable and am debating whether to start my 72t plan this month (to use the 4.97 december mid term rate). I know its late in the month but I”m told Schwab could start the 72t transfer if you take the forms to the branch office as its basically a transfer from one IRA account to the taxable one at Schwab.
I don”t need the 72t distribution this year but who knows how much money I may need in a couple of years and and am debating whethter to do it now in case the mid term rates would go extremely lower to 2%.
My question is does anybody have any insight or opinion on the mid term rates a year or two from now? I would think that if the US is going to be selling T bills to overseas buyers that they will have to raise the interest rates higher. Its not like we have a budget surplus at the US treasury.
Any opinions appreciated
2008-02-16 07:54, By: nick, IP: [68.252.46.226]

L2: Interest rates a year from now…any guessesI wouldn”t count on the ZERO tax on Capital Gains for 15% or lower taxpayers (i.e. 5% CG tax rate) to be viable for 2008. Besides, there is alimit on how much taxable income you can have in order to stay in the 15% regular income tax bracket to qualify. Be careful. Further, if you think you can sell a really large amount of investments and still be in the 15% tax bracket, watch out for the nefarious AMT (Alternative Minimum Tax) that could bite you !!!!
Meet with a tax professional, or use realy good tax software to plan before you do this.
And you didn”t mention your age, possible 401-K situation, NUA, etc. that should be taken into consideration before looking yourself into a 5-year or longer program.2008-02-16 09:32, By: dlzallestaxes, IP: [72.81.120.28]

L2: Interest rates a year from now…any guessesMy question is does anybody have any insight or opinion on the mid term rates a year or two from now?
I think we would need “Carnac the Magnificent” to answer this 😉
2008-02-18 10:40, By: Bob_85364, IP: [76.178.79.176]

L2: Interest rates a year from now…any guessesYou might take a look at the interest rate history posted under that tab on this site. It goes back to 2001 when the last rate reduction cycle started, and you will note that the mid term rate only had a couple months under 4%. The yield curve is already steepening and there is still plenty of inflation concerns out there.
No guarantee that the pattern here will be the same, but I think there is some value in looking at this past history.
2008-02-18 18:21, By: Alan S., IP: [24.116.165.60]