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Forward Averaging |
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Forward averaging A method of calculating taxes on a lump sum distribution from a qualified retirement plan that enables the tax payer to pay less than the current tax rate. Forward Averaging A former practice allowing certain pensioners in the United States to treat lump sum retirement plan withdrawals as if they occurred over a period of five or 10 years. This allowed qualifying retirees to pay only one-fifth or one-tenth of the taxes that they would otherwise have had to pay in a given year. Forward averaging was discontinued in 2000. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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| Javaughn Espiritt, a 6-5, 185-pound forward averaging 12. It can be reported using 10-year forward averaging if the client participated in the plan for at least five years. The tax code was amended to allow 10-year forward averaging of lump-sum payments. |
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