Retirement Plan Analyzer v. 2009.00 was released on 11/09/09 (with v. 2009.02 released on 2/19/10).  A v. 2009.00 or later to v. 2009.02 Patch File is available to download.  Version 2009.00 added a new Case Analyzer feature.  Retirement Plan Analyzer is one of Brentmark's best-selling programs.  The program is compliant with the Pension Protection Act of 2006.
     Retirement Plan Analyzer includes comprehensive Roth IRA conversion features.  Roth IRA conversions in any one or multiple years may be modeled.  Retirement Plan Analyzer may be used to evaluate various strategies (showing up to 4 alternatives at one time) of taking distributions from IRAs, Roth IRAs, Roth 401(k)s, and other qualified retirement plans.  It takes into account federal estate tax, state death taxes, and income tax.  The program handles the 2002 final regulations (as well as the 2001 proposed regulations and the pre-2001 rules) for required minimum distributions and pre-59½ distributions.
     Retirement Plan Analyzer handles pre-59½ distributions that avoid the 10% penalty, Roth IRA conversions, valuation of stretchout, and much more.  Retirement Plan Analyzer may be licensed for $595 (or download now for $570) with six months maintenance coverage included.  After the first six months, maintenance is priced at $179 annually.  A downloadable demo is available.

Retirement Distributions Planner v. 10.01 was released on 8/27/09.  A v. 10.00 to v. 10.01 Patch File is available to download.  The program was previously known as the Pension Distributions Planner.  The program offers exhaustive treatment of required minimum distributions and pre-59½ distributions.  The program handles up to five beneficiaries either after the death of the plan owner or after the death of a spouse after a spousal rollover.  Reports show annual distributions and the life expectancy for each beneficiary as well as total distributions to each beneficiary and yearly distributions to all beneficiaries.  The Retirement Distributions Planner may be licensed for $249 (or download now for $224) with six months maintenance coverage included.  After the first six months, optional annual maintenance coverage is priced at $79.  The program requires Windows 98 or later.  The current user manual is available for download in PDF file format.  Now available: Case Studies and Sample Reports.

The Brentmark Update System v. 2008.05 is available as a download.  It can now display program specific information on changes (such as new features and bug fixes) found in available downloadable patch files as well as information on impending upgrades.  It is recommended that all users of Brentmark software products install Brentmark Update System v. 2008.05.  If you received your Brentmark software product by mail, you have most likely already installed an earlier version of the Brentmark Update System.  If you downloaded your Brentmark software, you should download and install the Brentmark Update System.  It is recommended that you run the Brentmark Update System at least once a month to be assured that you are running the most recent version of your Brentmark program. 

Kugler Estate Analyzer™ v. 2009.10 was released on 7/6/09.  (Click on the preceding product name link for more product information.)  The program handles comprehensive estate planning using a building blocks approach.  This approach allows you to show the effect of adding planning techniques (such as GRATs, Rolling GRATs, charitable trusts, QPRTs, Family Limited Partnerships, GST Trusts, and many more).  The program may be licensed for $595 (or download now for $570) with six months maintenance coverage included.  After the first six months, maintenance is priced at $199 annually.  A demo program, sample report, and user manual are available to download.

Charitable Financial Planner version 2010.00 was released on 7/19/10.  In addition to handling split-interest charitable transfers, the program also covers QPRTs, GRATs, and GRUTs.  A downloadable demo is available.  The user manual is available to download.  Charitable Financial Planner licenses for $349 (requires Windows 98 or later).

• August 2010, 2.6% (2.62)
• July 2010, 2.8% (2.83)
• June 2010, 3.2% (3.27)
• May 2010, 3.4% (3.45)

Note: The August 2010 rate was added to this site on 7/19/2010.

• Previous AFRs
  

The 120% Mid-Term Applicable Federal Rates for Pre-59½ retirement plan distributions:

• "Reasonable" interest rates

Retirement Planning Taxation Issues

The 8/13/07 issue of Forbes included an article, Tax-Free in the Rust Belt, by Ashlea Ebeling, (registration is required to access the article online although a Google search for the article title can also find it).  The article discusses numerous tax issues for retirees including state income taxes on retirement plans, Roth 401(k) issues, real estate taxes, and state estate taxes.  

Roth IRA Issues

The 5/24/04 issue of Forbes included an article, Conversion Time, by Ashlea Ebeling (registration is required to access the article online).  The article discusses the advantages of Roth IRA Conversions and mentions Brentmark's Online Roth IRA Conversion Calculator. 

The Taxpayer Relief Act of 1997 added the Roth IRA. The Roth IRA allows contributions without a tax deduction. However, the withdrawals are tax-free and not subject to minimum distribution rules during the life of the participant. The participant can continue to contribute to the IRA until his death. See the Roth IRA Web Site for statutory language and other information.

Existing IRAs may be converted to Roth IRAs starting in 1998. However, conversions may only be done in a year in which one's AGI is less than $100,000. The amount converted is subject to income taxation. They advantages of the Roth IRA are so great in many cases that it will often make sense to try to reduce AGI below $100,000 in order to qualify for the conversion.

Commentary:
The final Roth IRA regulations provide that "For taxable years beginning after December 31, 2004, and solely for purposes of the $100,000 limitation applicable to conversions, modified AGI does not include any required minimum distributions from an IRA..."  (Note: It now appears that minimum distributions from Qualified Plans will not be treated similarly.)  This will allow more people to qualify for Roth IRA conversions in 2005 and later.

The attractiveness of converting to the Roth IRA greatly depends on your assumptions on growth, taxes, ages and many other variables. You need to run the numbers to see if it makes sense in a particular case. However, in many cases, the analysis will come down to how and when to convert, not whether to convert.

A web site dealing exclusively with Roth IRA issues can be found at http://www.rothira.com. Be sure to check out the articles Evaluating the Roth IRA: How Much Deferral Can You Handle? and Five Financial Features that Make Conversion to a Roth IRA So Desirable by Gregory Kolojeski, President of Brentmark Software.

Pension Planning Source Material

For a discussion of short period distributions (such as monthly payments starting after January), see the article §72(t) Substantially Equal Periodic Payments Made More Frequently than Annually.  This article concludes that a distribution of a full year's amount (when the fixed amortization or annuitization method is used) for a short period is a violation of the "substantially equal periodic payments" requirement.

Required Minimum Distributions Rules

The final retirement plan distribution regulations were published on 4/17/02 in Treasury Decision 8987.  The final regulations replace the current life expectancy tables used to calculate required minimum distributions with updated tables.  The new tables are mandatory for 2003 with 3 different required distribution methods allowable for 2002: the final regs with the new tables, the 2001 proposed regs with old tables, and the pre-2001 (1987 proposed regs) methods with old tables.  Click here for the 2002 final regs.

Also available: Sy Goldberg's Planning Analysis: Working with the 2002 IRS Final Distribution Rules.

Click here for the article, Required Minimum Distributions: Calculations under the Final Regulations.

Click here for info on the prior 2001 Proposed Regs.

The Economic Growth and Tax Relief Act Reconciliation Act of 2001 (which was signed into law on 6/7/01) includes equivalent exemptions for estate tax purposes as follows:

2002 & 2003: $1,000,000
2004 & 2005: $1,500,000
2006 to 2008: $2,000,000
2009: $3,500,000
2010: N/A (taxes repealed)
2011: $1,000,000*

*This amount would apply in 2011 were the 2001 tax bill to sunset.

It is expected that major estate tax changes will be passed by Congress in 2010.

For information on state death taxes, go to StateDeathTax.com which has information and links on the status of state death taxes.

The IRS released new actuarial value tables based on a new life expectancy table (Table 2000CM) for income, estate and gift tax purposes.  The new actuarial values are applicable starting May 1, 2009 for valuing annuities, life estates, remainders, and reversions.  According to T.D. 9448, either Table 90CM or Table 2000CM may be used during the transition period for May and June 2009. 

In a December 2000 GRAT valuation case (Audrey J. Walton v. Commissioner), the Tax Court agreed with the taxpayer's position that a term GRAT should be valued as a term GRAT and not as a shorter of term or life GRAT as per Example 5 [Sec. 25.2702-3(e), Example (5)] of the gift tax regulations.  Furthermore, the court found Example 5 of the regulations to be invalid.  The case is also available as a PDF file at the Tax Court web site at www.ustaxcourt.gov.

Links

Check out our Links to other web sites with estate, tax, and retirement planning content.

Other Software

We often get requests for software on topics for which we have not developed a product. Topics include Interrelateds, Business Valuation, IRS Interest & Penalties, Sales Tax and Social Security Benefits (the latter software being available for free!). We have put together a list of Recommended Software covering those topics. Included is information on Cammack Computations' Inter-Est program, which handles interrelated estate tax calculations.  For information on QP-SEP Illustrator and SIMPLE Illustrator, click on GSL Galactic Computing.

Free Demo Disks

Demo versions are available for the following Windows programs:  Retirement Plan Analyzer, Estate Planning Tools, Kugler Estate Analyzer, Charitable Financial Planner, Retirement Income Navigator, Estate Planning QuickView, Savings Bond Toolkit and PFP Notebook. All the demos are working models (with some values locked-in).  Demos for the programs highlighted in black above are available to download now.

To request case studies for any of the programs and a free CD of Brentmark demos, please e-mail your request (with the word Demos in the subject line and be sure to include your postal address) or call 1-800-879-6665. All Brentmark demos are now available on one CD.

Following are ways to reach Brentmark:

Telephone

1-800-879-6665 or 407-306-6160

FAX

407-306-6107

Postal address

3505 Lake Lynda Dr., Suite 119, Orlando, FL 32817-8333

Electronic mail

Sales:

Demos:
Technical support: