-10-
An "addendum" to petitioner's letter to an Appeals officer
of the Internal Revenue Service dated October 16, 2006, describes
his calculation as follows:
The purpose of this addendum is to certify, that while
I do not have a record of my original calculations that
I used to determine my Equal Pay exception, this is my
best memory of how I arrived at that amount.
In April 2001, I reached 48 years of age. My IRA
balances were $286,000.00 [sic] I found an insurance
mortality table that estimated my life expectancy at
75, so I used 27 years for my calculation.
I used an 8% interest rate (I remember that because my
dad suggested I use 5%, but of course I knew better)
[sic]
Attached to petitioner's addendum is a schedule purporting to
show the amortization of $286,000 over 27 years at "8-percent
interest" with annual payments of $25,000. Petitioner's schedule
is reproduced as follows:
Col. 1 Col. 2 Col. 3 Col. 4 Col. 5 Col. 6
8.00% 286,000 36,542
1 286,000 25,000 261,000 21,880 282,880
2 282,880 25,000 257,880 21,630 279,510
3 279,510 25,000 254,510 21,361 275,871
4 275,871 25,000 250,871 21,070 271,941
5 271,941 25,000 246,941 20,755 267,696
6 267,696 25,000 242,696 20,416 263,112
7 263,112 25,000 238,112 20,049 258,161
8 258,161 25,000 233,161 19,653 252,814
9 252,814 25,000 227,814 19,225 247,039
10 247,039 25,000 222,039 18,763 240,802
11 240,802 25,000 215,802 18,264 234,066
12 234,066 25,000 209,066 17,725 226,791
13 226,791 25,000 201,791 17,143 218,935
14 218,935 25,000 193,935 16,515 210,449
15 210,449 25,000 185,449 15,836 201,285
16 201,285 25,000 176,285 15,103 191,388
17 191,388 25,000 166,388 14,311 180,699
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Last modified: March 27, 2008