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What is Amortization Method?

Definition of Amortization Method

The IRS (Internal Revenue Service) approved method of calculating distribution of penalty-free withdrawals from the personal retirement account (PRS). It provides a fixed annual distribution amount that once determined is never adjusted to changes in the level of income or life expectancy. The IRS limits how much can be withdrawn by assuming any future earnings will be at most 120% of the Federal mid-term rate.
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