Forward Averaging
Treating lump-sum retirement-plan distributions as if they occurred over a five- or ten-year period. Forward averaging is available only to qualified plan participants who were born before 1936 and meet certain requirements.
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.
However, with a tax break called forward averaging, just one tax is paid. This tax is determined by calculating the total amount that would have been paid if the money had been collected in installments.
 See also: Averaging, Contribution, Vesting, Investment, Issue
  
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