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Enter the Assumed Applicable Federal Rate (AFR) here which will be used as the loan interest rate in the Loan Based Split Dollar Plan between Employer and Executive. Click Add Row feature to make AFR rate changes.
So long as the loan interest rate on all loans is equal to or exceeds the AFR established under IRC Sections 7872(f)(2)(A) and 1274(d), no further interest will be imputed by the IRS on the transaction. For current AFRs in effect, please go to the following website: https://apps.irs.gov/app/picklist/list/federalRates.html