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TimeValue Software Blog

Bi-Weekly vs Half Month Mortgage Payments

By Martel Pellerin

Occasionally a customer asks whether making half monthly payments instead of monthly payments will pay off their mortgage quicker.  The answer is no.   Let’s assume a 30-year loan. You will only save part of one month’s interest over the 30 years so it is probably not worth it and this is assuming that your bank will process your partial half month payments timely.

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Using Zero Payments for Accruals

By Martel Pellerin

Often, we have no activity on a loan or an investment but we want to know the amount of interest that is accruing or compounding. You can trigger the interest to appear by adding events such as a Payment or Invest for a $0 amount. This causes TValue to calculate the interest and, depending on the compute method, either add it to the principal if you are using Normal (compound interest) or to the accrued interest balance if you are using US Rule (simple interest).

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Understanding the IRS’ Failure to File Penalty

By Martel Pellerin

There are some penalties that are pretty straight forward and then there is the IRS Failure to File (FTF) penalty 6651(a)(1).  The FTF is a 5% per month penalty to a maximum of 5 months or 25% from the due date or the extension date, whichever is later. If the FTF and the Failure to Pay (FTP) penalty run simultaneously, you only pay 4.5% for the FTF penalty and it caps out at 22.5% as the IRS is limiting the combination of the two penalties to 5% overall.  That is the good news.

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Annuity Annual Accrual

By Martel Pellerin

A customer recently asked how to use TValue to determine the balance and annual interest contributions if they invested $100,000 in an annuity that was compounded annually for 15 years.

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Minimum Lease Payments Valuation

By Martel Pellerin

The minimum lease payments are the lowest amount that a lessee can expect to make over the lifetime of the lease. The minimum lease payments, including a guarantee of a residual if applicable, are used to value the lease by doing a net present value (NPV) calculation. The method of calculating minimum lease payments is laid out in the Statement of Financial Accounting Standards No. 13 (FAS 13), Accounting for Leases.

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