I have signed a prior year schedule B. Having found an error in the prior valuation (my first ever, of course...) I would really like to change the prior interest assumption to compensate, since I am amending the schedule B anyway. I know that the funding method cannot be changed once a schedule B is filed. Can assumptions be changed? I realize my assumptions always need to be reasonable. I want to be correct and ethical, etc in this - just wondering if I have any latitude here. I have always assumed I couldn't make such a change, but just thought I would ask the question.....

Lots of stuff from the IRS that says you can not change assumptions when you amend a Schedule B. If you search this board I'm sure you will find the necessary sites.

That said, I have seen actuaries who amended Sch B's and changed assumptions and the IRS never said anything (yet), but it is a "no no".

The IRS is pretty adamant about not being able to change assumptions once a Schedule B is filed, even if it is filed by a different actuary. They seem oblivious to the obvious conundrums such a policy engenders. There is a Rev Rul "way back when" that lays out their position. Essentially, you are able to change assumptions only if the error you are correcting is directly tied to and renders the assumption being changed inappropriate. There are no specific examples given. For all practical purposes you just can't change, without being willing to fight the IRS' position.

Thanks all - that was my understanding - but thought I'd get another opinion.