A rotor supported by magnetic bearings can be made to spin about its inertia axis, thus greatly attenuating the imbalance forces that are transmitted through the bearings. Conventional control schemes using tracking notch filters to achieve this purpose are sometimes unstable. This paper presents a rotordynamic analysis, in the form of a computer code, to explain and predict stability in systems using these filters. An alternative balancing scheme, called Virtual Balancing, which is used to implement stable balancing with magnetic bearings, is also described. This scheme treats the bearings as balancing planes and applies an influence coefficient method to relate machine casing vibrations to feed-forward control signals injected to the bearings.