MAP 21 Interest Rates

[Dougsbpc]

It is my understanding that the funding relief interest rates will not be available to a plan that is using the full yield curve. Agree?

Thanks

[david rigby]

No. This is the text of Act section 40211©. [Page 446 of the 584-page PDF document on Thomas or the GPO website.]

© EFFECTIVE DATE.—

(1) IN GENERAL.—The amendments made by this section shall apply with respect to plan years beginning after December 31, 2011.

(2) RULES WITH RESPECT TO ELECTIONS.—

(A) ADJUSTED FUNDING TARGET ATTAINMENT PERCENTAGE.— A plan sponsor may elect not to have the amendments made by this section apply to any plan year beginning before January 1, 2013, either (as specified in the election)—

(i) for all purposes for which such amendments apply, or

(ii) solely for purposes of determining the adjusted funding target attainment percentage under sections 436 of the Internal Revenue Code of 1986 and 206(g) of the Employee Retirement Income Security Act of 1974 for such plan year. A plan shall not be treated as failing to meet the requirements of sections 204(g) of such Act and 411(d)(6) of such Code solely by reason of an election under this paragraph.

(B) OPT OUT OF EXISTING ELECTIONS.—If, on the date of the enactment of this Act, an election is in effect with respect to any plan under sections 303(h)((2)(D)(ii) of the Employee Retirement Income Security Act of 1974 and 430(h)((2)(D)(ii) of the Internal Revenue Code of 1986, then, notwithstanding the last sentence of each such section, the plan sponsor may revoke such election without the consent of the Secretary of the Treasury. The plan sponsor may make such revocation at any time before the date which is 1 year after such date of enactment and such revocation shall be effective for the 1st plan year to which the amendments made by this section apply and all subsequent plan years. Nothing in this subparagraph shall preclude a plan sponsor from making a subsequent election in accordance with such sections.

However, if your question means "will there be an alternative yield curve using 25-year averages?", there is no indication of that in the statute.

[david rigby]

Released 08/16/12

http://benefitslink.com/src/irs/notice2012-55.pdf