Federal rates; adjusted federal rates; adjusted federal long-term rate and the long-term exempt rate. For purposes of sections 382, 642, 1274, 1288, and other sections of the Code, tables set forth the rates for August 2013.

Proposed regulations provide rules under section 36B of the Code relating to requirements for Affordable Insurance Exchanges to report information relating to the health insurance premium tax credit, enacted by section 1401 of the Affordable Care Act. Comments requested by September 3, 2013.

2013 Section 43 Inflation Adjustment. This notice announces the inflation adjustment factor and phase-out amount for the enhanced oil recovery credit for taxable years beginning in the 2013 calendar year. The notice concludes that the enhanced oil recovery credit for qualified costs paid or incurred in 2013 is phased out completely. The notice also contains the previously published figures for taxable years beginning in the 1991 through 2012 calendar years.

This notice provides updated static mortality tables to be used by defined benefit pension plans for purposes of satisfying certain funding and benefit requirements under the Code and the Employee Retirement Income Security Act of 1974 (ERISA). These tables apply for purposes of calculations for valuation dates occurring during calendar years 2014 and 2015. The notice also includes a modified unisex version of the mortality tables for use in determining the minimum present value for distributions with annuity starting dates that occur during stability periods beginning in calendar years 2014 and 2015. The notice also requests comments by October 8, 2013, regarding the publication of mortality tables for future years.

It is the policy of the Internal Revenue Service to announce at an early date whether it will follow the holdings in certain cases. An Action on Decision is the document making such an announcement. An Action on Decision will be issued at the discretion of the Service only on unappealed issues decided adverse to the government. Generally, an Action on Decision is issued where its guidance would be helpful to Service personnel working with the same or similar issues. Unlike a Treasury Regulation or a Revenue Ruling, an Action on Decision is not an affirmative statement of Service position. It is not intended to serve as public guidance and may not be cited as precedent.

Actions on Decisions shall be relied upon within the Service only as conclusions applying the law to the facts in the particular case at the time the Action on Decision was issued. Caution should be exercised in extending the recommendation of the Action on Decision to similar cases where the facts are different. Moreover, the recommendation in the Action on Decision may be superseded by new legislation, regulations, rulings, cases, or Actions on Decisions.

Prior to 1991, the Service published acquiescence or nonacquiescence only in certain regular Tax Court opinions. The Service has expanded its acquiescence program to include other civil tax cases where guidance is determined to be helpful. Accordingly, the Service now may acquiesce or nonacquiesce in the holdings of memorandum Tax Court opinions, as well as those of the United States District Courts, Claims Court, and Circuit Courts of Appeal. Regardless of the court deciding the case, the recommendation of any Action on Decision will be published in the Internal Revenue Bulletin.

The recommendation in every Action on Decision will be summarized as acquiescence, acquiescence in result only, or nonacquiescence. Both “acquiescence” and “acquiescence in result only” mean that the Service accepts the holding of the court in a case and that the Service will follow it in disposing of cases with the same controlling facts. However, “acquiescence” indicates neither approval nor disapproval of the reasons assigned by the court for its conclusions; whereas, “acquiescence in result only” indicates disagreement or concern with some or all of those reasons. “Nonacquiescence” signifies that, although no further review was sought, the Service does not agree with the holding of the court and, generally, will not follow the decision in disposing of cases involving other taxpayers. In reference to an opinion of a circuit court of appeals, a “nonacquiescence” indicates that the Service will not follow the holding on a nationwide basis. However, the Service will recognize the precedential impact of the opinion on cases arising within the venue of the deciding circuit.

The Commissioner ACQUIESCES in the following decision:

Karen Marie Wilson v. Commissioner ^[1]

705 F.3d 980 (9th Cir. 2013), aff’g T.C. Memo. 2010-134

The Commissioner does NOT ACQUIESCE in the following decision:

Media Space, Inc. v. Commissioner ^[2]

135 T.C. 424 (2010), vacated, 477 Fed. Appx. 857 (2nd Cir. 2012)

This revenue ruling provides various prescribed rates for federal income tax purposes for August 2013 (the current month). Table 1 contains the short-term, mid-term, and long-term applicable federal rates (AFR) for the current month for purposes of section 1274(d) of the Internal Revenue Code. Table 2 contains the short-term, mid-term, and long-term adjusted applicable federal rates (adjusted AFR) for the current month for purposes of section 1288(b). Table 3 sets forth the adjusted federal long-term rate and the long-term tax-exempt rate described in section 382(f). Table 4 contains the appropriate percentages for determining the low-income housing credit described in section 42(b)(1) for buildings placed in service during the current month. However, under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July 30, 2008, with respect to housing credit dollar amount allocations made before January 1, 2014, shall not be less than 9%. Finally, Table 5 contains the federal rate for determining the present value of an annuity, an interest for life or for a term of years, or a remainder or a reversionary interest for purposes of section 7520.

This notice provides updated static mortality tables to be used under § 430(h)(3)(A) of the Internal Revenue Code (Code) and § 303(h)(3)(A) of the Employee Retirement Income Security Act of 1974 (ERISA), and requests comments regarding the publication of mortality tables for future years. These tables apply for purposes of calculating the funding target and other items for valuation dates occurring during calendar years 2014 and 2015.

This notice also includes a modified unisex version of the mortality tables for use in determining minimum present value under § 417(e)(3) of the Code and § 205(g)(3) of ERISA for distributions with annuity starting dates that occur during stability periods beginning in the 2014 and 2015 calendar years.

Section 412 of the Code provides minimum funding requirements that generally apply for defined benefit plans. Section 412(a)(2) provides that § 430 specifies the minimum funding requirements that generally apply to defined benefit plans that are not multiemployer plans. Section 430(a) defines the minimum required contribution for such a plan by reference to the plan’s funding target for the plan year.

Section 430(h)(3) provides rules regarding the mortality tables to be used under § 430. Under § 430(h)(3)(A), except as provided in § 430(h)(3)(C) or (D), the Secretary is to prescribe by regulation mortality tables to be used in determining any present value or making any computation under § 430. Those tables are to be based on the actual experience of pension plans and projected trends in that experience. Section 430(h)(3)(B) provides that periodically (at least every 10 years) these mortality tables shall be revised to reflect the actual experience of pension plans and projected trends in that experience.

Section 430(h)(3)(C) provides that, upon request by a plan sponsor and approval by the Secretary, substitute mortality tables that meet the applicable requirements may be used in lieu of the standard mortality tables provided under § 430(h)(3)(A). Section 430(h)(3)(D) provides for the use of separate mortality tables with respect to certain individuals who are entitled to benefits on account of disability, with separate tables for those whose disabilities occurred in plan years beginning before January 1, 1995, and those whose disabilities occurred in plan years beginning after December 31, 1994. These separate mortality tables are permitted to be used with respect to disabled individuals in lieu of the generally applicable mortality tables provided pursuant to § 430(h)(3)(A) or the substitute mortality tables under § 430(h)(3)(C).

Section 1.430(h)(3)-1 of the regulations provides for mortality tables, based on the tables contained in the RP-2000 Mortality Tables Report,^[3] adjusted for mortality improvement using Projection Scale AA as recommended in that report. Section 1.430(h)(3)-1 generally requires the use of separate tables for nonannuitant and annuitant periods for large plans (those with over 500 participants as of the valuation date). Sponsors of small plans (those with 500 or fewer participants as of the valuation date) are permitted to use a combined table that applies the same mortality rates to both annuitants and nonannuitants.

Section 1.430(h)(3)-1 describes the methodology that the IRS will use to establish mortality tables as provided under § 430(h)(3)(A). The mortality tables set forth in § 1.430(h)(3)-1 are based on expected mortality as of 2000 and reflect the impact of expected improvements in mortality. The regulations permit plan sponsors to apply the projection of mortality improvement in either of two ways: through use of static tables that are updated annually to reflect expected improvements in mortality, or through use of generational tables. The regulations include static mortality tables for use in actuarial valuations as of valuation dates occurring in 2008 and provide that the mortality tables for valuation dates occurring in future years are to be provided in the Internal Revenue Bulletin. Notice 2008-85, 2008-42 IRB 905, sets forth the static mortality tables that apply under § 430(h)(3)(A) for valuation dates during 2009 through 2013.

For a plan for which the effective date of § 430 is delayed pursuant to sections 104 or 105 of the Pension Protection Act of 2006, Public Law 109-280, current liability under § 412(l)(7) must be determined in order to calculate the plan’s minimum required contribution. Section 1.412(l)(7)-1(a) provides that for plan years beginning on or after January 1, 2008, the mortality tables described in § 430(h)(3)(A) are to be used to determine current liability under § 412(l)(7) of the Code for nondisabled participants.

Section 1.431(c)(6)-1 provides that the same mortality assumptions that apply for purposes of § 430(h)(3)(A) and § 1.430(h)(3)-1(a)(2) are used to determine a multiemployer plan’s current liability for purposes of applying the full-funding rules of § 431(c)(6). For this purpose, a multiemployer plan is permitted to apply either the annually-adjusted static mortality tables or the generational mortality tables.

Section 417(e)(3) generally provides that the present value of certain benefits under a qualified pension plan (including single-sum distributions) cannot be less than the present value of the accrued benefit using applicable interest rates and the applicable mortality table. Under § 1.417(e)-1(d), these rules must also be used to compute the present value of a plan benefit for purposes of determining whether consent for a distribution is required under § 411(a)(11)(A).

Section 417(e)(3)(B) defines the term “applicable mortality table” as the mortality table specified for the plan year under § 430(h)(3)(A) (without regard to § 430(h)(3)(C) or (D)), modified as appropriate by the Secretary.

Rev. Rul. 2007-67, 2007-2 C.B. 1047, provides that, except as otherwise stated in future guidance, the applicable mortality table under § 417(e)(3) for 2008 is based on a fixed blend of 50% of the static male combined mortality rates and 50% of the static female combined mortality rates promulgated under § 1.430(h)(3)-1(c)(3) of the proposed regulations (which have since been issued as final regulations). The applicable mortality table for purposes of § 417(e)(3) is not a generational table. Rev. Rul. 2007-67 also provides that the applicable mortality table for a given year applies to distributions with annuity starting dates that occur during stability periods that begin during that calendar year. Rev. Rul. 2007-67 further states that the § 417(e)(3) applicable mortality table for each subsequent year will be published in future guidance and, except as provided in that future guidance, will be determined from the § 430(h)(3)(A) tables on the same basis as the applicable mortality table for 2008. Notice 2008-85 set forth the § 417(e)(3) applicable mortality tables for distributions with annuity starting dates that occur during stability periods beginning during calendar years 2009 through 2013.

The static mortality tables that apply under § 430(h)(3)(A) for valuation dates during 2014 and 2015 are set forth in the appendix to this notice. The mortality rates in these tables have been developed from the base rates, projection factors, and weighting factors set forth in § 1.430(h)(3)-1, using the blending techniques described in the preamble to those regulations.

The static mortality tables that apply under § 417(e)(3) for distributions with annuity starting dates occurring during stability periods beginning in 2014 and 2015 are set forth in the appendix to this notice in the column labeled “Unisex.” These tables were derived from the tables used for § 430(h)(3)(A) following the procedures set forth in Rev. Rul. 2007-67.

As noted in § 430(h)(3)(B) the IRS and Treasury are required to revise the mortality tables used under § 430(h)(3)(A) at least every 10 years, to reflect the actual mortality experience of pension plans and projected trends in that experience. The IRS and Treasury are aware of a study that is currently being conducted by the Society of Actuaries to measure the actual experience and trends in mortality for participants of uninsured pension plans in the United States and an associated report issued in September 2012.^[4] Comments are requested as to whether other studies of actual mortality experience of pension plans and projected trends of that experience are available that should be considered for use in developing mortality tables for future use under § 430(h)(3).

Section 430(h)(3)(D) and Rev. Rul. 96-7, 1996-1 C.B. 59 provide for separate mortality tables for disabled participants whose disabilities occurred in plan years beginning before January 1, 1995, and for those whose disabilities occurred in plan years beginning after December 31, 1994. Comments are requested as to whether it is reasonable to expect that the mortality experience for participants who became disabled before 1995 will continue to be sufficiently substandard so that a separate mortality table is warranted for future use with respect to those disabled participants under § 430(h)(3).

The existing regulations under § 430(h)(3)-1 provided a number of alternative versions of the mortality tables that were simplified in order to accommodate limitations in actuarial software. In developing updated regulations, comments are requested as to:

Written or electronic comments must be received by October 8, 2013. Send submissions to CC:PA:LPD:PR (Notice 2013-49), Room 5203, Internal Revenue Service, POB 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to: CC:PA:LPD:PR (Notice 2013-49), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC. Alternatively, comments may be submitted via the Internet at notice.comments@irscounsel.treas.gov. Please include “Notice 2013-49” in the subject line of any electronic communication. All materials submitted will be available for public inspection and copying.

The principal author of this notice is Carolyn E. Zimmerman of the Employee Plans, Tax Exempt and Government Entities Division. For further information regarding this notice, please contact Ms. Zimmerman at retirementplanquestions@irs.gov.

Section 43(b)(3)(B) of the Internal Revenue Code requires the Secretary to publish an inflation adjustment factor. The enhanced oil recovery credit under § 43 for any taxable year is reduced if the “reference price,” determined under § 45K(d)(2)(C), for the calendar year preceding the calendar year in which the taxable year begins is greater than $28 multiplied by the inflation adjustment factor for that year. The credit is phased out in any taxable year in which the reference price for the preceding calendar year exceeds $28 (as adjusted) by at least $6.

The term “inflation adjustment factor” means, with respect to any calendar year, a fraction the numerator of which is the GNP implicit price deflator for the preceding calendar year and the denominator of which is the GNP implicit price deflator for 1990.

Because the reference price for the 2012 calendar year ($94.53) exceeds $28 multiplied by the inflation adjustment factor for the 2012 calendar year ($28 multiplied by 1.5968 = $44.71) by $49.82, the enhanced oil recovery credit for qualified costs paid or incurred in 2013 is phased out completely.

Table 1 contains the GNP implicit price deflator used for the 2013 calendar year, as well as the previously published GNP implicit price deflators used for the 1991 through 2012 calendar years.

Table 2 contains the inflation adjustment factor and the phase-out amount for taxable years beginning in the 2013 calendar year as well as the previously published inflation adjustment factors and phase-out amounts for taxable years beginning in the 1991 through 2012 calendar years.

The principal author of this notice is Brian J. Americus of the Office of Associate Chief Counsel (Passthroughs and Special Industries). For further information regarding this notice, contact Mr. Americus at (202) 622-3110 (not a toll-free call).

Internal Revenue Service (IRS), Treasury.

Notice of proposed rulemaking.

This document contains proposed regulations relating to requirements for Affordable Insurance Exchanges (Exchanges) to report information relating to the health insurance premium tax credit enacted by the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010. These proposed regulations affect Exchanges that make qualified health plans available to individuals and employers.

Written (including electronic) comments and requests for a public hearing must be received by September 3, 2013.

Send submissions to: CC:PA:LPD:PR (REG-140789-12), Room 5203, Internal Revenue Service, PO Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-140789-12), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC, or sent electronically via the Federal eRulemaking Portal at www.regulations.gov (IRS REG-140789-12).

Concerning the proposed regulations, Arvind Ravichandran, (202) 622-4920; concerning the submission of comments, and/or requests for a public hearing, Oluwafunmilayo Taylor, (202) 622-7180 (not toll-free calls).

Accordingly, 26 CFR part 1 is proposed to be amended as follows:

The principal authors of these proposed regulations are Shareen S. Pflanz and Stephen J. Toomey of the Office of Associate Chief Counsel (Income Tax and Accounting). However, other personnel from the IRS and the Treasury Department participated in the development of the regulations.

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