This Revenue Procedure provides issuers of qualified mortgage bonds and mortgage credit certificates with (1) the nationwide average purchase price for residences located in the United States, and (2) the average area purchase price safe harbors for residences located in statistical areas in each state, the District of Columbia, Puerto Rico, the Northern Mariana Islands, American Samoa, the Virgin Islands, and Guam.

26 CFR 601.601: Rules and Regulations (Also: Part 1, §§ 25, 143, 6a.103A-1(b)(4), 6a.103A-2(f)(5))

Interest rates: underpayments and overpayments. The rates for interest determined under Section 6621 of the code for the calendar quarter beginning July 1, 2026, will be 7 percent for overpayments (6 percent in the case of a corporation), 7 percent for underpayments, and 9 percent for large corporate underpayments. The rate of interest paid on the portion of a corporate overpayment exceeding $10,000 will be 4.5 percent.

26 CFR 301.6621-1: Interest rate.

This document contains final regulations providing that amounts paid to a member of an Indian Tribe as remuneration for services performed in a fishing rights-related activity may be treated as compensation for purposes of applying the limits on qualified retirement plan benefits and contributions. These regulations affect participants who perform fishing rights-related activities and their beneficiaries, and sponsors and administrators of Tribal plans.

1.415(a)-1(g)(5); 1.415(c)-2(g)(9)

This notice publishes the inflation adjustment factor for the carbon oxide sequestration credit under § 45Q for calendar year 2026. The inflation adjustment factor is used to determine the amount of the credit allowable under § 45Q for taxpayers that make an election under § 45Q(b)(3) to have the dollar amounts applicable under § 45Q(a)(1) or (2) apply.

This notice publishes the reference price under § 45K(d)(2)(C) of the Internal Revenue Code for calendar year 2025. The reference price applies in determining the amount of the enhanced oil recovery credit under § 43, the marginal well production credit under § 45I, and the percentage depletion in case of oil and natural gas produced from marginal properties under § 613A.

This revenue procedure establishes a significant issue ruling program to allow taxpayers to request rulings on one or more issues that (1) are solely under the jurisdiction of the Associate Chief Counsel (Corporate), (2) are significant, and (3) involve the tax consequences or characterization of a transaction (or part of a transaction) that is described in § 332, 351, 355, 368, or 1036. Rev. Proc. 2026-1, 2026-1 I.R.B. 1, and Rev. Proc. 2026-3, 2026-1 I.R.B. 143, are modified and amplified.

26 CFR 601.201: Rulings and determination letters.

This revenue procedure provides indexing adjustments for the applicable dollar amounts under section 4980H(c)(1) and (b)(1) of the Internal Revenue Code. These indexed amounts are used to calculate the employer shared responsibility payments under section 4980H(a) and (b)(1), respectively.

26 CFR 601.601: Rules and Regulations. (Also Part I, §§ 4980H; 54.4980H)

DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 1

Treatment of Income from Indian Fishing Rights-Related Activity as Compensation

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final Regulations.

SUMMARY: This document contains final regulations providing that amounts paid to a member of an Indian Tribe as remuneration for services performed in a fishing rights-related activity may be treated as compensation for purposes of applying the limits on qualified retirement plan benefits and contributions. These regulations affect participants, beneficiaries, sponsors, and administrators of Tribal plans.

DATES: Effective Date: These regulations are effective on May 4, 2026.

Applicability Date: For date of applicability, see §1.415(a)-1(g)(5).

FOR FURTHER INFORMATION CONTACT: Jamie Dvoretzky at (202) 317-4102, or Pamela Kinard at (202) 317-6000 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Section 6621 of the Internal Revenue Code establishes the interest rates on overpayments and underpayments of tax. Under section 6621(a)(1), the overpayment rate is the sum of the federal short-term rate plus 3 percentage points (2 percentage points in the case of a corporation), except the rate for the portion of a corporate overpayment of tax exceeding $10,000 for a taxable period is the sum of the federal short-term rate plus 0.5 of a percentage point. Under section 6621(a)(2), the underpayment rate is the sum of the federal short-term rate plus 3 percentage points.

Section 6621(c) provides that for purposes of interest payable under section 6601 on any large corporate underpayment, the underpayment rate under section 6621(a)(2) is determined by substituting “5 percentage points” for “3 percentage points.” See section 6621(c) and section 301.6621-3 of the Regulations on Procedure and Administration for the definition of a large corporate underpayment and for the rules for determining the applicable date. Section 6621(c) and section 301.6621-3 are generally effective for periods after December 31, 1990.

Section 6621(b)(1) provides that the Secretary will determine the federal short-term rate for the first month in each calendar quarter. Section 6621(b)(2)(A) provides that the federal short-term rate determined under section 6621(b)(1) for any month applies during the first calendar quarter beginning after that month. Section 6621(b)(3) provides that the federal short-term rate for any month is the federal short-term rate determined during that month by the Secretary in accordance with section 1274(d), rounded to the nearest full percent (or, if a multiple of 1/2 of 1 percent, the rate is increased to the next highest full percent).

Notice 88-59, 1988-1 C.B. 546, announced that in determining the quarterly interest rates to be used for overpayments and underpayments of tax under section 6621, the Internal Revenue Service will use the federal short-term rate based on daily compounding because that rate is most consistent with section 6621 which, pursuant to section 6622, is subject to daily compounding.

The federal short-term rate determined in accordance with section 1274(d) during April 2026 is the rate published in Revenue Ruling 2026-9, 2026-19 IRB 897, to take effect beginning May 1, 2026. The federal short-term rate, rounded to the nearest full percent, based on daily compounding determined during the month of April 2026 is 4 percent. Accordingly, an overpayment rate of 7 percent (6 percent in the case of a corporation) and an underpayment rate of 7 percent are established for the calendar quarter beginning July 1, 2026. The overpayment rate for the portion of a corporate overpayment exceeding $10,000 for the calendar quarter beginning July 1, 2026, is 4.5 percent. The underpayment rate for large corporate underpayments for the calendar quarter beginning July 1, 2026, is 9 percent. These rates apply to amounts bearing interest during that calendar quarter.

Sections 6654(a)(1) and 6655(a)(1) provide that the underpayment rate established under section 6621 applies in determining the addition to tax under sections 6654 and 6655 for failure to pay estimated tax for any taxable year. Thus, the 7 percent rate also applies to estimated tax underpayments for the third calendar quarter beginning July 1, 2026. In addition, pursuant to section 6603(d)(4), the rate of interest on section 6603 deposits is 4 percent for the third calendar quarter in 2026.

Interest factors for daily compound interest for annual rates of 4.5 percent, 6 percent, 7 percent and 9 percent are published in Tables 14, 17, 19 and 23 of Rev. Proc. 95-17, 1995-1 C.B. 566, 569, 571, and 575.

Annual interest rates to be compounded daily pursuant to section 6622 that apply for prior periods are set forth in the tables accompanying this revenue ruling.

This notice publishes the inflation adjustment factor for the credit for carbon oxide sequestration under § 45Q of the Internal Revenue Code (§ 45Q credit) for calendar year 2026.¹ The inflation adjustment factor is used to determine the amount of the credit allowable under § 45Q for taxpayers that make an election under § 45Q(b)(3) to have the dollar amounts applicable under § 45Q(a)(1) or (2) apply.

Section 45Q was added to the Code by § 115 of the Energy Improvement and Extension Act of 2008, enacted as Division B of Pub. L. 110-343, 122 Stat. 3765, 3829 (October 3, 2008), to provide a credit for the sequestration of carbon dioxide. Section 45Q was amended by § 1131 of the American Recovery and Reinvestment Tax Act of 2009, enacted as Division B of Pub. L. 111-5, 123 Stat 115 (February 17, 2009), § 41119 of the Bipartisan Budget Act of 2018 (BBA), Pub. L. No. 115-123 (February 9, 2018), § 121 of the Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted as Division EE of the Consolidated Appropriations Act, 2021, Pub. L. 116-260, 134 Stat. 3051 (December 27, 2020), § 13104 of Pub. L. 117-169, 136 Stat. 1818 (August 16, 2022), commonly known as the Inflation Reduction Act (IRA), and § 70522 of Pub. L. 119-21, 139 Stat. 72 (July 4, 2025), commonly known as the One, Big, Beautiful Bill Act (OBBBA).

Section 45Q(a)(1) allows a credit of $20 per metric ton of qualified carbon oxide (i) captured by the taxpayer using carbon capture equipment which is originally placed in service at a qualified facility before the date of the enactment of the BBA, (ii) disposed of by the taxpayer in secure geological storage, and (iii) not used by the taxpayer as a tertiary injectant in a qualified enhanced oil or natural gas recovery project.

Section 45Q(a)(2) allows a credit of $10 per metric ton of qualified carbon oxide (i) captured by the taxpayer using carbon capture equipment which is originally placed in service at a qualified facility before the date of the enactment of the BBA, and (ii) either (I) used by the taxpayer as a tertiary injectant in a qualified enhanced oil or natural gas recovery project and disposed of by the taxpayer in secure geological storage or (II) utilized by the taxpayer in a manner described in § 45Q(f)(5).

Section 45Q(b)(3) provides that, for purposes of determining the carbon oxide sequestration credit under this section, a taxpayer may elect to have the dollar amounts applicable under § 45Q(a)(1) or (2) apply in lieu of the dollar amounts applicable under § 45Q(a)(3) or (4) for each metric ton of qualified carbon oxide which is captured by the taxpayer using carbon capture equipment which is originally placed in service at a qualified facility on or after the date of the enactment of the BBA.

Notice 2022-38 provided that 2022 was the final calendar year for which a taxpayer may claim a § 45Q credit under § 45Q(a)(1) and (2) for qualified carbon oxide that is captured by carbon capture equipment originally placed in service at a qualified facility before the date of enactment of the BBA. Therefore, the inflation adjustment amounts in section 3 of this notice only apply if a taxpayer elects under § 45Q(b)(3) to apply the dollar amounts applicable under § 45Q(a)(1) or (2) in lieu of the dollar amounts applicable under § 45Q(a)(3) or (4).

Under § 45Q(f)(7), for taxable years beginning in a calendar year after 2009, the dollar amounts contained in § 45Q(a)(1) and (2) must be adjusted for inflation by multiplying such dollar amount by the inflation adjustment factor for such calendar year determined under § 43(b)(3)(B), determined by substituting “2008” for “1990.”

Section 43(b)(3)(B) defines the term “inflation adjustment factor” as, 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. For purposes of § 45Q(f)(7), for the 2025 calendar year, the inflation adjustment factor is a fraction the numerator of which is the GNP implicit price deflator for 2025 (128.888) and the denominator of which is the GNP implicit price deflator for 2008 (88.046).

The inflation adjustment factor for calendar year 2026 is 1.4639. The § 45Q credit for calendar year 2026 is $29.28 per metric ton of qualified carbon oxide under § 45Q(a)(1) and $14.64 per metric ton of qualified carbon oxide under § 45Q(a)(2).

The principal author of this notice is the Office of Associate Chief Counsel (Energy, Credits, and Excise). For further information regarding this notice contact (202) 317-6853 (not a toll-free number).

¹ Unless otherwise specified, all “section” or “§” references are to sections of the Internal Revenue Code or the Temporary Regulations under Title II of the Omnibus Reconciliation Act of 1980 (26 CFR part 6a).

This notice publishes the reference price under § 45K(d)(2)(C) of the Internal Revenue Code for calendar year 2025.¹ The credit period for the nonconventional source production credit under § 45K ended on December 31, 2013, for facilities producing coke or coke gas (other than from petroleum-based products). However, the reference price continues to apply in determining the amount of the enhanced oil recovery credit under § 43, the marginal well production credit for qualified crude oil production under § 45I, and the applicable percentage under § 613A to be used in determining percentage depletion in the case of oil and natural gas produced from marginal properties.

Section 45K(d)(2)(C) provides that the term “reference price” means, with respect to a calendar year, the Secretary’s estimate of the annual average wellhead price per barrel for all domestic crude oil the price of which is not subject to regulation by the United States.

Section 43(a) provides that, for purposes of § 38, the enhanced oil recovery credit for any taxable year is an amount equal to 15 percent of the taxpayer’s qualified enhanced oil recovery costs for such taxable year.

Section 43(b)(1) provides that the amount of enhanced oil recovery credit for any taxable year shall be reduced by an amount which bears the same ratio to the amount of such credit (determined without regard to this paragraph) as - (A) the amount by which the reference price for the calendar year preceding the calendar year in which the taxable year begins exceeds $28, bears to (B) $6. Section 43(b)(2) provides that the term “reference price” means, with respect to any calendar year, the reference price determined for such calendar year under § 45K(d)(2)(C).

Section 45I(a) provides that, for purposes of § 38, the marginal well production credit for any taxable year is an amount equal to the product of the credit amount and the qualified crude oil production and the qualified natural gas production which is attributable to the taxpayer.

Section 45I(b)(1) provides that for crude oil production, the amount of the marginal well production credit is $3 per barrel of qualified crude oil production.

Section 45I(b)(2) provides that the $3 amount under § 45I(b)(1) shall be reduced (but not below zero) by an amount which bears the same ratio to such amount (determined without regard to this paragraph) as – (i) the excess (if any) of the applicable reference price over $15, bears to (ii) $3. The applicable reference price for a taxable year is the reference price of the calendar year preceding the calendar year in which the taxable year begins.

Section 45I(b)(2)(C) provides that for qualified crude oil production the term “reference price” means, with respect to any calendar year, the reference price determined under § 45K(d)(2)(C).

Section 613A(c)(6)(A) provides, in general, that the allowance for depletion under § 611 shall be computed in accordance with § 613 with respect to - (i) so much of the taxpayer’s average daily marginal production of domestic crude oil as does not exceed the taxpayer’s depletable oil quantity (determined without regard to paragraph (3)(A)(ii)), and (ii) so much of the taxpayer’s average daily marginal production of domestic natural gas as does not exceed the taxpayer’s depletable natural gas quantity (determined without regard to paragraph (3)(A)(ii)), and the applicable percentage shall be deemed to be specified in subsection (b) of § 613 for purposes of subsection (a) of that section.

Section 613A(c)(6)(C) provides that the term “applicable percentage” means the percentage (not greater than 25 percent) equal to the sum of - (i) 15 percent, plus (ii) 1 percentage point for each whole dollar by which $20 exceeds the reference price for crude oil for the calendar year preceding the calendar year in which the taxable year begins. For purposes of this paragraph, the term “reference price” means, with respect to any calendar year, the reference price determined for such calendar year under § 45K(d)(2)(C).

The reference price under § 45K(d)(2)(C) for calendar year 2025 is $63.40.

The principal author of this notice is the Office of Associate Chief Counsel (Energy, Credits, and Excise). For further information regarding this notice, contact (202) 317-6853 (not a toll-free number).

¹ Unless otherwise specified, all “section” references will be to the Internal Revenue Code, as amended, or the Income Tax Regulations.

This revenue procedure describes a program for letter rulings with respect to certain issues solely under the jurisdiction of the Associate Chief Counsel (Corporate). This program does not diminish the availability of letter rulings under existing programs.

This revenue procedure modifies and amplifies Rev. Proc. 2026-1, 2026-1 I.R.B. 1, which explains how the Internal Revenue Service (Service) provides advice to taxpayers on issues under the jurisdiction of the Associate Chief Counsel (Corporate). This revenue procedure also modifies and amplifies Rev. Proc. 2026-3, 2026-1 I.R.B. 143, which sets forth the areas of the Internal Revenue Code (Code)¹ under the jurisdiction of the Associate Chief Counsel (Corporate) relating to issues on which the Service will not issue letter rulings.

.01 Prior Ruling Policy. As described in this section 3.01, the Service has taken various positions over time on issuing letter rulings on only part of an integrated transaction.

(1) Rev. Proc. 2001-3. Rev. Proc. 2001-3, 2001-1 I.R.B. 111, modified by Ann. 2001-25, 2001-11 I.R.B. 895, provided that the Service would not rule on whether a transaction qualifies under § 332, 351, 368(a)(1)(A), (B), (C), (E) or (F), or 1036, and whether various consequences (such as nonrecognition and basis) result from the application of that section, unless the Service determined that there was a significant issue that must be resolved in order to decide those matters. In that case, the Service would rule on the entire transaction and not just on the significant issue. See section 3.01(29) of Rev. Proc. 2001-3.

(2) Rev. Proc. 2009-25. Rev. Proc. 2009-25, 2009-24 I.R.B. 1088, announced a pilot program for letter rulings on issues arising in the context of distributions to which § 355 applies (§ 355 distributions). Under this program, a taxpayer could request a letter ruling on part of a larger transaction or on a particular issue under a Code section that a transaction presented. In turn, the Service would issue a letter ruling on the particular issue raised in the letter ruling request and not on any other issue (including, in some cases, qualification of the distribution under § 355) or on any other aspect of the transaction.

(3) Rev. Proc. 2013-32. Rev. Proc. 2013-32, 2013-28 I.R.B. 55, provided that the Service no longer would rule on (i) whether a transaction qualifies for nonrecognition treatment under § 332, 351, 355, or 1036, (ii) whether a transaction constitutes a reorganization within the meaning of § 368, or (iii) the various tax consequences resulting from the application of those Code sections. Instead, the Service would rule only on significant issues presented in transactions described in those Code sections (significant issue rulings). Rev. Proc. 2013-32 further provided that (i) the Service would not issue a letter ruling with respect to an issue that is clearly and adequately addressed by statute, regulations, decision of a court, or authority published in the Internal Revenue Bulletin (comfort ruling), but that (ii) except with respect to issues under §§ 332, 351, 355, 368, and 1036 and the tax consequences resulting from the application of those Code sections, an Associate office may, in its discretion, issue a comfort ruling if the Associate office is otherwise ruling on another issue arising in the same transaction. Rev. Proc. 2013-32 also provided that the pilot program announced in Rev. Proc. 2009-25 was discontinued.

(4) Rev. Proc. 2017-52. Rev. Proc. 2017-52, 2017-41 I.R.B. 283, provides procedures for requesting letter rulings regarding § 355 distributions. Rev. Proc. 2017-52 established a pilot program to issue letter rulings that address the general Federal income tax consequences of a § 355 distribution. Rev. Proc. 2017-52 also provides procedures for requesting such rulings and clarifies procedures for requesting rulings on significant issues presented in those transactions. Rev. Proc. 2017-52 modified and superseded a number of prior revenue procedures, including superseding Rev. Proc. 2009-25 and Rev. Proc. 2013-32.

(5) Rev. Proc. 2024-1 and Rev. Proc. 2024-3. Rev. Proc. 2024-1, 2024-1 I.R.B. 1, and Rev. Proc. 2024-3, 2024-1 I.R.B. 143, removed issues under §§ 332, 351, 368, and 1036 from the list of areas in which letter rulings ordinarily would not be issued, permitted the issuance of comfort rulings relating to transactions under §§ 332, 351, 355, 368, 1036, and related operative provisions, and ended the practice of issuing significant issue rulings, including with respect to § 355 distributions. See sections 6.11 and 16 of Rev. Proc. 2024-1; section 1.02 of Rev. Proc. 2024-3.

.02 Current Ruling Policy. The Service ordinarily will not issue a letter ruling on only part of an integrated transaction. However, if part of an integrated transaction falls under an area of the Code, including those under the jurisdiction of the Associate Chief Counsel (Corporate), on which the Service will not issue letter rulings, the Service may issue a letter ruling on other parts of the transaction. Section 6.03 of Rev. Proc. 2026-1; section 4.02(2) of Rev. Proc. 2026-3. If it is impossible for the Service to determine the tax consequences of an integrated transaction without resolving an issue on which the Service will not issue rulings (no-rule issue) involving a part of the transaction or a related transaction, the taxpayer must state in its letter ruling request to the best of its knowledge and belief the tax consequences of the no-rule issue. The Service’s letter ruling will state that the Service did not consider, and no opinion is expressed upon, that issue. In appropriate cases, notwithstanding the taxpayer’s representation, the Service may decline to issue a letter ruling on the integrated transaction due to the relevance of the no-rule issue. Section 2.03 of Rev. Proc. 2026-3.

In addition, except with respect to issues under §§ 332, 351, 355, 368, 1036, and related operative provisions, the Service ordinarily will not issue comfort rulings, but the Service may in its discretion decide to issue a comfort ruling if the Service is otherwise issuing a letter ruling to the taxpayer on another issue arising in the same transaction. Section 6.11 of Rev. Proc. 2026-1; section 4.02(9) of Rev. Proc. 2026-3.

Furthermore, the Service will not issue letter rulings on questions that the Service determines, in its discretion, should not be answered in the interest of sound tax administration, including due to resource constraints. Section 3.02(10) of Rev. Proc. 2026-3.

A taxpayer requesting a letter ruling solely or primarily under the jurisdiction of the Associate Chief Counsel (Corporate) may request fast-track processing, but not expedited handling, of that letter ruling request. However, expedited handling, but not fast-track processing, may be available for letter ruling requests that include a closing agreement with respect to an issue or letter ruling requests for an extension of time for making an election or other relief. Section 7.02(4) of Rev. Proc. 2026-1; Rev. Proc. 2023-26, 2023-33 I.R.B. 486.

.03 Feedback Requesting Significant Issue Rulings. The Service has received numerous informal comments from taxpayers and practitioners regarding the time required to process letter ruling requests and the scope of those letter ruling requests. Taxpayers and practitioners have recommended that the Service reinstate the practice of issuing significant issue rulings. To use Service resources more efficiently, and to increase the availability and timeliness of letter rulings, this revenue procedure establishes a significant issue ruling program to allow taxpayers to request rulings on one or more issues that—

(1) Are solely under the jurisdiction of the Associate Chief Counsel (Corporate);

(2) Are significant (as defined in section 4.02 of this revenue procedure); and

(3) Involve the tax consequences or characterization of a transaction (or part of a transaction) that is described in § 332, 351, 355, 368, or 1036.

.01 Significant Issue Ruling Program. Under the significant issue ruling program described in this revenue procedure, taxpayers may request, and the Service may issue, a ruling on part of an integrated transaction described in § 332, 351, 355, 368, or 1036. In addition, taxpayers may request, and the Service may issue, a ruling on a particular legal issue under a section of the Code or the Income Tax Regulations with respect to a transaction (or part thereof) rather than a ruling that addresses all aspects of that section (or any other section) with respect to the transaction (or part thereof). For example, the Service may issue a letter ruling addressing significant issues presented by the application of § 355(e), 1.368-1(d), or 1.368-2(k), even though the ruling does not address overall qualification of the transaction under § 355 or 368.

In addition, the Service may rule on the tax consequences (such as nonrecognition and basis) resulting from integrated transactions described in § 332, 351, 355, 368, or 1036 to the extent that a significant issue is presented under related Code sections that address such tax consequences. For example, a § 351 exchange that does not present any significant issues under § 351 may present a significant issue regarding the application of § 358 to the transferor in the exchange.

This revenue procedure does not limit the number of significant issues with respect to a transaction that may be the subject of a single letter ruling. However, the Service reserves the right to rule on any other issue related to the transaction (including ruling adversely) if the Service believes that doing so would be in the interest of sound tax administration.

If the Service issues a letter ruling on a significant issue under Rev. Proc. 2026-1 as modified and amplified by this revenue procedure, the letter ruling will state that no opinion is expressed as to the overall tax consequences of the transactions described in the letter ruling or as to any issue or step not specifically addressed by the letter ruling.

.02 Significant Issue. A significant issue is a germane and specific issue of law, provided that a ruling on the issue would not be a comfort ruling or the conclusion in such a ruling otherwise would not be essentially free from doubt. An issue is germane if resolution of the issue is necessary to determine an element of the tax treatment of the transaction. An issue is specific if it is the narrowest articulation of the germane issue. A change of circumstances arising after a transaction ordinarily does not present a significant issue with respect to the transaction.

.01 In General. Letter ruling requests submitted under Rev. Proc. 2026-1 as modified and amplified by this revenue procedure must comply with the requirements set forth in Rev. Proc. 2026-1, including the requirements of section 6.03 of Rev. Proc. 2026-1, as modified and amplified by this revenue procedure. All pertinent no-rule policies described in Rev. Proc. 2026-3, as modified and amplified by this revenue procedure, will govern requests for letter rulings made pursuant to this revenue procedure. For example, see section 3.01(66) of Rev. Proc. 2026-3 (no-rule policy regarding business purpose under § 355).

In preparing a letter ruling request under Rev. Proc. 2026-1 as modified and amplified by this revenue procedure, taxpayers should continue to consult other applicable revenue procedures. For example, see Rev. Proc. 2025-30, 2025-42 I.R.B. 489 and Rev. Proc. 2017-52. However, the letter ruling request must include the information and representations described in such revenue procedures (as applicable) only to the extent that they relate to the significant issue. Further, when a taxpayer is requesting a ruling regarding a significant issue under a section of the Code or the Income Tax Regulations (for example, § 355(e)), the taxpayer must provide a representation (to the best knowledge and belief of the taxpayer) that the transaction would otherwise satisfy the requirements under that section (for example, § 355) or, as applicable, the relevant definitional section (for example, § 368).

.02 Rev. Proc. 2026-1. Rev. Proc. 2026-1 is modified and amplified as follows:

(1) Section 6.03. The following text is added after the first paragraph of section 6.03 of Rev. Proc. 2026-1:

Significant issue rulings. In addition, the Office of Associate Chief Counsel (Corporate) may issue a letter ruling on part of an integrated transaction without ruling on the larger transaction if the requested ruling would address one or more issues that: (1) are solely under the jurisdiction of the Associate Chief Counsel (Corporate); (2) are significant; and (3) involve the tax consequences or characterization of a transaction (or part of a transaction) that is described in § 332, 351, 355, 368, or 1036. The Service also may rule on a particular legal issue under a section of the Code or related regulations without ruling on other legal issues under that section of the Code or regulations if the issue meets the three conditions of the preceding sentence.

A significant issue is a germane and specific issue of law, provided that a ruling on the issue would not be a comfort ruling or the conclusion in such a ruling otherwise would not be essentially free from doubt. An issue is germane if resolution of the issue is necessary to determine an element of the tax treatment of the transaction. An issue is specific if it is the narrowest articulation of the germane issue. A change of circumstances arising after a transaction ordinarily does not present a significant issue with respect to the transaction.

Before preparing the letter ruling request under this section 6.03, a taxpayer should follow the procedures provided in section 10.07(1) of this revenue procedure for pre-submission conferences to discuss whether the Office of the Associate Chief Counsel (Corporate) will issue a letter ruling under this section 6.03. The Service reserves the right to rule on any other aspect of the transaction (including ruling adversely) if the Service believes doing so is in the interest of sound tax administration.

All requests for a ruling under this section 6.03 must contain the following:

(1) A narrative description of the transaction that puts the significant issue in context;

(2) A statement identifying the issue;

(3) An analysis of the relevant law that sets forth the authorities most closely related to the issue, explains why these authorities do not resolve the issue, and explains why the issue is significant;

(4) Applicable information and representations from relevant revenue procedures with respect to the significant issue (see Appendix F of this revenue procedure) and as otherwise may be required by the Office of Associate Chief Counsel (Corporate) depending on the facts and circumstances;

(5) If the taxpayer is requesting a ruling on the tax treatment of part of an integrated transaction, a representation regarding the relevant tax consequences of the integrated transaction (to the best knowledge and belief of the taxpayer), assuming that the Service issues the requested ruling;

(6) The precise ruling(s) being requested; and

(7) A statement that no rulings outside the jurisdiction of the Associate Chief Counsel (Corporate) are requested.

(2) Appendix C. The following text is added after question 8 of Appendix C of Rev. Proc. 2026-1:

See section 6.03.

.03 Rev. Proc. 2026-3. The following text is added after the first paragraph of section 4.02(2) of Rev. Proc. 2026-3:

Notwithstanding the prior paragraph, in connection with transactions described in § 332, 351, 355, 368, or 1036, the Office of Associate Chief Counsel (Corporate) may issue a letter ruling on part of an integrated transaction if and to the extent that the transaction presents a significant issue. See section 6.03 of Rev. Proc. 2026-1, 2026-1 I.R.B. 1, as modified and amplified by Rev. Proc. 2026-21, 2026-22 I.R.B. 1538.

Rev. Proc. 2026-1 and Rev. Proc. 2026-3 are modified and amplified.

The significant issue ruling program established by this revenue procedure applies to all letter ruling requests described in section 4.01 of this revenue procedure postmarked or, if not mailed, received by the Service after May 5, 2026.

The collections of information in this revenue procedure have been reviewed and approved by the Office of Management and Budget (OMB) in accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under control number 1545-1522.

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number.

The collections of information in this revenue procedure are in section 5. This information is required to determine whether a taxpayer qualifies for a letter ruling on part of an integrated transaction without the Service ruling on the larger transaction. The collections of information are required to obtain a benefit. The likely respondents are corporations seeking letter rulings. These procedures do not change the estimated burden already approved by OMB.

Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue tax law. Generally, tax returns and tax return information are confidential, as required by § 6103.

The principal author of this revenue procedure is Jonathan H. Blake of the Office of Associate Chief Counsel (Corporate). For further information regarding this revenue procedure, contact Mr. Blake at (202) 317-6847 (not a toll-free call).

¹ Unless otherwise specified, all “section” references will be to the Internal Revenue Code, as amended, or the Income Tax Regulations.

This revenue procedure provides indexing adjustments for the applicable dollar amounts under § 4980H(c)(1) and (b)(1) of the Internal Revenue Code. These indexed amounts are used to calculate the employer shared responsibility payments (ESRP) under § 4980H(a) and (b)(1), respectively.

Under § 4980H(c)(5), in the case of any calendar year after 2014, the applicable dollar amounts of $2,000 and $3,000 under § 4980H(c)(1) and (b)(1), respectively, are increased by an amount equal to the product of such dollar amount and the premium adjustment percentage (as defined in § 1302(c)(4) of the Patient Protection and Affordable Care Act¹) for the calendar year. If the amount of any increase is not a multiple of $10, such increase is rounded to the next lowest multiple of $10.

The Department of Health and Human Services (HHS) published the premium adjustment percentage for 2027 on January 29, 2026, using the most recent National Health Expenditure Accounts (NHEA) income and premium data that was available at the time of publication. For calculation of the 2027 benefit year payment parameters, HHS used the NHEA Projections 2024-2033, the data source that reflected the most recent projections available. Using the NHEA Projections 2024-2033, the premium adjustment percentage for 2027 is the percentage (if any) by which the most recent NHEA projection of per enrollee premiums for private health insurance (excluding Medigap and property and casualty insurance) for 2026 ($8,919) exceeds the most recent NHEA estimate of per enrollee premiums for private health insurance (excluding Medigap and property and casualty insurance) for 2013 ($4,715) carried out to ten significant digits. Using this formula, the applicable premium adjustment percentage is 1.8916224814.² For calendar year 2027, the adjusted $2,000 amount under § 4980H(c)(1) is $3,780 ($2,000 x 1.8916224814 = $3,783.2449628 rounded down to $3,780), and the adjusted $3,000 amount under § 4980H(b)(1) is $5,670 ($3,000 x 1.8916224814 = $5,674.8674442 rounded down to $5,670).

This revenue procedure is effective for taxable years and plan years beginning after December 31, 2026.

The principal author of this revenue procedure is the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). For further information regarding this revenue procedure, contact the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes) at (202) 317-5500 (not a toll-free call).

¹ Unless otherwise specified, all "section" references will be to the Internal Revenue Code, as amended, or the Income Tax Regulations.

¹ Pub. L. 111–148, 124 Stat. 119 (2010).

² See https://www.cms.gov/files/document/2027-papi-parameters-guidance-2026-01-29.pdf.

This revenue procedure provides issuers of qualified mortgage bonds, as defined in § 143(a) of the Internal Revenue Code¹, and issuers of mortgage credit certificates, as defined in § 25(c), with (1) the nationwide average purchase price for residences located in the United States, and (2) average area purchase price safe harbors for residences located in statistical areas in each state, the District of Columbia, Puerto Rico, the Northern Mariana Islands, American Samoa, the Virgin Islands, and Guam.

.01 Section 103(a) provides that, except as provided in § 103(b), gross income does not include interest on any State or local bond. Section 103(b)(1) provides that § 103(a) shall not apply to any private activity bond that is not a “qualified bond” within the meaning of § 141. Section 141(e) provides, in part, that the term “qualified bond” means any private activity bond if such bond (1) is a qualified mortgage bond under § 143, (2) meets the volume cap requirements under § 146, and (3) meets the applicable requirements under § 147.

.02 Section 143(a)(1) provides that the term “qualified mortgage bond” means a bond that is issued as part of a qualified mortgage issue. Section 143(a)(2)(A) provides that the term “qualified mortgage issue” means an issue of one or more bonds by a State or political subdivision thereof, but only if: (i) all proceeds of the issue (exclusive of issuance costs and a reasonably required reserve) are to be used to finance owner-occupied residences; (ii) the issue meets the requirements of subsections (c), (d), (e), (f), (g), (h), (i), and (m)(7) of § 143; (iii) the issue does not meet the private business tests of paragraphs (1) and (2) of § 141(b); and (iv) with respect to amounts received more than 10 years after the date of issuance, repayments of $250,000 or more of principal on mortgage financing provided by the issue are used by the close of the first semiannual period beginning after the date the prepayment (or complete repayment) is received to redeem bonds that are part of the issue.

.01 Average area purchase prices for single-family and two to four-family residences in MSAs, and for certain counties and county equivalents are set forth below. The safe harbor for “ALL OTHER AREAS” (found at the end of the table below) may be used for a statistical area that is not listed below.