IRS guidance on rates that apply to adjust certain pension funding

The IRS today released an advance copy of Notice 2012-55 as guidance on the 25-year average segment rates that are applied to adjust the otherwise applicable 24-month average segment rates that are used to compute the funding target and other items under section 430 and ERISA section 303.

Section 430 specifies the minimum funding requirements that generally apply to single-employer defined benefit pension plans, and specifies interest rates that are used for purposes of calculating the minimum required contribution.

Notice 2012-55 reflects the changes made by the Moving Ahead for Progress in the 21st Century Act (enacted July 6, 2012).

Notice 2012-55 will appear in a future Internal Revenue Bulletin.

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