Rev. Rul. 2020-26

This revenue ruling provides various prescribed rates for federal income tax

purposes for December 2020 (the current month). Table 1 contains the shortterm, 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 appropri

ate 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, 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.

REV. RUL. 2020-26 TABLE 1 Applicable Federal Rates (AFR) for December 2020

Period for Compounding Annual Semiannual Quarterly Monthly Short-term AFR 0.15% 0.15% 0.15% 0.15% 110% AFR 0.17% 0.17% 0.17% 0.17% 120% AFR 0.18% 0.18% 0.18% 0.18% 130% AFR 0.20% 0.20% 0.20% 0.20% Mid-term AFR 0.48% 0.48% 0.48% 0.48% 110% AFR 0.53% 0.53% 0.53% 0.53% 120% AFR 0.58% 0.58% 0.58% 0.58% 130% AFR 0.62% 0.62% 0.62% 0.62% 150% AFR 0.72% 0.72% 0.72% 0.72% 175% AFR 0.84% 0.84% 0.84% 0.84% Long-term AFR 1.31% 1.31% 1.31% 1.31% 110% AFR 1.45% 1.44% 1.44% 1.44% 120% AFR 1.58% 1.57% 1.57% 1.56% 130% AFR 1.71% 1.70% 1.70% 1.69%

REV. RUL. 2020-26 TABLE 2 Adjusted AFR for December 2020

Period for Compounding Annual Semiannual Quarterly Monthly Short-term adjusted AFR 0.11% 0.11% 0.11% 0.11% Mid-term adjusted AFR 0.36% 0.36% 0.36% 0.36% Long-term adjusted AFR 0.99% 0.99% 0.99% 0.99%

December 7, 2020 1550 Bulletin No. 2020–50

REV. RUL. 2020-26 TABLE 3 Rates Under Section 382 for December 2020 Adjusted federal long-term rate for the current month .99% Long-term tax-exempt rate for ownership changes during the current month (the highest of .99% the adjusted federal long-term rates for the current month and the prior two months.)

REV. RUL. 2020-26 TABLE 4 Appropriate Percentages Under Section 42(b)(1) for December 2020 Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July 30, 2008, shall not be less than 9%. Appropriate percentage for the 70% present value low-income housing credit 7.20% Appropriate percentage for the 30% present value low-income housing credit 3.09%

REV. RUL. 2020-26 TABLE 5 Rate Under Section 7520 for December 2020 Applicable federal rate for determining the present value of an annuity, an interest for life or a term of years, or a remainder or reversionary interest

.6%

Section 42.—Low-Income Housing Credit

The applicable federal short-term, mid-term, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 280G.—Golden Parachute Payments

The applicable federal short-term, mid-term, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 382.—Limitation on Net Operating Loss Carryforwards and Certain Built-In Losses Following Ownership Change

The adjusted applicable federal long-term rate is set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 467.—Certain Payments for the Use of Property or Services

The applicable federal short-term, mid-term, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 468.—Special Rules for Mining and Solid Waste Reclamation and Closing Costs

The applicable federal short-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 482.—Allocation of Income and Deductions Among Taxpayers

The applicable federal short-term, mid-term, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 483.—Interest on Certain Deferred Payments

The applicable federal short-term, mid-term, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 1288.—Treatment of Original Issue Discount on Tax-Exempt Obligations

The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 7520.—Valuation Tables

The applicable federal mid-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Section 7872.—Treatment of Loans With Below- Market Interest Rates

The applicable federal short-term, mid-term, and long-term rates are set forth for the month of December 2020. See Rev. Rul. 2020-26, page 1550.

Bulletin No. 2020–50 1551 December 7, 2020

Deductibility of PPP Expenses