Notice 2024-53

This notice provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under § 417(e)(3), and the 24-month average segment rates under § 430(h) (2) of the Internal Revenue Code. In addition, this notice provides guidance as to the interest rate on 30-year Treasury securities under § 417(e)(3)(A)(ii) (II) as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate under § 431(c) (6)(E)(ii)(I).

YIELD CURVE AND SEGMENT RATES

Section 430 specifies the minimum funding requirements that apply to single-employer plans (except for CSEC plans under § 414(y)) pursuant to § 412. Section 430(h)(2) specifies the interest rates that must be used to determine a plan’s target normal cost and funding target. Under this provision, present value is generally determined using three 24-month average interest rates (“segment rates”), each of which applies to cash flows during specified periods. To the extent provided under § 430(h) (2)(C)(iv), these segment rates are adjusted by the applicable percentage of the 25-year average segment rates for the period ending September 30 of the year preceding the calendar year in which the plan year begins. ¹ However, an election may be made under § 430(h)(2)(D)(ii) to use the monthly yield curve in place of the segment rates.

Section 1.430(h)(2)-1(d) provides rules for determining the monthly corporate bond yield curve, ² and § 1.430(h) (2)-1(c) provides rules for determining the 24-month average corporate bond segment rates used to compute the target normal cost and the funding target. Consistent with the methodology specified in

§ 1.430(h)(2)-1(d), the monthly corporate bond yield curve derived from May 2024 data is in Table 2024-5 at the end of this notice. The spot first, second, and third segment rates for the month of May 2024 are, respectively, 5.18, 5.41, and 5.62.

The 24-month average segment rates determined under § 430(h)(2)(C)(i) through (iii) must be adjusted pursuant to § 430(h)(2)(C)(iv) to be within the applicable minimum and maximum percentages of the corresponding 25-year average segment rates. For this purpose, any 25-year average segment rate that is less than 5% is deemed to be 5%. The 25-year average segment rates for plan years beginning in 2023 and 2024 were published in Notice 2022-40, 2022-40 I.R.B. 266 and Notice 2023-66, 2023-40 I.R.B. 992, respectively. The applicable minimum and maximum percentages are 95% and 105% for plan years beginning in 2023 and 2024.

24-MONTH AVERAGE CORPORATE BOND SEGMENT RATES

The three 24-month average corporate bond segment rates applicable for June 2024 without adjustment for the 25-year average segment rate limits are as follows:

24-Month Average Segment Rates Without 25-Year Average Adjustment Applicable Month First Segment Second Segment Third Segment June 2024 4.93 5.27 5.26

The adjusted 24-month average segment rates set forth in the chart below reflect § 430(h)(2)(C)(iv) of the Code. The

24-month averages applicable for June 2024, adjusted to be within the applicable minimum and maximum percentages of

the corresponding 25-year average segment rates in accordance with § 430(h)(2) (C)(iv) of the Code, are as follows:

Adjusted 24-Month Average Segment Rates For Plan Years

Beginning In Applicable Month First Segment Second Segment Third Segment

2023 June 2024 4.93 5.27 5.74

2024 June 2024 4.93 5.27 5.59

1 Pursuant to § 433(h)(3)(A), the third segment rate determined under § 430(h)(2)(C) is used to determine the current liability of a CSEC plan (which is used to calculate the minimum amount of the full funding limitation under § 433(c)(7)(C)).

2 For months before February 2024, the monthly corporate bond yield curve was determined in accordance with Notice 2007-81, 2007-44 I.R.B. 899. Section 1.430(h)(2)-1(d) generally adopts the methodology for determining the monthly corporate bond yield curve under Notice 2007-81 but includes two enhancements to take into account subsequent changes in the bond market. Those enhancements are described in the preamble to TD 9986 (89 FR 2127).

July 1, 2024 4 Bulletin No. 2024–27

30-YEAR TREASURY SECURITIES INTEREST RATES

Section 431 specifies the minimum funding requirements that apply to multiemployer plans pursuant to § 412. Section 431(c)(6)(B) specifies a minimum amount for the full-funding limitation described in § 431(c)(6)(A), based on the plan’s current liability. Section 431(c) (6)(E)(ii)(I) provides that the interest rate used to calculate current liability for

this purpose must be no more than 5 percent above and no more than 10 percent below the weighted average of the rates of interest on 30-year Treasury securities during the four-year period ending on the last day before the beginning of the plan year. Notice 88-73, 1988-2 C.B. 383, provides guidelines for determining the weighted average interest rate. The rate of interest on 30-year Treasury securities for May 2024 is 4.62 percent. The Service determined this rate as the

average of the daily determinations of yield on the 30-year Treasury bond maturing in February 2054 determined each day through May 8, 2024 and the yield on the 30-year Treasury bond maturing in May 2054 determined each day for the balance of the month. For plan years beginning in June 2024, the weighted average of the rates of interest on 30-year Treasury securities and the permissible range of rates used to calculate current liability are as follows:

Treasury Weighted Average Rates For Plan Years Beginning In 30-Year Treasury Weighted Average Permissible Range 90% to 105%

June 2024 3.46 3.11 to 3.63

MINIMUM PRESENT VALUE SEGMENT RATES

In general, the applicable interest rates

under § 417(e)(3)(D) are segment rates computed without regard to a 24-month average. Section 1.417(e)-1(d)(3) and Notice 2007-81 provide guidelines for

determining the minimum present value segment rates. Pursuant to those guidelines, the minimum present value segment rates determined for May 2024 are as follows:

Minimum Present Value Segment Rates Month First Segment Second Segment Third Segment May 2024 5.18 5.41 5.62

DRAFTING INFORMATION

The principal author of this notice is Tom Morgan of the Office of Associ

ate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). However, other personnel from the IRS participated in the development

of this guidance. For further information regarding this notice, contact Mr. Morgan at 202-317-6700 or Tony Montanaro at 626-927-1475 (not toll-free numbers).

Bulletin No. 2024–27 5 July 1, 2024

Table 2024-5 Monthly Yield Curve for May 2024

Derived from April 2024 Data

Maturity Yield Maturity Yield Maturity Yield Maturity Yield Maturity Yield 0.5 5.55 20.5 5.61 40.5 5.62 60.5 5.65 80.5 5.66 1.0 5.42 21.0 5.61 41.0 5.62 61.0 5.65 81.0 5.66 1.5 5.30 21.5 5.61 41.5 5.63 61.5 5.65 81.5 5.66 2.0 5.20 22.0 5.61 42.0 5.63 62.0 5.65 82.0 5.66 2.5 5.13 22.5 5.61 42.5 5.63 62.5 5.65 82.5 5.66 3.0 5.07 23.0 5.61 43.0 5.63 63.0 5.65 83.0 5.66 3.5 5.04 23.5 5.61 43.5 5.63 63.5 5.65 83.5 5.66 4.0 5.02 24.0 5.60 44.0 5.63 64.0 5.65 84.0 5.66 4.5 5.01 24.5 5.60 44.5 5.63 64.5 5.65 84.5 5.66 5.0 5.02 25.0 5.60 45.0 5.63 65.0 5.65 85.0 5.66 5.5 5.03 25.5 5.60 45.5 5.63 65.5 5.65 85.5 5.66 6.0 5.06 26.0 5.60 46.0 5.63 66.0 5.65 86.0 5.66 6.5 5.09 26.5 5.60 46.5 5.63 66.5 5.65 86.5 5.66 7.0 5.12 27.0 5.60 47.0 5.63 67.0 5.65 87.0 5.66 7.5 5.16 27.5 5.60 47.5 5.63 67.5 5.65 87.5 5.66 8.0 5.19 28.0 5.60 48.0 5.63 68.0 5.65 88.0 5.66 8.5 5.23 28.5 5.60 48.5 5.64 68.5 5.65 88.5 5.66 9.0 5.27 29.0 5.60 49.0 5.64 69.0 5.65 89.0 5.66 9.5 5.30 29.5 5.60 49.5 5.64 69.5 5.65 89.5 5.66 10.0 5.33 30.0 5.60 50.0 5.64 70.0 5.65 90.0 5.66 10.5 5.36 30.5 5.60 50.5 5.64 70.5 5.65 90.5 5.66 11.0 5.39 31.0 5.60 51.0 5.64 71.0 5.65 91.0 5.66 11.5 5.42 31.5 5.60 51.5 5.64 71.5 5.65 91.5 5.66 12.0 5.44 32.0 5.61 52.0 5.64 72.0 5.65 92.0 5.66 12.5 5.47 32.5 5.61 52.5 5.64 72.5 5.65 92.5 5.66 13.0 5.49 33.0 5.61 53.0 5.64 73.0 5.66 93.0 5.66 13.5 5.50 33.5 5.61 53.5 5.64 73.5 5.66 93.5 5.66 14.0 5.52 34.0 5.61 54.0 5.64 74.0 5.66 94.0 5.66 14.5 5.53 34.5 5.61 54.5 5.64 74.5 5.66 94.5 5.66 15.0 5.55 35.0 5.61 55.0 5.64 75.0 5.66 95.0 5.66 15.5 5.56 35.5 5.61 55.5 5.64 75.5 5.66 95.5 5.66 16.0 5.57 36.0 5.61 56.0 5.64 76.0 5.66 96.0 5.66 16.5 5.57 36.5 5.62 56.5 5.64 76.5 5.66 96.5 5.66 17.0 5.58 37.0 5.62 57.0 5.64 77.0 5.66 97.0 5.66 17.5 5.59 37.5 5.62 57.5 5.64 77.5 5.66 97.5 5.66 18.0 5.59 38.0 5.62 58.0 5.64 78.0 5.66 98.0 5.67 18.5 5.60 38.5 5.62 58.5 5.65 78.5 5.66 98.5 5.67 19.0 5.60 39.0 5.62 59.0 5.65 79.0 5.66 99.0 5.67 19.5 5.60 39.5 5.62 59.5 5.65 79.5 5.66 99.5 5.67 20.0 5.61 40.0 5.62 60.0 5.65 80.0 5.66 100.0 5.67

July 1, 2024 6 Bulletin No. 2024–27

under §§ 25E, 30D, and 6213, as amended by §§ 13401, 13402, and 13301(f)(4), (g) (2), and 13403(b)(2), respectively, of the IRA.

.04 Revenue Procedures. (1) Rev. Proc. 2022-42, 2022-52 I.R.B. 565, in relevant part, established procedures for qualified manufacturers to enter into written agreements with the IRS in accordance with §§ 30D(d)(1)(C) and 30D(d)(3). Sections 4.01 and 4.02 of Rev. Proc. 2022-42 provided, respectively, information regarding the contents of the written agreement that a manufacturer must enter into with the IRS to become a qualified manufacturer, and the contents of the written reports submitted by the qualified manufacturer to the IRS.

(2) Rev. Proc. 2023-33, in relevant part, superseded sections 6.01 and 6.02 of Rev. Proc. 2022-42, and provided updated information on written agreements to be submitted by manufacturers to the IRS to become qualified manufacturers, as well as the method for qualified manufacturers to submit monthly reports, beginning January 1, 2024.

(3) Rev. Proc. 2023-38, in relevant part, established procedural rules for qualified manufacturers of new clean vehicles to comply with the reporting, certification, and attestation requirements regarding the excluded entity restriction, under which the IRS, with analytical assistance from the Department of Energy (DOE), will review compliance with the excluded entity restrictions of § 30D(d)(7). Section 5.01 of Rev. Proc. 2023-38 provided that, for calendar years beginning January 1, 2025, for vehicles to qualify for the § 30D credit, the qualified manufacturer must provide information to the IRS to establish a compliant-battery ledger for each year. The compliant-battery ledger for a calendar year tracks a qualified manufacturer’s anticipated supply of batteries that are FEOC-compliant for such a calendar year. See § 1.30D-2(b)(11) and (22) for definitions of the terms “compliant-battery ledger” and “FEOC-compliant.” Rev. Proc. 2023-38 also superseded certain provisions of Rev. Proc. 2022-42 and Rev. Proc. 2023-33 not relevant to this revenue procedure.

26 CFR 1.30D-3(d), 26 CFR 1.30D-6(d)(2)(ii). Sub- mission of Information by Qualified Manufacturers of New Clean Vehicles and Dealers and Sellers of New Clean Vehicles and Previously-Owned Clean Vehicles. (Also Part I, §§ 25E and 30D.)