Notice 2024-76

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 sin

1 Unless otherwise specified, all references to “section” or “§” are references to sections of the Internal Revenue Code.

2 Notice 2023-6, 2023-2 I.R.B. 328 and Notice 2024-6, 2024-2 I.R.B. 34 also address the SAF credits.

Bulletin No. 2024–45 1089 November 4, 2024

gle-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 September 2024 data is in Table 2024-9 at the end of this notice. The spot first, second, and third segment rates for the month of September 2024 are, respectively, 4.17, 4.76, and 5.25.

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 percent

ages of the corresponding 25-year average segment rates. Those percentages are 95% and 105% for plan years beginning in 2023, 2024 and 2025. 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, 2024 and 2025 were published in Notice 2022-40, 202240 I.R.B. 266, Notice 2023-66, 2023-40 I.R.B. 992, and Notice 2024-67, 2024-41 I.R.B. 726, respectively.

24-MONTH AVERAGE CORPORATE BOND SEGMENT RATES

The three 24-month average corporate bond segment rates applicable for October 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 October 2024 5.05 5.31 5.37

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 October 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 October 2024 5.05 5.31 5.74

2024 October 2024 5.05 5.31 5.59

2025 October 2024 5.05 5.31 5.50

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 September 2024 is 4.04 percent. The Service determined this rate as the average of the daily determinations of yield on the

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).

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30-year Treasury bond maturing in August 2024, the weighted average of the rates of 2054. For plan years beginning in October 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%

October 2024 3.67 3.30 to 3.85

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) provides guidelines for determining the min

imum present value segment rates. Pursuant to that section, the minimum present value segment rates determined for September 2024 are as follows:

Minimum Present Value Segment Rates Month First Segment Second Segment Third Segment September 2024 4.17 4.76 5.25

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 number).

Bulletin No. 2024–45 1091 November 4, 2024

Table 2024-9 Monthly Yield Curve for September 2024

Derived from September 2024 Data

Maturity Yield Maturity Yield Maturity Yield Maturity Yield Maturity Yield 0.5 4.66 20.5 5.12 40.5 5.26 60.5 5.33 80.5 5.37 1.0 4.43 21.0 5.13 41.0 5.26 61.0 5.34 81.0 5.37 1.5 4.23 21.5 5.14 41.5 5.27 61.5 5.34 81.5 5.37 2.0 4.10 22.0 5.14 42.0 5.27 62.0 5.34 82.0 5.37 2.5 4.03 22.5 5.15 42.5 5.27 62.5 5.34 82.5 5.37 3.0 4.00 23.0 5.15 43.0 5.27 63.0 5.34 83.0 5.37 3.5 4.01 23.5 5.15 43.5 5.28 63.5 5.34 83.5 5.37 4.0 4.04 24.0 5.16 44.0 5.28 64.0 5.34 84.0 5.38 4.5 4.08 24.5 5.16 44.5 5.28 64.5 5.34 84.5 5.38 5.0 4.13 25.0 5.16 45.0 5.28 65.0 5.34 85.0 5.38 5.5 4.18 25.5 5.16 45.5 5.29 65.5 5.35 85.5 5.38 6.0 4.24 26.0 5.16 46.0 5.29 66.0 5.35 86.0 5.38 6.5 4.29 26.5 5.17 46.5 5.29 66.5 5.35 86.5 5.38 7.0 4.34 27.0 5.17 47.0 5.29 67.0 5.35 87.0 5.38 7.5 4.40 27.5 5.17 47.5 5.29 67.5 5.35 87.5 5.38 8.0 4.45 28.0 5.17 48.0 5.30 68.0 5.35 88.0 5.38 8.5 4.50 28.5 5.17 48.5 5.30 68.5 5.35 88.5 5.38 9.0 4.55 29.0 5.18 49.0 5.30 69.0 5.35 89.0 5.38 9.5 4.59 29.5 5.18 49.5 5.30 69.5 5.35 89.5 5.38 10.0 4.63 30.0 5.19 50.0 5.30 70.0 5.35 90.0 5.38 10.5 4.67 30.5 5.19 50.5 5.31 70.5 5.36 90.5 5.38 11.0 4.71 31.0 5.20 51.0 5.31 71.0 5.36 91.0 5.38 11.5 4.75 31.5 5.20 51.5 5.31 71.5 5.36 91.5 5.38 12.0 4.78 32.0 5.20 52.0 5.31 72.0 5.36 92.0 5.38 12.5 4.82 32.5 5.21 52.5 5.31 72.5 5.36 92.5 5.39 13.0 4.85 33.0 5.21 53.0 5.31 73.0 5.36 93.0 5.39 13.5 4.88 33.5 5.22 53.5 5.32 73.5 5.36 93.5 5.39 14.0 4.90 34.0 5.22 54.0 5.32 74.0 5.36 94.0 5.39 14.5 4.93 34.5 5.22 54.5 5.32 74.5 5.36 94.5 5.39 15.0 4.95 35.0 5.23 55.0 5.32 75.0 5.36 95.0 5.39 15.5 4.98 35.5 5.23 55.5 5.32 75.5 5.36 95.5 5.39 16.0 5.00 36.0 5.23 56.0 5.32 76.0 5.36 96.0 5.39 16.5 5.02 36.5 5.24 56.5 5.32 76.5 5.36 96.5 5.39 17.0 5.03 37.0 5.24 57.0 5.33 77.0 5.37 97.0 5.39 17.5 5.05 37.5 5.24 57.5 5.33 77.5 5.37 97.5 5.39 18.0 5.07 38.0 5.25 58.0 5.33 78.0 5.37 98.0 5.39 18.5 5.08 38.5 5.25 58.5 5.33 78.5 5.37 98.5 5.39 19.0 5.09 39.0 5.25 59.0 5.33 79.0 5.37 99.0 5.39 19.5 5.10 39.5 5.26 59.5 5.33 79.5 5.37 99.5 5.39 20.0 5.11 40.0 5.26 60.0 5.33 80.0 5.37 100.0 5.39

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certain additional contributions in excess of minimum funding requirements and by increases in the plan’s minimum funding requirements attributable to the overpayment.

B. Section 414(aa) of the Code .

Section 301(b)(1) of the SECURE 2.0 Act added section 414(aa) to the Code. Section 414(aa)(1) provides that, as a general rule, a plan will not fail to be treated as described in clause (i), (ii), (iii) or (iv) of section 219(g)(5)(A) ⁷ and will not fail to be treated as satisfying the requirements of section 401(a) or 403 merely because the plan fails to obtain payment from a participant, beneficiary, employer, plan sponsor, fiduciary, or other party on account of any inadvertent benefit overpayment, or the plan sponsor amends the plan to increase past, or decrease future, benefit payments to affected participants and beneficiaries in order to adjust for prior inadvertent benefit overpayments.

Section 414(aa)(2) provides that section 414(aa)(1) will not fail to apply to a plan merely because, after discovering a benefit overpayment, the plan reduces future benefit payments to the correct amount provided for under the terms of the plan or seeks recovery from the person responsible for the overpayment.

Section 414(aa)(3) provides that nothing in section 414(aa) relieves an employer of any obligation imposed on it to make contributions to a plan to meet the minimum funding standards under sections 412 and 430 or to prevent or restore an impermissible forfeiture in accordance with section 411.

Section 414(aa)(4) provides that, notwithstanding section 414(aa)(1), a plan to which section 414(aa)(1) applies must observe any limitations imposed on it by section 401(a)(17) or 415. The plan may enforce these limitations using any

Guidance Under Sections 414(aa) and 402(c)(12) of the Internal Revenue Code with Respect to Inadvertent Benefit Overpayments