3552 Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 

1Section 411(a)(11)(A) generally provides that if 

the present value of a participant’s nonforfeitable 

accrued benefit exceeds $7,000 ($5,000 for 

distributions made on or before December 31, 

2023), then the benefit may not be distributed 

immediately without the participant’s consent. 

2Under section 411(a)(11)(B), the present value 

that is used to apply the rules of section 411(a)(11) 

is calculated using the rules of section 417(e)(3). 

AIRAC date State City Airport name FDC No. FDC date Procedure name 

2/22/24 ......... TX Denton .................... Denton Enterprise ................... 3/0199 12/12/23 RNAV (GPS) RWY 18L, Orig. 

2/22/24 ......... WA Moses Lake ............ Grant County Intl ..................... 3/1765 11/6/23 NDB RWY 32R, Amdt 17B. 

2/22/24 ......... KY Bardstown ............... Samuels Fld ............................ 3/2136 11/16/23 RNAV (GPS) RWY 3, Amdt 1A. 

2/22/24 ......... KY Bardstown ............... Samuels Fld ............................ 3/2138 11/16/23 RNAV (GPS) RWY 21, Amdt 1A. 

2/22/24 ......... KY Bardstown ............... Samuels Fld ............................ 3/2142 11/16/23 VOR RWY 3, Amdt 1. 

2/22/24 ......... OR Medford ................... Rogue Valley Intl—Medford .... 3/2772 11/6/23 VOR/DME RWY 14, Amdt 5B. 

2/22/24 ......... OR John Day ................ Grant County Rgnl/Ogilvie Fld 3/3840 11/6/23 RNAV (GPS) Z RWY 9, Orig–D. 

2/22/24 ......... ND Lakota ..................... Lakota Muni ............................. 3/5790 11/16/23 RNAV (GPS) RWY 33, Orig–A. 

2/22/24 ......... FL Orlando ................... Orlando Intl .............................. 3/6102 12/19/23 RNAV (GPS) RWY 17R, Orig–D. 

[FR Doc. 2024–00967 Filed 1–18–24; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD 9987] 

RIN 1545–BK95 

Update to Minimum Present Value 

Requirements for Defined Benefit Plan 

Distributions 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations. 

SUMMARY: This document sets forth final 

regulations providing guidance relating 

to the minimum present value 

requirements applicable to certain 

defined benefit pension plans. These 

regulations provide guidance on 

changes made by the Pension Protection 

Act of 2006 to the prescribed interest 

rate and mortality table and other 

guidance, including rules regarding the 

treatment of preretirement mortality 

discounts and Social Security level 

income options. These regulations affect 

participants, beneficiaries, sponsors, 

and administrators of defined benefit 

pension plans. 

DATES: 

Effective date: These regulations are 

effective on January 19, 2024. 

Applicability date: These regulations 

generally apply to distributions with 

annuity starting dates that occur on or 

after October 1, 2024. 

FOR FURTHER INFORMATION CONTACT: 

Diane S. Bloom or Linda S.F. Marshall 

at (202) 317–6700 (not a toll-free 

number). 

SUPPLEMENTARY INFORMATION: 

Background 

Section 401(a)(11) of the Internal 

Revenue Code (Code) provides rules 

that a defined benefit plan must satisfy 

with respect to a vested participant in 

order to be a qualified plan under 

section 401(a). Under those rules, except 

as provided under section 417: (1) if the 

participant survives to the annuity 

starting date, the accrued benefit 

payable to the participant must be 

provided in the form of a qualified joint 

and survivor annuity (QJSA); and (2) if 

the participant dies before the annuity 

starting date and has a surviving spouse, 

the plan must provide a qualified 

preretirement survivor annuity (QPSA) 

to the surviving spouse. 

Under section 417(e)(1), a plan may 

provide that the present value of a QJSA 

or a QPSA will be distributed 

immediately if that present value does 

not exceed the amount that may be 

distributed without the participant’s 

consent under section 411(a)(11).1

Under section 417(e)(2), if the present 

value of the QJSA or the QPSA exceeds 

that amount, then a plan may 

immediately distribute the present value 

of the QJSA or the QPSA only if the 

participant and the spouse of the 

participant (or, if the participant has 

died, the surviving spouse) consent in 

writing to the distribution. 

Section 417(e)(3)(A) provides that the 

present value of the QJSA or QPSA must 

not be less than the present value 

calculated by using the applicable 

mortality table and the applicable 

interest rate.2

Section 417(e)(3)(B), as amended by 

section 302 of the Pension Protection 

Act of 2006, Public Law 109–280, 120 

Stat. 780 (PPA ’06), provides that the 

term ‘‘applicable mortality table’’ means 

a mortality table, modified as 

appropriate by the Secretary, based on 

the mortality table specified for the plan 

year under section 430(h)(3)(A) of the 

Code (without regard to section 

430(h)(3)(C) or (D)). 

Section 417(e)(3)(C), as amended by 

section 302 of PPA ’06, provides that the 

term ‘‘applicable interest rate’’ means 

the adjusted first, second, and third 

segment rates applied under rules 

similar to the rules of section 

430(h)(2)(C) of the Code for the month 

before the date of the distribution or 

such other time as the Secretary may 

prescribe by regulations. However, for 

purposes of section 417(e)(3), these rates 

are determined without regard to the 

segment rate stabilization rules of 

section 430(h)(2)(C)(iv). In addition, 

under section 417(e)(3)(D), these rates 

are determined using the average yields 

for a month, rather than the 24-month 

average used under section 430(h)(2)(D). 

Section 411(a)(13), as added by 

section 701(b) of PPA ’06, provides that 

an ‘‘applicable defined benefit plan,’’ as 

defined by section 411(a)(13)(C) of the 

Code, is not treated as failing to meet 

the requirements of section 417(e) with 

respect to accrued benefits derived from 

employer contributions solely because 

the present value of a participant’s 

accrued benefit (or any portion thereof) 

may be, under the terms of the plan, 

equal to the amount expressed as the 

hypothetical account balance or as an 

accumulated percentage of such 

participant’s final average 

compensation. 

The Department of the Treasury 

(Treasury Department) and the IRS 

issued final regulations under section 

417 relating to the QJSA and QPSA 

requirements in 1988 (53 FR 31854, 

August 22, 1988), and amended those 

regulations in 1998 (63 FR 16898, April 

3, 1998), to reflect changes to section 

417(e)(3) enacted by the Retirement 

Protection Act of 1994, Subtitle F of 

Title VII of the Uruguay Round 

Agreements Act, Public Law 103–465, 

108 Stat. 4809 (RPA ’94). Section 

1.417(e)–1 was further amended in 2016 

(81 FR 62359, September 9, 2016) to 

permit defined benefit plans to bifurcate 

a benefit that is paid partly in the form 

of an annuity and partly in a more 

accelerated form and to apply the 

requirements of section 417(e)(3) only to 

the accelerated portion of the 

distribution. However, § 1.417(e)–1 was 

not updated at that time to reflect 

changes made by PPA ’06. 


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Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 3553 

3Notice 2008–85, 2008–2 CB 905, Notice 2013– 

49, 2013–32 IRB 127, Notice 2015–53, 2015–33 IRB 

190, Notice 2016–50, 2016–38 IRB 371, Notice 

2017–60, 2017–43 IRB 365, Notice 2018–2, 2018– 

2 IRB 281, Notice 2019–26, 2019–15 IRB 943, 

Notice 2019–67, 2019–52 IRB 1510, Notice 2020– 

85, 2020–51 IRB 1645, Notice 2022–22, 2022–20 

IRB 1057, and Notice 2023–73, 2023–45 IRB 1232, 

set forth the section 417(e)(3) applicable mortality 

tables for 2009 through 2024. 

Under § 1.417(e)–1(d)(1), a defined 

benefit plan generally must provide that 

the present value of any accrued benefit 

and the amount (subject to sections 

411(c)(3) and 415) of any distribution, 

including a single sum, may not be less 

than the amount calculated using the 

applicable interest rate and the 

applicable mortality table. In addition, 

under § 1.417(e)–1(d)(1), the present 

value of any optional form of benefit 

may not be less than the present value 

of the normal retirement benefit 

determined in accordance with the 

preceding sentence. 

Section 1.417(e)–1(d)(6) provides an 

exception from the minimum present 

value requirements of section 417(e) and 

§ 1.417(e)–1(d) for certain distributions. 

This exception applies to the amount of 

a distribution paid in the form of an 

annual benefit that either does not 

decrease during the life of the 

participant (or, in the case of a QPSA, 

the life of the participant’s spouse), or 

that decreases during the life of the 

participant merely because of (1) the 

death of the survivor annuitant (but 

only if the reduction is to a level not 

below 50 percent of the annual benefit 

payable before the death of the survivor 

annuitant), or (2) the cessation or 

reduction of Social Security 

supplements or qualified disability 

benefits. 

Section 1.401(a)–20 provides rules 

regarding the survivor annuity 

requirements of sections 401(a)(11) and 

417. Section 1.401(a)–20, Q&A–16, 

provides that, in the case of a married 

participant, the QJSA must be at least as 

valuable as any other optional form of 

benefit payable under the plan at the 

same time. Section 1.401(a)–20, Q&A– 

16 does not specify a particular actuarial 

basis for applying this requirement; 

therefore, this requirement may be 

satisfied using any set of reasonable 

actuarial assumptions. In addition, 

§ 1.401(a)–20, Q&A–16 provides that a 

plan does not fail to satisfy the at-leastas-valuable requirement merely because 

the amount payable under an optional 

form of benefit that is subject to the 

minimum present value requirement of 

section 417(e)(3) is calculated using the 

applicable interest rate (and, for periods 

when required, the applicable mortality 

table) under section 417(e)(3). 

Under section 401(a)(7), a plan is not 

a qualified plan unless the plan satisfies 

the requirements of section 411. Section 

411(d)(6)(A) provides that a plan is 

treated as not satisfying the 

requirements of section 411 if it is 

amended to reduce accrued benefits 

(subject to certain exceptions). For this 

purpose, section 411(d)(6)(B) provides 

that a plan amendment is treated as 

impermissibly reducing accrued 

benefits if it has the effect of eliminating 

or reducing an early retirement benefit 

or a retirement-type subsidy, or 

eliminating an optional form of benefit, 

with respect to benefits attributable to 

service before the amendment. 

However, the last sentence of section 

411(d)(6)(B) provides that the Secretary 

may by regulations provide that section 

411(d)(6)(B) does not apply to a plan 

amendment that eliminates an optional 

form of benefit (other than a plan 

amendment that has the effect of 

eliminating or reducing an early 

retirement benefit or a retirement-type 

subsidy). 

Notice 2007–81, 2007–2 CB 899, 

provides guidance on the applicable 

interest rate. Rev. Rul. 2007–67, 2007– 

2 CB 1047, provides guidance on the 

applicable mortality table 3 and the 

timing rules that apply to the 

determination of the applicable interest 

rate under section 417(e)(3)(C) and the 

applicable mortality table under section 

417(e)(3)(B). 

Sections 203(e), 204(g), and 205(g) of 

the Employee Retirement Income 

Security Act of 1974, Public Law 93– 

406, 88 Stat. 829, as amended (ERISA), 

provide rules that are parallel to Code 

sections 411(a)(11), 411(d)(6), and 

417(e), respectively. Under section 101 

of Reorganization Plan No. 4 of 1978, 5 

U.S.C. App., as amended, the Secretary 

of the Treasury has interpretive 

jurisdiction over the subject matter 

addressed in these regulations for 

purposes of ERISA, as well as the Code. 

Thus, these regulations apply for 

purposes of the Code and the 

corresponding provisions of ERISA. 

In West v. AK Steel Corporation 

Retirement Accumulation Pension Plan, 

484 F.3d 395, 411 (6th Cir. 2007), cert. 

denied 555 U.S. 1097 (2009), the court 

held that a preretirement mortality 

discount could not be used in the 

computation of the present value of a 

participant’s single-sum distribution 

under a cash balance plan if the death 

benefit under the plan was equal in 

value to the participant’s accrued 

benefit under the plan. The court found 

that, if a participant’s beneficiary is 

entitled to the participant’s entire 

accrued benefit upon the participant’s 

death before attainment of normal 

retirement age, the use of a mortality 

discount for the period before normal 

retirement age would result in a partial 

forfeiture of benefits in violation of the 

ERISA vesting rules that correspond to 

the rules of section 411(a). Id. See also 

Berger v. Xerox Retirement Income 

Guaranty Plan, 231 F.Supp.2d 804, 814 

(S.D. Ill. 2002), modified and affirmed, 

338 F.3d 755, 764 (7th Cir. 2003) 

(holding that use of a preretirement 

mortality discount was not warranted in 

determining participants’ normal 

retirement benefits payable under plan); 

Crosby v. Bowater, Inc. Ret. Plan, 212 

FRD. 350, 362 (W.D. Mich. 2002), rev’d 

on other grounds, 382 F.3d 587 (6th Cir. 

2004), cert. denied 544 U.S. 976 (2005) 

(holding that accrued benefits include 

not only retirement benefits themselves, 

but also death benefits which are 

directly related to the value of the 

retirement benefits); and McCutcheon v. 

Colgate-Palmolive Co., 62 F.4th 674 

(2nd Cir. 2023) (holding that a 

preretirement mortality factor may not 

be applied to calculate the value of a 

participant’s accrued benefit previously 

distributed from a cash-balance plan for 

purposes of determining a residual 

annuity). In Stewart v. AT&T Inc., 354 

Fed. App’x. 111, 118 (5th Cir. 2009), 

however, the court held that a 

preretirement mortality discount was 

appropriately applied to determine a 

single-sum distribution under a 

traditional defined benefit plan. The 

court distinguished AK Steel and Berger 

on the basis that the plans at issue in 

those cases did not provide for a 

forfeiture of the accrued benefit on the 

death of the participant before 

retirement, whereas the plan at issue in 

Stewart provided for such a forfeiture. 

Proposed regulations that would 

update the regulations under section 

417(e) and make certain clarifying 

changes were published in the Federal 

Register on November 25, 2016 (81 FR 

85190). Comments were received on the 

proposed regulations, and a public 

hearing was held on March 7, 2017. 

After consideration of the comments, 

the proposed regulations are adopted by 

this Treasury decision with certain 

changes described in the section of this 

preamble entitled ‘‘Summary of 

Comments and Explanation of 

Revisions.’’ 

Summary of Comments and 

Explanation of Revisions 

1. Overview 

These regulations amend the existing 

regulations under section 417(e) 

regarding the minimum present value 

requirements of section 417(e)(3) in 

several respects. Specifically, these 

regulations update § 1.417(e)–1 to reflect 


ddrumheller on DSK120RN23PROD with RULES1
3554 Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 

4Neither the proposed regulations nor these 

regulations address the applicability of a 

preretirement mortality adjustment in determining 

the actuarial equivalent of a past distribution for 

purposes of offsetting that actuarial equivalent 

against future distributions. But see McCutcheon, 

which concerned the application of a preretirement 

mortality adjustment to calculate the actuarial 

equivalent of previously distributed benefits for 

purposes of determining whether the plan’s 

calculation of a residual annuity resulted in the 

forfeiture of a participant’s accrued benefit. 

5These commenters noted that disregarding the 

probability of death in these circumstances 

generates the same present value as is generated by 

taking into account the probability of death and 

including the value of the death benefit in the 

single-sum distribution. 

changes to sections 411(a) and 417(e) 

made by PPA ’06 and to eliminate 

certain obsolete provisions. These 

regulations also set forth other updates 

and clarifying changes. 

2. Updates To Reflect Statutory Changes 

These regulations update the existing 

regulations to reflect the statutory 

changes made by PPA ’06, including the 

new interest rates and mortality tables 

set forth in section 417(e)(3) and the 

exception from the valuation rules for 

certain applicable defined benefit plans 

set forth in section 411(a)(13). These 

regulations clarify that, for purposes of 

section 417(e)(3), the interest rates that 

are published by the Commissioner are 

to be used without further adjustment. 

In addition, these regulations eliminate 

obsolete provisions relating to the 

transition from pre-1995 law to the 

interest rates and mortality assumptions 

under section 417(e)(3) as modified by 

RPA ’94. 

3. Treatment of Preretirement Mortality 

These regulations adopt the rules set 

forth in the proposed regulations 

relating to the treatment of 

preretirement mortality discounts in 

determining the minimum present value 

of accrued benefits. Those rules address 

the issue raised by AK Steel and Berger 

of whether a plan that provides a death 

benefit equal in value to the accrued 

benefit may apply a preretirement 

mortality discount for the probability of 

death when determining the amount of 

a single-sum distribution. 

Section 411(a) sets forth rules limiting 

the forfeiture of accrued benefits. Under 

section 411(a)(1), an employee’s rights 

in the accrued benefit derived from 

employee contributions must be 

nonforfeitable. In addition, an 

employee’s rights in the accrued benefit 

derived from employer contributions 

must become nonforfeitable at least as 

quickly as under one of the vesting 

schedules specified in section 411(a)(2). 

Section 411(a)(3)(A) provides that a 

right to an accrued benefit derived from 

employer contributions is not treated as 

forfeitable solely because the plan 

provides that it is not payable if the 

participant dies. 

Section 411(a)(7)(A)(i) defines a 

participant’s accrued benefit under a 

defined benefit plan as the employee’s 

accrued benefit determined under the 

plan and, except as provided in section 

411(c)(3), expressed in the form of an 

annual benefit commencing at normal 

retirement age. Section 1.411(a)–7(a)(1) 

provides that the term ‘‘accrued benefit’’ 

refers only to pension or retirement 

benefits. Consequently, accrued benefits 

do not include ancillary benefits not 

directly related to retirement benefits, 

such as incidental death benefits. 

A death benefit under a defined 

benefit plan that is payable if the 

participant dies before attaining normal 

retirement age and before benefits 

commence is not part of the 

participant’s accrued benefit within the 

meaning of section 411(a)(7) and, 

accordingly, the nonforfeiture rules of 

section 411(a) do not apply to this type 

of death benefit. This is the case even 

if the amount of the death benefit is the 

same as the amount the participant 

would have received if, instead of 

dying, the participant had separated 

from service and elected to receive an 

immediate distribution. Moreover, such 

an ancillary death benefit can be 

eliminated by plan amendment without 

violating the anti-cutback rule of section 

411(d)(6). 

Consistent with this analysis, section 

417(e) does not require ancillary death 

benefits (that is, a death benefit that is 

not part of the accrued benefit) to be 

taken into account in the calculation of 

the minimum present value of the 

accrued benefit. Accordingly, under the 

proposed regulations, the probability of 

death under the applicable mortality 

table generally is taken into account for 

purposes of determining the minimum 

amount of a lump sum distribution 

under the plan that is equal to the 

present value of the accrued benefit (or 

the optional form of benefit, if 

applicable) under section 417(e)(3), and 

that minimum amount is not required to 

include the present value of the death 

benefits provided under the plan (other 

than a death benefit that is part of the 

accrued benefit or part of the optional 

form of benefit for which present value 

is determined). Commenters generally 

supported this rule in the proposed 

regulations, and it is included in the 

final regulations at § 1.417(e)– 

1(d)(2)(ii)(A).4

Some commenters raised an issue 

regarding the effect of the rule on plan 

designs under which the probability of 

death is not taken into account in 

determining the amount of a single-sum 

distribution because the plan provides a 

death benefit equal in value to the 

present value of the accrued benefit.5

These commenters expressed concern 

that this type of plan design might 

violate the requirement of § 1.401(a)–20, 

Q&A–16, that, for a married participant, 

the QJSA must be at least as valuable as 

any other optional form of benefit 

payable under the plan at the same time, 

and would not be eligible for the 

exception that applies to an optional 

form of benefit that is calculated in 

accordance with the requirements of 

section 417(e)(3) (because disregarding 

the probability of death before normal 

retirement age in calculating the amount 

of a distribution in an optional form of 

benefit to which section 417(e)(3) 

applies would increase the present 

value of that distribution above the 

minimum present value required under 

section 417(e)(3)). 

The Treasury Department and the IRS 

did not intend for the rule requiring the 

probability of death to be taken into 

account for purposes of determining 

minimum present value to prohibit this 

plan design. Accordingly, these 

regulations expand eligibility for the 

exception to the rule under § 1.401(a)– 

20, Q&A–16, for certain optional forms 

of benefit. The existing exception under 

§ 1.401(a)–20, Q&A–16, applies to an 

optional form of benefit that is subject 

to the requirements of section 417(e)(3) 

and is calculated using the applicable 

interest rate and the applicable 

mortality table. Under the expanded 

eligibility for that exception provided 

for in § 1.417(e)–1(d)(2)(ii)(C)(1), the 

amount payable under an optional form 

of benefit is treated as calculated using 

the applicable interest rate and 

applicable mortality table under section 

417(e)(3) (and therefore is eligible for 

this exception) even if the amount 

payable is calculated taking into 

account both the probability of death 

before retirement and any death benefit 

under the plan. 

These regulations also adopt the rule 

under the proposed regulations under 

which, for purposes of determining the 

present value under section 417(e)(3) 

with respect to the portion of the 

accrued benefit derived from employee 

contributions (the employee-provided 

accrued benefit) that is computed in 

accordance with the rules of section 

411(c)(2), the probability of death before 

the assumed commencement date may 

not be taken into account. This rule is 

different from the rule that applies to 

the portion of the accrued benefit 


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Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 3555 

6See section 767 of RPA ’94. 

7The preamble to the proposed regulations 

requested comments on the issue of whether, in the 

case of a plan that provides a subsidized annuity 

payable upon early retirement and determines a 

single-sum distribution as the present value of the 

early retirement annuity, the present-value 

determination should be required to be calculated 

using the applicable interest rate and the applicable 

mortality table applied to the early retirement 

annuity. See Rybarczyk v. TRW, 235 F.3d 975, 983 

(6th Cir. 2000) (an early retirement single-sum 

distribution option that was determined based on 

the early retirement annuity was not required to be 

calculated using the section 417(e) factors, provided 

that the lump sum was at least as great as the 

present value of the deferred annuity determined 

using the section 417(e) factors); but see Costantino 

v. TRW, 13 F.3d 969, 979 (6th Cir. 1994) (benefit 

distributions must comply with the valuation rule 

of § 1.411(a)–11(a)(2)). A number of comments were 

received on this issue, many of which noted that 

the topic is also addressed in § 1.411(a)–11(a)(2). 

These comments will be considered in connection 

with the development of proposed regulations 

under section 411(a), rather than in these 

regulations under section 417(e). 

derived from employer contributions 

(the employer-provided accrued benefit) 

because an employee’s rights in the 

employee-provided accrued benefit are 

nonforfeitable under section 411(a)(1), 

and the exception for death under 

section 411(a)(3)(A) to the 

nonforfeitability of the employerprovided accrued benefit does not apply 

to the employee-provided accrued 

benefit. 

These regulations include an example 

to illustrate the application of the 

minimum present value requirements of 

section 417(e)(3) in the case of a singlesum distribution of a participant’s entire 

accrued benefit that consists of both the 

employee-provided accrued benefit and 

the employer-provided accrued benefit. 

Consistent with the rules in these 

regulations, the example illustrates that 

a single-sum distribution of the 

participant’s entire accrued benefit in 

this case must be no less than the sum 

of the minimum present value of the 

employee-provided accrued benefit, 

determined under section 417(e)(3) 

(applying the special rules set forth in 

the preceding paragraph), and the 

minimum present value of the 

employer-provided accrued benefit, 

determined under section 417(e)(3). 

Note that Rev. Rul. 89–60, 1989–1 CB 

113 (as corrected by Announcement 89– 

65, 1989–21 IRB 33), provides that it is 

sufficient for a single-sum distribution 

to equal the greater of: (1) the minimum 

present value of the employee-provided 

accrued benefit (determined using the 

actuarial assumptions specified in 

section 411(c)(2) and Rev. Rul. 76–47, 

1976–1 CB 109, taking into account the 

principle illustrated in Rev. Rul. 78– 

202, 1978–1 CB 124), and (2) the 

minimum present value of the 

participant’s entire accrued benefit 

using plan assumptions subject to the 

interest rate limitation of section 417(e). 

The determination under Rev. Rul. 89– 

60 of these minimum present values 

does not reflect the specification in 1994 

of a mortality assumption in section 

417(e)(3)(B).6 Several commenters noted 

that some plan sponsors, in the absence 

of updated guidance following the 1994 

amendment to section 417(e), have 

applied a preretirement mortality 

discount to both the employer-provided 

and employee-provided portions of the 

accrued benefit. These regulations 

modify and supersede the guidance in 

Rev. Rul. 89–60 to the extent the 

revenue ruling is inconsistent with 

these regulations. 

Several commenters raised concerns 

that the prohibition on taking 

preretirement mortality into account in 

determining the present value of the 

employee-provided accrued benefit 

would require a redetermination of a 

participant’s remaining accrued benefit 

if the participant had received a partial 

distribution in the past. As discussed in 

the ‘‘Applicability Dates’’ section of this 

preamble, these regulations do not 

change the results of calculations that 

were made in accordance with the rules 

that applied before the applicability 

date of these regulations. Therefore, the 

regulations would not require the 

redetermination of a participant’s 

remaining accrued benefit in such a 

case. 

One commenter observed that some 

employers would prefer not to use 

different factors for the employerprovided portion of a benefit and the 

employee-provided portion of a benefit 

(and accordingly would like to 

determine the full amount of a singlesum distribution using the factor 

required to be used for the employeeprovided portion of the benefit). A 

single-sum distribution determined in 

this manner would be greater than the 

minimum single-sum distribution that 

would satisfy section 417(e)(3) (and 

therefore would not be eligible for the 

exception to the requirement under 

§ 1.401(a)–20, Q&A–16). To address this 

concern, these regulations provide a 

second expansion of eligibility to use 

that exception. Under this rule (at 

§ 1.417(e)–1(d)(2)(ii)(C)(2)), the amount 

payable under an optional form of 

benefit is treated as calculated using the 

applicable interest rate and applicable 

mortality table under section 417(e)(3) 

(and therefore is eligible for the 

exception to § 1.401(a)–20, Q&A–16), 

even if, under the plan, the present 

value factor used for the employerprovided portion of the benefit is the 

present value factor that is required to 

be used for the employee-provided 

portion of the benefit (that is, a present 

value factor that does not take into 

account preretirement mortality). 

Some commenters raised concerns 

about the implications of the rule that 

the probability of death is taken into 

account in determining minimum 

present value for distributions 

commencing after normal retirement 

age. Section 1.417(e)–1(d)(1)(i)(A) 

provides that, for a distribution 

commencing after normal retirement 

age, the minimum present value under 

section 417(e)(3) is determined based on 

the immediate annuity rather than the 

accrued benefit payable as of normal 

retirement age. However, the extent to 

which the probability of death is taken 

into account in determining the annuity 

commencing after normal retirement age 

that is actuarially equivalent to the 

accrued benefit commencing at normal 

retirement age is an issue that arises 

under section 411(a), rather than under 

section 417(e)(3), and is expected to be 

addressed in future proposed 

regulations under section 411(a).7

4. Social Security Level Income Options 

The proposed regulations address the 

applicability of the minimum present 

value requirements of section 417(e)(3) 

to a Social Security level income option 

(SSLIO). An SSLIO is an optional form 

of benefit (within the meaning of section 

411(d)(6)(B) and § 1.411(d)–3(g)(6)(ii)) 

under which a participant’s accrued 

benefit is paid in the form of an annuity 

for the life of the participant, with 

additional temporary annuity payments 

in earlier years, before an assumed 

Social Security commencement age, to 

provide the participant with 

approximately level retirement income 

when the estimated Social Security 

payments are taken into account. 

As noted in the Background section of 

this preamble, § 1.417(e)–1(d)(6) 

provides that the minimum present 

value requirements of section 417(e)(3) 

do not apply to the amount of a 

distribution paid in the form of an 

annual benefit that does not decrease 

during the life of the participant, or that 

decreases during the life of the 

participant merely because of the death 

of the survivor annuitant or the 

cessation or reduction of Social Security 

supplements or qualified disability 

benefits. A Social Security supplement 

is defined in § 1.411(a)–7(c)(4) as a 

benefit for plan participants that both 

commences and terminates before the 

age when participants are entitled to 

old-age insurance benefits, unreduced 

on account of age, under title II of the 

Social Security Act (42 U.S.C. Chapter 

7, subchapter II), as amended, and does 


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3556 Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 

not exceed those old-age insurance 

benefits. A Social Security supplement 

(other than a QSUPP as defined in 

§ 1.401(a)(4)–12) is an ancillary benefit 

within the meaning of § 1.411(d)–3(g)(2) 

that is not a section 411(d)(6) protected 

benefit. 

Because the periodic payments under 

an SSLIO decrease during the lifetime of 

the participant and the decrease is not 

the result of the cessation of an ancillary 

Social Security supplement, § 1.417(e)– 

1(d)(6) does not provide an exception 

from the minimum present value 

requirements of section 417(e)(3) for this 

form of benefit. The proposed 

regulations included an example 

illustrating the application of the 

minimum present value requirements of 

section 417(e)(3) to an SSLIO. 

Commenters expressed a variety of 

views regarding this example. One 

commenter stated that it is reasonable to 

apply the minimum present value 

requirements to an SSLIO, while 

another commenter maintained that the 

minimum present value requirements 

should not apply to any optional forms 

of benefit other than a single-sum 

distribution. Some commenters 

suggested that the minimum present 

value requirements should apply only to 

the determination of the temporary 

annuity payments under an SSLIO and 

that the implicit bifurcation rule of 

§ 1.417(e)–1(d)(7)(ii)(B) should be 

expanded to permit bifurcation of that 

option into a temporary annuity portion 

and a remaining accrued benefit. 

The Treasury Department and the IRS 

believe that it is appropriate to apply 

the rules of section 417(e)(3) to an 

SSLIO because, when a participant’s 

lifetime benefit is paid in that form, a 

portion of those benefits (which may be 

a substantial portion of the participant’s 

lifetime benefits) is accelerated and paid 

over a short period of time (that is, until 

assumed Social Security retirement age). 

Nevertheless, the Treasury Department 

and the IRS agree with those 

commenters who suggested that it is 

appropriate to permit a plan to satisfy 

section 417(e)(3) by implicitly 

bifurcating the participant’s benefit 

payable in the form of an SSLIO into a 

temporary annuity portion and a 

remaining annuity benefit. As a result, 

the regulations include a new implicit 

bifurcation rule for an SSLIO at 

§ 1.417(e)–1(d)(7)(ii)(C). 

Under the new implicit bifurcation 

rule, the plan satisfies the minimum 

present value requirements of section 

417(e)(3) with respect to the temporary 

annuity portion of an SSLIO if the plan 

satisfies two minimum requirements 

with respect to the remaining annuity 

benefit. First, the remaining accrued 

benefit expressed in the normal form 

and payable at normal retirement age (or 

current age, if later) must be at least as 

great as it would be if an annuity 

payable in that form and commencing at 

that age that is actuarially equivalent to 

the temporary annuity (determined 

using the applicable section 417(e)(3) 

assumptions) were subtracted from the 

participant’s accrued benefit. Second, 

the remaining immediate annuity 

expressed in the normal form must be 

at least as great as it would be if an 

immediate annuity payable in that form 

that is actuarially equivalent to the 

temporary annuity (determined using 

the applicable section 417(e)(3) 

assumptions) were subtracted from the 

immediate annuity. The regulations 

include an example illustrating the 

application of the minimum present 

value requirements of section 417(e)(3) 

to an SSLIO and an example to illustrate 

the application of the new implicit 

bifurcation rule to an SSLIO. A plan 

amendment that provides for implicit 

bifurcation of an SSLIO in accordance 

with this new rule must comply with 

the requirements of section 411(d)(6). 

5. Section 411(d)(6) Relief for Changes 

in Lookback Months and Stability 

Periods for Mortality Table and Interest 

Rate 

The proposed regulations retained the 

rules providing relief under section 

411(d)(6) for a plan amendment that 

changes lookback months or stability 

periods for the applicable mortality 

table and applicable interest rate under 

section 417(e)(3). Under these rules, 

such a plan amendment does not violate 

section 411(d)(6) provided that, for a 

specified period, the participant is 

entitled to the greater of the benefits 

under the pre- and post-amendment 

timing rules. Commenters asked that 

this relief under section 411(d)(6) be 

expanded to apply to amendments that 

change the time for determining an 

interest rate or mortality table that is 

used for any purpose. Commenters 

observed that, given the requirement to 

use the more participant-favorable of the 

two sets of assumptions for a specified 

period, expanding this rule cannot be 

used to manipulate assumptions in the 

plan sponsor’s favor. 

In response, these regulations expand 

the rule previously set forth in the 

regulations under section 417(e) by 

adopting a comparable rule under 

section 411(d)(6), which is set forth in 

§ 1.411(d)–3(a), that applies to 

amendments that change the time for 

determining an interest rate or mortality 

table that is used for any purpose. 

Under these regulations, a defined 

benefit plan may be amended by an 

amendment that is adopted on or after 

January 19, 2024 to change the stability 

period from one stability period 

permitted under § 1.417(e)–1(d)(4)(ii) to 

a different permitted stability period, or 

to change the lookback month described 

in § 1.417(e)–1(d)(4)(iii) from one 

permitted lookback month to a different 

permitted lookback month (including an 

indirect change to the stability period or 

lookback month as a result of a change 

in plan year). Such an amendment may 

be made with respect to any plan 

provision under which an interest rate 

or mortality table is specified by 

reference to a stability period or a 

lookback month, provided that the 

amount of any distribution for which 

the annuity starting date occurs on or 

after the effective date of the 

amendment and before the end of the 

one year period commencing on the 

applicable amendment date for the 

amendment is determined using the 

more participant-favorable of the two 

sets of assumptions. 

For an amendment that changes the 

time for determining an interest rate or 

mortality table that is used for a purpose 

other than the minimum present value 

rules of section 417(e)(3), and that is 

adopted before January 19, 2024, 

whether an impermissible cutback 

under section 411(d)(6) has occurred is 

based on applicable law on the date the 

amendment is adopted. Thus, for 

example, if a plan amendment adopted 

before January 19, 2024 was permitted 

under § 1.417(e)–1(d)(10)(ii) as in effect 

before the amendments made by these 

regulations, no violation of section 

411(d)(6) will have occurred as a result 

of that plan amendment. 

Commenters requested that relief from 

the anti-cutback rules of section 

411(d)(6) be provided in additional 

situations. These situations involve 

plans that have been applying section 

417(e) to determine the amount of a 

benefit but could satisfy section 417(e) 

using a less generous benefit calculation 

than is permitted under these 

regulations, such as the application of a 

preretirement mortality discount or the 

implicit bifurcation of a benefit paid in 

the form of an SSLIO. Commenters 

requested section 411(d)(6) relief for 

such a plan so that the plan could be 

amended to apply the less generous 

benefit calculation to benefits already 

accrued. The final regulations do not 

provide the requested section 411(d)(6) 

relief but instead provide the relief 

under § 1.401(a)–20, Q&A–16 described 

earlier in this Summary of Comments 

and Explanation of Provisions. 


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Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 3557 

6. Applicability Dates 

The changes to the regulations under 

section 417(e)(3) apply to distributions 

with annuity starting dates occurring on 

or after October 1, 2024, except as 

otherwise provided. For earlier 

distributions, the rules of § 1.417(e)–1(d) 

as set forth in 26 CFR part 1, revised as 

of April 1, 2023, apply (taking into 

account any statutory changes and 

guidance of general applicability 

relating to those statutory changes), 

except that taxpayers may instead apply 

the rules of this Treasury decision. For 

example, if, before October 1, 2024, a 

participant received a payment equal to 

the present value of the participant’s 

employee-provided benefit determined 

in accordance with the valuation rules 

of section 417(e)(3) and § 1.417(e)–1(d) 

that applied at the time of the 

distribution, then the determination of 

the participant’s remaining accrued 

benefit is not affected by any differences 

between those rules and the rules in this 

Treasury decision (unless the taxpayer 

chooses to apply the applicable rules of 

this Treasury decision). 

The amendments to § 1.411(d)–3(a) 

apply to plan amendments adopted on 

or after January 19, 2024. 

Special Analyses 

1. Regulatory Planning and Review— 

Economic Analysis 

Pursuant to the Memorandum of 

Agreement, Review of Treasury 

Regulations under Executive Order 

12866 (June 9, 2023), tax regulatory 

actions issued by the IRS are not subject 

to the requirements of section 6 of 

Executive Order 12866, as amended. 

Therefore, a regulatory impact 

assessment is not required. 

2. Regulatory Flexibility Act 

It is hereby certified that these 

regulations will not have a significant 

economic impact on a substantial 

number of small entities pursuant to the 

Regulatory Flexibility Act (5 U.S.C. 

chapter 6). This certification is based on 

the fact that the regulations reflect the 

statutory changes to section 417(e) made 

by PPA ’06 and also provide additional 

flexibility in plan design. Specifically, 

the regulations reflect the statute in a 

manner that (i) is consistent with the 

statutory language, (ii) provides certain 

clarifications, and (iii) eases and 

facilitates plan administration. 

Although the regulations might affect a 

substantial number of individuals, the 

economic impact of the regulations on 

small businesses is not expected to be 

significant. For example, while the 

regulations clarify the application of the 

minimum present value requirements of 

section 417(e) to an SSLIO, most 

defined benefit plans sponsored by 

small employers do not include an 

SSLIO. Moreover, for those plans that 

do provide for SSLIOs, the regulations 

provide flexibility in the application of 

the minimum present value 

requirements by permitting the implicit 

bifurcation of the SSLIO into a 

temporary annuity (required to be 

determined using the minimum present 

value factors under section 417(e)(3)) 

and a life annuity (to which the 

minimum present value requirements 

do not apply). These regulations are not 

expected to result in any economically 

meaningful changes in behavior by 

small employers that sponsor defined 

benefit plans. 

For the reasons stated, a regulatory 

flexibility analysis under the Regulatory 

Flexibility Act is not required. Pursuant 

to section 7805(f), the notice of 

proposed rulemaking preceding these 

regulations was submitted to the Chief 

Counsel for Advocacy of the Small 

Business Administration for comment 

on their impact on small business, and 

no comments were received. 

3. Unfunded Mandates Reform Act 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 requires 

that agencies assess anticipated costs 

and benefits and take certain other 

actions before issuing a final rule that 

includes any Federal mandate that may 

result in expenditures in any one year 

by a State, local, or Tribal government, 

in the aggregate, or by the private sector, 

of $100 million in 1995 dollars, updated 

annually for inflation. These regulations 

do not include any Federal mandate that 

may result in expenditures by State, 

local, or Tribal governments, or by the 

private sector in excess of that 

threshold. 

4. Executive Order 13132 (Federalism) 

Executive Order 13132 (Federalism) 

prohibits an agency from publishing any 

rule that has federalism implications if 

the rule either imposes substantial, 

direct compliance costs on State and 

local governments, and is not required 

by statute, or preempts State law, unless 

the agency meets the consultation and 

funding requirements of section 6 of the 

Executive order. These regulations do 

not have federalism implications, 

impose substantial direct compliance 

costs on State and local governments, or 

preempt State law within the meaning 

of the Executive order. 

5. Congressional Review Act 

Pursuant to the Congressional Review 

Act (5 U.S.C. 801 et seq.), the Office of 

Information and Regulatory Affairs 

designated this rule as not a major rule, 

as defined by 5 U.S.C. 804(2). 

Statement of Availability of IRS 

Documents 

IRS Revenue Rulings, Revenue 

Procedures, and Notices cited in this 

document are published in the Internal 

Revenue Bulletin (or Cumulative 

Bulletin) and are available from the 

Superintendent of Documents, U.S. 

Government Printing Office, 

Washington, DC 20402, or by visiting 

the IRS website at www.irs.gov. 

Drafting Information 

The principal authors of these 

regulations are Diane S. Bloom and 

Linda S.F. Marshall, Office of Associate 

Chief Counsel (Employee Benefits, 

Exempt Organizations, and Employment 

Taxes). However, other personnel from 

the IRS and the Treasury Department 

participated in the development of these 

regulations. 

List of Subjects in 26 CFR Part 1 

Income taxes, Reporting and 

recordkeeping requirements. 

Adoption of Amendments to the 

Regulations 

Accordingly, the Treasury Department 

and the IRS amend 26 CFR part 1 as 

follows: 

PART 1—INCOME TAXES 

■ Paragraph 1. The authority citation 

for part 1 continues to read, in part, as 

follows: 

Authority: 26 U.S.C. 7805 * * * 

■ Par. 2. Section 1.411(d)–3 is amended 

by redesignating paragraph (a)(4) as 

paragraph (a)(5) and adding a new 

paragraph (a)(4) to read as follows: 

§ 1.411(d)–3 Section 411(d)(6) protected 

benefits. 

(a) * * * 

(4) Changes in lookback months and 

stability periods for mortality table and 

interest rate. Subject to the rules of this 

paragraph (a)(4), a defined benefit plan 

may be amended by an amendment that 

is adopted on or after January 19, 2024 

to change the stability period described 

in § 1.417(e)–1(d)(4)(ii) from one 

stability period to a different stability 

period or to change the lookback month 

described in § 1.417(e)–1(d)(4)(iii) from 

one lookback month to a different 

lookback month (including an indirect 

change to the stability period or 

lookback month as a result of a change 

in plan year). The amendments 

described in this paragraph (a)(4) may 

be made with respect to any plan 

provision under which an interest rate 


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3558 Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 

or mortality table is specified by 

reference to a stability period or a 

lookback month, provided that any 

distribution for which the annuity 

starting date occurs on or after the 

effective date of the amendment and 

before the end of the one-year period 

commencing on the applicable 

amendment date for the amendment is 

equal to the greater of— 

(i) The amount determined using the 

pre-amendment stability period and 

lookback month; and 

(ii) The amount determined using the 

post-amendment stability period and 

lookback month. 

* * * * * 

■ Par. 3. Section 1.417(e)–1 is amended 

by: 

■ a. Revising paragraphs (d)(1)(i) and 

(d)(2) through (4) and (6); 

■ b. Adding paragraphs (d)(7)(ii)(C) and 

(D); 

■ c. In paragraph (d)(7)(v), redesignating 

Examples 1 through 7 as paragraphs 

(d)(7)(v)(A) through (G), respectively; 

■ d. In newly designated paragraphs 

(d)(7)(v)(A) through (G), redesignating 

the paragraphs in the first column as the 

paragraphs in the second column: 

Newly redesignated paragraphs Further redesignated as paragraphs 

(d)(7)(v)(A)(i) through (iv) ......................................................................... (d)(7)(v)(A)(1) through (4). 

(d)(7)(v)(B)(i) through (v) .......................................................................... (d)(7)(v)(B)(1) through (5). 

(d)(7)(v)(C)(i) through (iv) ......................................................................... (d)(7)(v)(C)(1) through (4). 

(d)(7)(v)(D)(i) and (ii) ................................................................................ (d)(7)(v)(D)(1) and (2). 

(d)(7)(v)(E)(i) through (iv) ......................................................................... (d)(7)(v)(E)(1) through (4). 

(d)(7)(v)(F)(i) through (iv) ......................................................................... (d)(7)(v)(F)(1) through (4). 

(d)(7)(v)(G)(i) through (iii) ......................................................................... (d)(7)(v)(G)(1) through (3). 

■ e. In newly designated paragraph 

(d)(7)(v)(C)(1), removing the language 

‘‘Example 2 of this paragraph (d)(7)(v)’’ 

and adding the language ‘‘paragraph 

(d)(7)(v)(B)(1) of this section (Example 

2)’’ in its place; 

■ f. In newly designated paragraph 

(d)(7)(v)(E)(1), removing the language 

‘‘Example 4 of this paragraph (d)(7)(v)’’ 

and adding the language ‘‘paragraph 

(d)(7)(v)(D)(1) of this section (Example 

4)’’ in its place; 

■ g. In newly designated paragraph 

(d)(7)(v)(E)(2), removing the language 

‘‘Example 4 of this paragraph (d)(7)(v)’’ 

and adding the language ‘‘paragraph 

(d)(7)(v)(D)(1) of this section (Example 

4)’’ in its place; 

■ h. Adding paragraph (d)(7)(v)(H); 

■ i. Adding paragraph (d)(8)(vi); 

■ j. Revising paragraph (d)(9); and 

■ k. Removing paragraph (d)(10). 

The revisions and additions read as 

follows: 

§ 1.417(e)–1 Restrictions and valuations of 

distributions from plans subject to sections 

401(a)(11) and 417. 

* * * * * 

(d) * * * 

(1) * * * 

(i) Defined benefit plans—(A) In 

general. A defined benefit plan must 

provide that the present value of any 

accrued benefit and the amount (subject 

to sections 411(c)(3) and 415) of any 

distribution, including a single-sum 

distribution, must not be less than the 

amount calculated using the applicable 

mortality table described in paragraph 

(d)(2) of this section and the applicable 

interest rate described in paragraph 

(d)(3) of this section, as determined for 

the month described in paragraph (d)(4) 

of this section. In the case of an optional 

form of benefit payable before normal 

retirement age, the present value of the 

optional form determined in accordance 

with the preceding sentence may not be 

less than the present value of the 

accrued benefit payable at normal 

retirement age. In the case of an optional 

form of benefit payable on or after 

normal retirement age, the present value 

of the optional form determined in 

accordance with the first sentence of 

this paragraph (d)(1)(i)(A) may not be 

less than the present value of the 

immediate annuity (payable in the same 

form as the accrued benefit is 

expressed). The present value 

determined under this paragraph (d) 

also applies for purposes of determining 

whether consent for a distribution is 

required under paragraph (b) of this 

section. 

(B) Payment of a portion of a 

participant’s benefit. The rules of this 

paragraph (d)(1) apply with respect to a 

payment of only a portion of the 

accrued benefit in the same manner as 

these rules would apply to a 

distribution of the entire accrued 

benefit. See paragraph (d)(7) of this 

section for rules relating to such a 

bifurcation of a participant’s accrued 

benefit. 

(C) Special rules for applicable 

defined benefit plans. See section 

411(a)(13) and § 1.411(a)(13)–1 for an 

exception from the rules of section 

417(e)(3) and this paragraph (d) that 

applies to certain distributions from 

plans with lump sum-based benefit 

formulas. 

* * * * * 

(2) Applicable mortality table—(i) In 

general. The applicable mortality table 

for a calendar year is the mortality table 

that is prescribed by the Commissioner 

in guidance published in the Internal 

Revenue Bulletin. See § 601.601(d) of 

this chapter. This mortality table is to be 

based on the table specified under 

section 430(h)(3)(A), but without regard 

to section 430(h)(3)(C) or (D). 

(ii) Mortality discounts—(A) In 

general. Except as provided in 

paragraph (d)(2)(ii)(B) of this section, 

the probability of death under the 

applicable mortality table is taken into 

account for purposes of determining the 

present value under this paragraph (d) 

without regard to the death benefits 

provided under the plan (other than a 

death benefit that is part of the normal 

form of benefit or part of another 

optional form of benefit, as described in 

§ 1.411(d)–3(g)(6)(ii)(B), for which 

present value is determined). 

(B) Special rule for employeeprovided benefit. For purposes of 

determining the present value under 

this paragraph (d) with respect to the 

portion of the accrued benefit derived 

from employee contributions (that is 

determined in accordance with the rules 

of section 411(c)), the probability of 

death during the assumed deferral 

period, if any, is not taken into account. 

For purposes of the preceding sentence, 

the assumed deferral period is the 

period between the date of the present 

value determination and the assumed 

commencement date for the annuity 

attributable to the accrued benefit 

derived from employee contributions. 

(C) Exception from requirement that 

QJSA be most valuable form of benefit. 

An optional form of benefit that is 

subject to the minimum present value 

requirement of this section is not treated 

as failing the requirement under 

§ 1.401(a)–20, Q&A–16, that an optional 

form of benefit for a married participant 

may not be more valuable than the 

qualified joint and survivor annuity 

payable at the same time merely 

because, in applying the rules of this 


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Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 3559 

section in determining the amount of 

the optional form of benefit, the amount 

payable is calculated— 

(1) Taking into account both the 

probability of death before retirement 

and any death benefit under the plan, or 

(2) Using the present value factor for 

the employee-provided portion of the 

benefit determined under paragraph 

(d)(2)(ii)(B) of this section as the present 

value factor for the employer-provided 

portion of the benefit. 

(3) Applicable interest rate—(i) In 

general. The applicable interest rate for 

a month is determined using the first, 

second, and third segment rates for that 

month under section 430(h)(2)(C), as 

modified pursuant to section 

417(e)(3)(D) (and without regard to the 

segment rate stabilization rules of 

section 430(h)(2)(C)(iv)). These section 

417(e) segment rates are specified by the 

Commissioner in revenue rulings, 

notices, or other guidance published in 

the Internal Revenue Bulletin and are 

applied under rules similar to the rules 

under § 1.430(h)(2)–1(b). Thus, for 

example, in determining the present 

value of a straight life annuity, the first 

segment rate is applied with respect to 

payments expected to be made during 

the 5-year period beginning on the 

annuity starting date, the second 

segment rate is applied with respect to 

payments expected to be made during 

the 15-year period following the end of 

that 5-year period, and the third 

segment rate is applied with respect to 

payments expected to be made after the 

end of that 15-year period. The section 

417(e) segment rates that are published 

by the Commissioner are to be used for 

this purpose without further 

adjustment. 

(ii) Examples. The following 

examples illustrate the rules of 

paragraphs (d)(2) and (d)(3)(i) of this 

section: 

(A) Example 1—(1) Facts. Plan A is a 

non-contributory defined benefit plan 

with a calendar-year plan year. The 

normal retirement age is 65, and all 

participant elections are made with 

proper spousal consent. Plan A includes 

an optional form of benefit that provides 

a single-sum distribution equal to the 

present value of the participant’s 

accrued benefit. Plan A provides that 

the applicable interest rate for any 

distribution is determined using the 

segment rates as specified by the 

Commissioner for the month preceding 

the month containing the annuity 

starting date of the distribution. The 

applicable mortality table is the table 

specified by the Commissioner for the 

calendar year that contains the annuity 

starting date. 

(2) Analysis of minimum amount of 

single-sum distribution. Participant P 

retires in November 2024 at age 60 and 

elects (with spousal consent) to receive 

a single-sum distribution. P has an 

accrued benefit of $2,000 per month 

payable as a life annuity beginning at 

the plan’s normal retirement age of 65. 

The applicable mortality rates for 2024 

apply. For purposes of this paragraph 

(d)(3)(ii)(A) (Example 1), the section 

417(e) segment rates published by the 

Commissioner for October 2024 are 

assumed to be 3.00 percent, 4.00 

percent, and 5.00 percent for the first, 

second, and third segment rates, 

respectively. The present value factor 

for a participant, age 60, for a deferred 

annuity payable at age 65, calculated 

based on these interest rates and the 

applicable mortality table for 2024, is 

10.432. To satisfy the requirements of 

section 417(e)(3) and this paragraph (d), 

the single-sum distribution received by 

P cannot be less than $250,368 (that is, 

$2,000 × 12 × 10.432). 

(B) Example 2—(1) Facts. The facts 

are the same as in paragraph 

(d)(3)(ii)(A)(1) of this section (Example 

1), except that Plan A provides for 

mandatory employee contributions. 

Participant Q retires in November 2024 

at age 60 and elects (with spousal 

consent) to receive a single-sum 

distribution of Q’s entire accrued 

benefit. Q has an accrued benefit of 

$2,000 per month payable as a life 

annuity beginning at Plan A’s normal 

retirement age of 65, consisting of an 

accrued benefit derived from employee 

contributions determined in accordance 

with section 411(c)(2) (Q’s employeeprovided accrued benefit) of $500 per 

month and an accrued benefit derived 

from employer contributions (Q’s 

employer-provided accrued benefit) of 

$1,500 per month. 

(2) Analysis of minimum amount of 

the employee-provided portion of the 

single-sum distribution. Pursuant to 

paragraph (d)(2)(ii)(B) of this section, 

the single-sum distribution used to 

settle Q’s employee-provided accrued 

benefit may not be less than the present 

value of the employee-provided portion 

of Q’s accrued benefit determined using 

the applicable interest and mortality 

rates described in paragraphs (d)(2)(i) 

and (d)(3)(i) of this section, but without 

taking into account the probability of 

death during the assumed deferral 

period in accordance with paragraph 

(d)(2)(ii)(B) of this section. The present 

value factor for a participant, age 60, for 

a deferred annuity payable at age 65, 

calculated based on the interest and 

mortality rates specified in paragraph 

(d)(3)(ii)(A) of this section (Example 1), 

taking the probability of death only after 

age 65 into account, is 10.704. To satisfy 

the requirement of section 417(e)(3) and 

this paragraph (d), the single-sum 

distribution received by Q with respect 

to the employee-provided portion of the 

accrued benefit may not be less than 

$64,224 (that is, $500 × 12 × 10.704). 

(3) Analysis of minimum amount of 

the employer-provided portion of the 

single-sum distribution. The single-sum 

distribution made to settle Q’s 

employer-provided accrued benefit may 

not be less than the present value of that 

portion of Q’s accrued benefit 

determined using the applicable interest 

and mortality rates. However, for this 

purpose, Plan A is permitted to take into 

account the probability of death during 

the assumed deferral period in 

accordance with paragraph (d)(2)(ii)(A) 

of this section. The single-sum 

distribution received by Q with respect 

to the employer-provided portion of the 

accrued benefit may not be less than 

$187,776 (that is, $1,500 × 12 × 10.432). 

(4) Analysis of minimum amount of 

the total single-sum distribution. To 

satisfy the requirements of section 

417(e)(3) and this paragraph (d), the 

total single-sum distribution received by 

Q may not be less than the sum of the 

minimum single-sum distribution with 

respect to the employee-provided and 

employer-provided portions of the 

accrued benefit, or $252,000 ($64,224 + 

$187,776). 

(5) Analysis of minimum amount of 

partial single-sum distribution. If Q 

were to receive a partial single-sum 

distribution (that is, a single-sum 

distribution that is less than $252,000) 

with the balance payable as an annuity, 

then, in accordance with paragraph 

(d)(7)(iii)(D) of this section, the plan 

must specify the portion of the 

participant’s accrued benefit that is 

settled by that distribution of the partial 

single-sum distribution (unless the plan 

uses the same single-sum factor with 

respect to all portions of the accrued 

benefit). Because the present value 

factor for the employee-provided benefit 

cannot take into account the probability 

of death before age 65, the plan may use 

the same present value factor to 

determine the portion of the accrued 

benefit that is settled by the single-sum 

distribution that applies to both the 

employee-provided and the employerprovided portions of the accrued benefit 

only if the factor that is used does not 

take into account the probability of 

death before age 65. 

(4) Time for determining interest rate 

and mortality table—(i) Interest rate 

general rule. Except as provided in 

paragraphs (d)(4)(v) or (vi) of this 

section, the applicable interest rate to be 

used for a distribution is the applicable 


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3560 Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 

interest rate determined under 

paragraph (d)(3) of this section for the 

applicable lookback month. The 

applicable lookback month for a 

distribution is the lookback month (as 

described in paragraph (d)(4)(iv) of this 

section) for the stability period (as 

described in paragraph (d)(4)(iii) of this 

section) that contains the annuity 

starting date for the distribution. The 

time and method for determining the 

applicable interest rate for each 

participant’s distribution must be 

determined in a consistent manner that 

is applied uniformly to all participants 

in the plan. 

(ii) Mortality table general rule. The 

applicable mortality table to be used for 

a distribution is the mortality table that 

is described in paragraph (d)(2)(i) of this 

section for the calendar year during 

which the stability period containing 

the annuity starting date begins. 

(iii) Stability period. A plan must 

specify the period for which the 

applicable interest rate remains constant 

(the stability period). This stability 

period may be one calendar month, one 

plan quarter, one calendar quarter, one 

plan year, or one calendar year. This 

same stability period also applies to the 

applicable mortality table. 

(iv) Lookback month. A plan must 

specify the lookback month that is used 

to determine the applicable interest rate 

with respect to a stability period. The 

lookback month may be the first, 

second, third, fourth, or fifth full 

calendar month preceding the first day 

of the stability period. 

(v) Permitted average interest rate. A 

plan may apply the rules of paragraph 

(d)(4)(i) of this section by substituting a 

permitted average applicable interest 

rate with respect to the plan’s stability 

period for the applicable interest rate 

determined under paragraph (d)(3) of 

this section for the applicable lookback 

month with respect to the plan’s 

stability period. For this purpose, a 

permitted average applicable interest 

rate with respect to a stability period is 

the applicable interest rate that is 

computed using the average of the 

section 417(e) segment rates described 

in paragraph (d)(3) of this section for 

two or more consecutive months from 

among the first, second, third, fourth, 

and fifth calendar months preceding the 

first day of the stability period. For this 

paragraph (d)(4)(v) to apply, a plan must 

specify the manner in which the 

permitted average interest rate is 

computed. 

(vi) Additional determination dates. 

The Commissioner may prescribe, in 

guidance published in the Internal 

Revenue Bulletin, other times that a 

plan may provide for determining the 

applicable interest rate. See § 601.601(d) 

of this chapter. 

(vii) Example of determination of 

applicable interest rate—(A) Facts. The 

facts are the same as in paragraph 

(d)(3)(ii)(A)(1) of this section (Example 

1), except that Plan A provides that the 

applicable interest rate for any annuity 

starting date is determined using the 

segment rates specified by the 

Commissioner for the third calendar 

month preceding the beginning of the 

plan quarter that contains the annuity 

starting date. Plan A also provides that 

the applicable mortality table is the 

table specified by the Commissioner for 

the calendar year that contains the 

beginning of the quarterly stability 

period. 

(B) Analysis. The segment rates that 

apply for annuity starting dates during 

the period beginning October 1, 2024, 

and ending December 31, 2024, are the 

segment rates for July 2024. This plan 

design permits the applicable interest 

rate to be fixed for each plan quarter and 

for the applicable interest rate for all 

distributions made during each plan 

quarter to be determined before the 

beginning of the plan quarter. 

* * * * * 

(6) Exceptions—(i) In general. This 

paragraph (d) (other than the provisions 

relating to section 411(d)(6) 

requirements in paragraph (d)(9) of this 

section) does not apply to the amount of 

a distribution paid in the form of an 

annual benefit that— 

(A) Does not decrease during the life 

of the participant, or, in the case of a 

QPSA, the life of the participant’s 

spouse; or 

(B) Decreases during the life of the 

participant merely because of— 

(1) The death of the survivor 

annuitant (but only if the reduction is to 

a level not below 50 percent of the 

annual benefit payable before the death 

of the survivor annuitant); or 

(2) The cessation or reduction of a 

Social Security supplement or qualified 

disability benefit (as defined in section 

411(a)(9)). 

(ii) Example of Social Security level 

income option—(A) Facts. The facts are 

the same as in paragraph (d)(3)(ii)(A)(1) 

of this section (Example 1). Plan A also 

provides for an optional distribution in 

the form of a Social Security level 

income option that is actuarially 

equivalent to the straight life annuity 

payable at the same commencement 

date. Under this optional form, the 

participant receives a larger monthly 

payment until age 65, and a smaller 

monthly payment afterward, so that it is 

estimated that the participant will 

receive level monthly payments for life 

(taking into account the participant’s 

estimated Social Security benefit 

beginning at age 65). Based on the plan’s 

early retirement reduction factor of 0.65 

at age 60, Participant R’s reduced early 

retirement benefit payable as a straight 

life annuity benefit commencing at age 

60 is $1,300 per month (which is less 

than the early retirement benefit that is 

actuarially equivalent to the accrued 

benefit determined using the applicable 

interest and mortality rates under 

section 417(e)(3)). Participant R’s 

estimated Social Security benefit is 

$1,000 per month beginning at age 65. 

Plan A provides that actuarial 

equivalence is determined using a 6 

percent interest rate and the mortality 

table set forth in Revenue Ruling 2001– 

62, 2001–53 IRB 632. 

(B) Analysis of benefit calculation 

using plan factors. Using the plan’s 

terms for determining actuarial 

equivalence (an interest rate of 6 percent 

and the mortality table set forth in 

Revenue Ruling 2001–62), the present 

value factor for a participant, age 60, 

with lifetime benefits commencing at 

age 65 is 7.800, and the present value 

factor for a temporary annuity payable 

to that participant until age 65 is 4.278. 

The benefit payable to Participant R in 

the form of a Social Security level 

income option (with a decrease of 

$1,000 occurring at age 65) that is 

actuarially equivalent to the early 

retirement benefit of $1,300 is $1,945.80 

per month until age 65 and $945.80 per 

month thereafter. 

(C) Analysis of minimum present 

value. Because the benefit payable 

under the Social Security level income 

option decreases at age 65 and the 

decrease is not on account of the death 

of the participant or a beneficiary or the 

cessation or reduction of a Social 

Security supplement or a qualified 

disability benefit, the exception under 

this paragraph (d)(6) from the minimum 

present value requirements of section 

417(e)(3) does not apply to the benefits 

payable under the plan’s Social Security 

level income option. As illustrated in 

paragraph (d)(3)(ii)(A) of this section 

(Example 1), to satisfy the requirements 

of section 417(e)(3) and this paragraph 

(d), the minimum present value of a 

benefit payable to Participant R at age 

60 cannot be less than $250,368 (that is, 

$2,000 × 12 × 10.432). 

(D) Conclusion. Based on the 

applicable interest rate and applicable 

mortality table under section 417(e)(3) 

that are assumed in paragraph 

(d)(3)(ii)(A) of this section (Example 1), 

the present value factor for a 

participant, age 60, with lifetime 

benefits commencing at age 65 is 

10.432, and the present value factor for 


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Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 3561 

a temporary annuity payable until age 

65 is 4.604. The present value of the 

benefit payable to Participant R under 

the Social Security level income option 

is $225,901 ($1,945.80 × 4.604 × 12 + 

$945.80 × 10.432 × 12). Because this 

present value is less than the minimum 

present value of a benefit payable to 

Participant R at age 60 ($250,368), the 

plan would fail to satisfy the minimum 

present value requirement of section 

417(e)(3). However, see paragraph 

(d)(7)(ii)(C) of this section for a rule 

permitting a plan to provide for implicit 

bifurcation of a Social Security level 

income option. 

(7) * * * 

(ii) * * * 

(C) Bifurcation of Social Security level 

income option. A plan that provides for 

a Social Security level income option 

satisfies the requirements of this 

paragraph (d) with respect to the 

temporary annuity portion of the Social 

Security level income option if, under 

the terms of the plan— 

(1) The portion of the participant’s 

accrued benefit, expressed in the normal 

form of benefit under the plan and 

commencing at normal retirement age 

(or at the current date, if later), that is 

not paid in the form of the temporary 

annuity is no less than the excess, if 

any, of— 

(i) The participant’s total accrued 

benefit under the plan expressed in that 

form and commencing at that age; over 

(ii) The annuity payable in that form 

commencing at that age that is 

actuarially equivalent to that temporary 

annuity, determined using the 

applicable interest rate and the 

applicable mortality table; and 

(2) The portion of the participant’s 

immediate annuity (payable in the same 

form as the accrued benefit is expressed) 

that is not paid in the form of the 

temporary annuity is no less than the 

excess, if any, of— 

(i) The participant’s immediate 

annuity (payable in the same form as the 

accrued benefit is expressed); over 

(ii) The immediate annuity payable in 

that form that is actuarially equivalent 

to that temporary annuity, determined 

using the applicable interest rate and 

the applicable mortality table. 

(D) Social Security level income 

option. For purposes of paragraph 

(d)(7)(ii)(C) of this section, a Social 

Security level income option is an 

optional form of benefit under which a 

participant’s accrued benefit is paid in 

the form of an annuity for the life of the 

participant with additional temporary 

annuity payments that cease at the 

participant’s assumed Social Security 

commencement age and that do not 

exceed the participant’s estimated 

Social Security benefit at that age. For 

this purpose, a participant’s estimated 

Social Security benefit is the estimated 

amount of old-age insurance benefits for 

the participant under title II of the 

Social Security Act (as amended) and 

the assumed Social Security 

commencement age is an age that is not 

later than the age as of which the 

participant is entitled to those benefits 

without reduction on account of age. 

* * * * * 

(v) * * * 

(H) Example of bifurcation of Social 

Security level income option—(1) Facts. 

The facts are the same as in paragraph 

(d)(6)(ii)(A) of this section (Example of 

Social Security level income option), 

except that Plan A is amended to 

provide for implicit bifurcation of a 

distribution paid in the form of a Social 

Security level income option, as 

described in paragraph (d)(7)(ii)(C) of 

this section. Thus, under the plan 

amendment, a distribution in the form 

of a Social Security level income option 

is bifurcated into a temporary annuity 

portion that ceases at the participant’s 

assumed Social Security 

commencement age and a life annuity 

portion. 

(2) Analysis of bifurcation 

requirements. If the requirements of 

paragraph (d)(7)(ii)(C) of this section are 

satisfied, then the temporary annuity 

portion of the Social Security level 

income option satisfies the minimum 

present value rules of section 417(e)(3) 

and this paragraph (d). In order to 

satisfy paragraph (d)(7)(ii)(C) of this 

section, there are two requirements that 

must be satisfied. First, the portion of 

the participant’s accrued benefit that is 

not paid in the form of the temporary 

annuity must be no less than the excess 

of the participant’s total accrued benefit 

over the annuity that is actuarially 

equivalent to the temporary annuity 

(determined using the applicable 

interest and mortality rates under 

section 417(e)(3)), both expressed in the 

normal form of benefit commencing at 

normal retirement age (or at the current 

date, if later). Second, the portion of the 

participant’s immediate annuity that is 

not paid in the form of the temporary 

annuity must be no less than the excess 

of the participant’s total immediate 

annuity over the immediate annuity that 

is actuarially equivalent to the 

temporary annuity (determined using 

the applicable interest and mortality 

rates under section 417(e)(3)), both 

expressed in the form of benefit in 

which the accrued benefit is expressed 

but commencing at the current age. 

(3) Analysis of minimum portion of 

accrued benefit payable as lifetime 

annuity. A temporary annuity that is 

payable from age 60 to 65 in the amount 

of $1,000 per month is actuarially 

equivalent, determined using the 

applicable interest rate and applicable 

mortality table under section 417(e)(3), 

to a straight life annuity of $441.33 per 

month payable at normal retirement age. 

Therefore, under the amendment, the 

portion of Participant R’s accrued 

benefit that is not paid in the form of 

that temporary annuity must be no less 

than $1,558.67 per month payable as a 

straight life annuity at normal 

retirement age ($2,000¥$441.33). 

Because the portion of the accrued 

benefit that is not being paid in the form 

of the temporary annuity determined 

without regard to the amendment is 

$1,455.08 (the lifetime annuity of 

$945.80, divided by the early retirement 

factor of .65), the amendment increases 

that portion of the accrued benefit to 

$1,558.67, and the associated early 

retirement benefit commencing at age 60 

is $1,013.14 ($1,558.67 × 0.65). 

(4) Analysis of minimum portion of 

immediate benefit payable as lifetime 

annuity. A temporary annuity that is 

payable from age 60 to 65 in the amount 

of $1,000 per month is actuarially 

equivalent, determined using the 

applicable interest rate and applicable 

mortality table under section 417(e)(3), 

to a straight life annuity of $306.20 per 

month commencing at age 60. 

Therefore, under the amendment, the 

portion of the participant’s immediate 

benefit that is not paid in the form of 

that temporary annuity must be no less 

than $993.80 ($1,300¥$306.20). 

Because this minimum amount of 

immediate annuity is less than the 

otherwise calculated early retirement 

benefit at age 60 of $1,013.14, the 

amendment does not increase the 

immediate annuity above that amount. 

(5) Conclusion. Because the portion of 

the benefit under the Social Security 

level income option that is not paid in 

the form of a temporary annuity satisfies 

the requirements of paragraph 

(d)(7)(ii)(C) of this section, the plan is 

permitted under paragraph (d)(7)(iii)(A) 

of this section to treat the temporary 

annuity and the remaining portion of 

the benefit as separate distribution 

options for purposes of this paragraph 

(d). Under paragraph (d)(7)(ii)(C) of this 

section, the temporary annuity portion 

of the Social Security level income 

option is treated as satisfying the 

minimum present value requirements of 

section 417(e) and this paragraph (d). 

Because the lifetime annuity portion of 

the Social Security level income option 

is non-decreasing during the lifetime of 

the participant, that portion is described 

in paragraph (d)(6) of this section and is 


ddrumheller on DSK120RN23PROD with RULES1
3562 Federal Register / Vol. 89, No. 13 / Friday, January 19, 2024 / Rules and Regulations 

therefore excepted from the 

requirements of section 417(e)(3). Thus, 

under the amendment, the combined 

payments payable to Participant R 

under the Social Security level income 

option of $2,013.14 per month until age 

65 and $1,013.14 per month thereafter 

satisfy the requirements of section 

417(e)(3) and this paragraph (d). 

(8) * * * 

(vi) Applicability date for provisions 

reflecting PPA ’06 updates and other 

rules. Paragraphs (d)(1) through (4) of 

this section apply to distributions with 

annuity starting dates occurring on or 

after October 1, 2024. For earlier 

distributions, the rules of § 1.417(e)–1(d) 

as set forth in 26 CFR part 1, revised as 

of April 1, 2023, apply, except that 

taxpayers may instead apply the rules of 

paragraphs (d)(1) through (4) of this 

section. 

(9) Relationship with section 

411(d)(6). A plan amendment that 

changes the interest rate or the mortality 

assumptions used for the purposes 

described in paragraph (d)(1) of this 

section (including a plan amendment 

that changes the time for determining 

those assumptions) is generally subject 

to section 411(d)(6). However, for 

certain exceptions to the rule in the 

preceding sentence, see paragraph 

(d)(7)(iv) of this section (with respect to 

a plan amendment providing for 

bifurcation that was adopted before 

December 31, 2017), § 1.411(d)–3(a)(4) 

(regarding changes in lookback months 

and stability periods for mortality table 

and interest rate), § 1.411(d)–4, Q&A– 

2(b)(2)(v) (with respect to plan 

amendments relating to involuntary 

distributions), and section 1107(a)(2) of 

the Pension Protection Act of 2006, 

Public Law 109–280, 120 Stat. 780 (PPA 

’06) (with respect to certain plan 

amendments that were made pursuant 

to a change to the Internal Revenue 

Code made by PPA ’06 or pursuant to 

regulations issued thereunder). 

* * * * * 

Douglas W. O’Donnell, 

Deputy Commissioner for Services and 

Enforcement. 

Approved: December 27, 2023. 

Lily Batchelder, 

Assistant Secretary of the Treasury (Tax 

Policy). 

[FR Doc. 2024–00978 Filed 1–18–24; 8:45 am] 

BILLING CODE 4830–01–P 

DEPARTMENT OF THE INTERIOR 

Office of Surface Mining Reclamation 

and Enforcement 

30 CFR Part 950 

[SATS No. WY–050–FOR; Docket ID No. 

OSM–2021–0004; S1D1S SS08011000 

SX064A000 223S180110; S2D2S 

SS08011000 SX064A000 22XS501520] 

Wyoming Regulatory Program 

AGENCY: Office of Surface Mining 

Reclamation and Enforcement, Interior. 

ACTION: Final rule; approval with 

exceptions. 

SUMMARY: We, the Office of Surface 

Mining Reclamation and Enforcement 

(OSMRE), are approving with 

exceptions an amendment to the 

Wyoming regulatory program (Wyoming 

program) under the Surface Mining 

Control and Reclamation Act of 1977 

(SMCRA or the Act). Between 1978 and 

2007, the Wyoming Legislature enacted 

a number of revisions to the statutes 

governing coal exploration by drilling. 

On March 2, 2016, the Wyoming 

Environmental Quality Council 

approved a number of revisions to the 

rules governing coal exploration by 

drilling under the Wyoming program. 

The State submitted this proposal to 

OSMRE at its own initiative. 

DATES: Effective February 20, 2024. 

FOR FURTHER INFORMATION CONTACT: 

Jeffrey Fleischman; Director, Denver 

Field Division, Office of Surface Mining 

Reclamation and Enforcement, 100 East 

B Street, Room 4100; Casper, Wyoming 

82602. Telephone: (307) 261–6550. 

Email: jfleischman@osmre.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background on the Wyoming Regulatory 

Program 

II. Submission of the Amendment 

III. OSMRE’s Findings 

IV. Summary and Disposition of Comments 

V. OSMRE’s Decision 

VI. Procedural Determinations 

I. Background on the Wyoming 

Regulatory Program 

Subject to OSMRE’s oversight, Section 

503(a) of the Act permits a state to 

assume primacy for the regulation of 

surface coal mining and reclamation 

operations on non-federal and nonIndian lands within its borders by 

demonstrating that its program includes, 

among other things, state laws and 

regulations that govern surface coal 

mining and reclamation operations in 

accordance with the Act and consistent 

with the federal regulations. See 30 

U.S.C. 1253(a)(1) and (7). 

On the basis of these criteria, the 

Secretary of the Interior conditionally 

approved the Wyoming program on 

November 26, 1980. You can find 

background information on the 

Wyoming program including the 

Secretary’s findings, the disposition of 

comments, and conditions of approval 

in the November 26, 1980, Federal 

Register (45 FR 78637). You can also 

find later actions concerning Wyoming’s 

program and program amendments at 30 

CFR 950.10, 950.12, 950.15, 950.16, and 

950.20. 

II. Submission of the Amendment 

By letter dated June 14, 2021 (Docket 

ID No. OSM–2021–0004), Wyoming sent 

us an amendment to its program under 

SMCRA (30 U.S.C. 1201 et seq.). We 

found Wyoming’s proposed amendment 

administratively complete on July 13, 

2021. 

Between 1978 and 2007, the Wyoming 

Legislature enacted a number of 

revisions to the statutes governing coal 

exploration by drilling. The proposed 

statutory revisions reflect organizational 

changes at the Wyoming Land Quality 

Division (LQD), correct a typographical 

error, provide more detailed 

instructions for plugging and sealing 

drill holes, incorporate provisions for 

the awarding of attorney fees and other 

litigation costs, and include more 

detailed instructions for bond release. 

Additionally, on March 2, 2016, the 

Wyoming Environmental Quality 

Council approved a number of revisions 

to the rules governing coal exploration 

by drilling under the Wyoming program. 

The proposed amendment is a state 

initiative to update Chapter 14 of the 

LQD Coal Rules and Regulations, which 

was last revised in 1998. The revised 

rules were updated to include more 

detailed directions for plugging and 

sealing requirements for drill holes. The 

rules were also updated to include best 

management practices and standards 

adopted by the Wyoming State 

Engineer’s Office that conform with 

accepted best practices by the American 

Society for Testing and Materials and 

American Water Works Association, and 

Wyoming Department of Environmental 

Quality—Water Quality Division 

regulations. Other revisions include a 

list of acceptable grout materials, 

requirements to plug the entire hole, 

immediate capping of drill holes, and 

adding identification numbers to 

facilitate inspections. Additional 

formatting and organizational changes 

were made to Chapter 14. 

We announced receipt of the 

proposed amendment in the October 28, 

2021, Federal Register (86 FR 59674). In 

the same document, we opened a public 


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