46388 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 

1Section 302 of the Employee Retirement Income 

Security Act of 1974, Public Law 93–406, as 

amended (ERISA), sets forth funding rules that are 

parallel to those in section 412 of the Code, and 

section 303 of ERISA sets forth additional funding 

rules for defined benefit plans (other than 

multiemployer plans) that are parallel to those in 

section 430 of the Code. Under section 101 of 

Reorganization Plan No. 4 of 1978 (43 FR 47713) 

and section 302 of ERISA, 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 

Treasury regulations issued under section 430 of 

the Code also apply for purposes of section 303 of 

ERISA. 

2The standards prescribed for developing these 

mortality tables are the same as the standards that 

are prescribed for developing mortality tables for 

multiemployer plans under section 

431(c)(6)(D)(iv)(II) (which are used to determine 

current liability as part of the calculation of the 

minimum full funding limitation under section 

431(c)(6)(B)). These standards also apply for 

AIRAC date State City Airport FDC No. FDC date Subject 

12–Oct–17 .... MT Libby ........................ Libby ........................ 7/6820 8/22/17 This NOTAM, published in TL 17–21, is 

hereby rescinded in its entirety. 

12–Oct–17 .... AK Central ..................... Central ..................... 7/0453 8/29/17 RNAV (GPS) RWY 8, Orig-A. 

12–Oct–17 .... AK Central ..................... Central ..................... 7/0454 8/29/17 RNAV (GPS) RWY 26, Orig-A. 

12–Oct–17 .... AK Homer ...................... Homer ...................... 7/0473 8/29/17 RNAV (GPS) Y RWY 4, Amdt 1B. 

12–Oct–17 .... AK Homer ...................... Homer ...................... 7/0475 8/29/17 LOC/DME RWY 4, Amdt 10A. 

12–Oct–17 .... AK Koliganek ................. Koliganek ................. 7/0477 8/29/17 RNAV (GPS) RWY 27, Amdt 1. 

12–Oct–17 .... AK Kaltag ...................... Kaltag ...................... 7/0478 8/29/17 RNAV (GPS) RWY 3, Orig-C. 

12–Oct–17 .... AK Mountain Village ...... Mountain Village ...... 7/0479 8/29/17 RNAV (GPS) RWY 20, Amdt 1B. 

12–Oct–17 .... AK Pilot Point ................ Pilot Point ................ 7/0480 8/29/17 RNAV (GPS) RWY 25, Orig-B. 

12–Oct–17 .... AK Pilot Point ................ Pilot Point ................ 7/0482 8/29/17 RNAV (GPS) RWY 7, Orig-B. 

12–Oct–17 .... AK Ruby ........................ Ruby ........................ 7/0492 8/29/17 RNAV (GPS) RWY 3, Amdt 1A. 

12–Oct–17 .... CA Bishop ...................... Bishop ...................... 7/0499 8/29/17 RNAV (GPS) Y RWY 12, Orig-B. 

12–Oct–17 .... CA Bishop ...................... Bishop ...................... 7/0500 8/29/17 RNAV (GPS) Z RWY 12, Orig-C. 

12–Oct–17 .... CA Davis ........................ University ................. 7/0503 8/29/17 RNAV (GPS) RWY 17, Orig-B. 

12–Oct–17 .... CA Bakersfield ............... Bakersfield Muni ...... 7/0506 8/29/17 RNAV (GPS) RWY 34, Orig-B. 

12–Oct–17 .... CA San Diego/El Cajon Gillespie Field .......... 7/0509 8/29/17 RNAV (GPS) RWY 17, Amdt 2D. 

12–Oct–17 .... CO Meeker ..................... Meeker Coulter Fld .. 7/0513 8/29/17 RNAV (GPS) RWY 3, Amdt 3B. 

12–Oct–17 .... OR Bend ........................ Bend Muni ............... 7/0515 8/29/17 RNAV (GPS) Y RWY 16, Amdt 2A. 

12–Oct–17 .... OR Mc Minnville ............. Mc Minnville Muni .... 7/0517 8/29/17 RNAV (GPS) RWY 4, Orig-A. 

12–Oct–17 .... OR Tillamook ................. Tillamook ................. 7/0519 8/29/17 RNAV (GPS) RWY 13, Orig-B. 

12–Oct–17 .... OK Goldsby ................... David Jay Perry ....... 7/1922 8/14/17 VOR/DME RWY 31, Amdt 2. 

12–Oct–17 .... GA Dalton ...................... Dalton Muni ............. 7/3954 8/22/17 ILS OR LOC RWY 14, Amdt 1. 

12–Oct–17 .... MT Libby ........................ Libby ........................ 7/3967 8/22/17 GPS–A, Orig-C. 

12–Oct–17 .... WA Seattle ..................... Boeing Field/King 

County Intl.

7/4152 8/22/17 ILS OR LOC RWY 31L, Amdt 1B. 

[FR Doc. 2017–21222 Filed 10–4–17; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD9826] 

RIN 1545–BM71 

Mortality Tables for Determining 

Present Value Under Defined Benefit 

Pension Plans 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations. 

SUMMARY: This document contains final 

regulations prescribing mortality tables 

to be used by most defined benefit 

pension plans. The tables specify the 

probability of survival year-by-year for 

an individual based on age, gender, and 

other factors. This information is used 

(together with other actuarial 

assumptions) to calculate the present 

value of a stream of expected future 

benefit payments for purposes of 

determining the minimum funding 

requirements for a defined benefit plan. 

These mortality tables are also relevant 

in determining the minimum required 

amount of a lump-sum distribution from 

such a plan. In addition, this document 

contains final regulations updating the 

requirements that a plan sponsor must 

meet to obtain IRS approval to use 

mortality tables specific to the plan for 

minimum funding purposes (instead of 

using the generally applicable mortality 

tables). These regulations affect 

participants in, beneficiaries of, 

employers maintaining, and 

administrators of certain retirement 

plans. 

DATES:

Effective date: These regulations are 

effective on October 5, 2017. 

Applicability date: These regulations 

apply to plan years beginning on or after 

January 1, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Concerning the regulations, Arslan 

Malik at (202) 317–6700; concerning the 

construction of the base mortality tables 

and the static mortality tables for 2018, 

Michael Spaid at (206) 946–3480. 

SUPPLEMENTARY INFORMATION: 

Background 

A. Generally Applicable Mortality 

Tables 

Section 412 of the Internal Revenue 

Code (Code) prescribes minimum 

funding requirements for defined 

benefit pension plans. Section 430 

specifies the minimum funding 

requirements that apply generally to 

defined benefit plans that are not 

multiemployer plans.1 Section 430(a) 

defines the minimum required 

contribution for a plan year by reference 

to the plan’s funding target for the plan 

year. Under section 430(d)(1), a plan’s 

funding target for a plan year generally 

is the present value of all benefits 

accrued or earned under the plan as of 

the first day of that plan year. 

Section 430(h)(3) contains rules 

regarding the mortality tables to be used 

under section 430. Under section 

430(h)(3)(A), except as provided in 

section 430(h)(3)(C) or (D), the Secretary 

is to prescribe by regulation mortality 

tables to be used in determining any 

present value or making any 

computation under section 430. Those 

mortality tables must be based on the 

actual mortality experience of pension 

plan participants and projected trends 

in that experience. In prescribing those 

mortality tables, the Secretary is 

required to take into account results of 

available independent studies of 

mortality of individuals covered by 

pension plans.2 Under section 


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purposes of determining current liability as part of 

the calculation of the minimum full funding 

limitation under section 433(c)(7)(C) for a CSEC 

plan (as defined in section 414(y)). 

3The RP–2000 Mortality Tables Report is 

available at https://www.soa.org/experiencestudies/2000-2004/research-rp-2000-mortalitytables/. 

4 Generational mortality tables are a series of 

mortality tables, one for each year of birth, each of 

which fully reflects projected trends in mortality for 

individuals who are born in a particular year. 

430(h)(3)(B), the Secretary is required to 

make revisions to any table in effect 

under section 430(h)(3)(A) at least every 

10 years to reflect actual mortality 

experience of pension plan participants 

and projected trends in that experience. 

Section 430(h)(3)(C) prescribes rules 

for a plan sponsor’s use of substitute 

mortality tables reflecting the specific 

mortality experience of a plan’s 

population instead of using the 

generally applicable mortality tables. 

Under section 430(h)(3)(C), the plan 

sponsor may request the Secretary’s 

approval to use plan-specific substitute 

mortality tables that meet requirements 

specified in the statute. 

Section 430(h)(3)(D) provides for the 

use of separate mortality tables with 

respect to certain individuals who are 

entitled to benefits on account of 

disability. These separate mortality 

tables are permitted to be used with 

respect to disabled individuals in lieu of 

the generally applicable mortality tables 

provided pursuant to section 

430(h)(3)(A) or the substitute mortality 

tables under section 430(h)(3)(C). The 

Secretary is to establish separate tables 

for individuals with disabilities 

occurring in plan years beginning before 

January 1, 1995, and in later plan years, 

with the mortality tables for individuals 

with disabilities occurring in those later 

plan years applying only to individuals 

who are disabled within the meaning of 

Title II of the Social Security Act. 

Final regulations (TD 9419) under 

section 430(h)(3) were published in the 

Federal Register for July 31, 2008 (73 

FR 44632). The final regulations issued 

in 2008 include rules regarding 

generally applicable mortality tables, 

which are set forth in § 1.430(h)(3)–1 

(the 2008 general mortality table 

regulations), as well as rules regarding 

substitute mortality tables, which are set 

forth in § 1.430(h)(3)–2 (the 2008 

substitute mortality table regulations). 

The 2008 general mortality table 

regulations prescribe a base mortality 

table and a set of mortality improvement 

rates that are used to project mortality 

rates for years after the year 2000. The 

mortality tables included in those 

regulations are based on the mortality 

tables included in the RP–2000 

Mortality Tables Report (based on an 

experience study for the period 1990– 

1994 and referred to in this preamble as 

the RP–2000 mortality tables) released 

by the Society of Actuaries in July 2000 

(updated in May 2001). The mortality 

improvement rates included in those 

regulations are the Scale AA Projection 

Factors (which are based on mortality 

improvement for the period 1977 

through 1993), which were included in 

the RP–2000 Mortality Tables Report for 

use in conjunction with the RP–2000 

mortality tables.3

The 2008 general mortality table 

regulations prescribe the use of 

generational mortality tables,4 but 

include an option for plans to use static 

mortality tables. The static mortality 

tables (which are updated annually) use 

a single mortality table for all years of 

birth to approximate the present value 

that would be determined using the 

generational mortality tables. The 2008 

general mortality table regulations set 

forth static mortality tables for valuation 

dates occurring in 2008 and provide that 

static mortality tables for valuation 

dates occurring in later years will be 

published in the Internal Revenue 

Bulletin. Static mortality tables for 

valuation dates occurring during 2009– 

2013 were published in Notice 2008–85 

(2008–1 C.B. 747 (March 28, 2008)). 

Updated static mortality tables for 

valuation dates occurring during 2014 

and 2015 were published in Notice 

2013–49 (2013–32 I.R.B. 127 (July 10, 

2013)). Updated static mortality tables 

for valuation dates occurring in 2016 

and 2017 were published in Notice 

2015–53 (2015–33 I.R.B. 190 (July 31, 

2015)) and Notice 2016–50 (2016–38 

I.R.B. 371 (September 2, 2016)), 

respectively. 

Notice 2013–49 also requested 

comments on whether a separate 

disability mortality table is still 

warranted with respect to participants 

who became disabled before 1995. In 

addition, Notice 2013–49 noted that the 

Treasury Department (Treasury) and the 

IRS were aware that the Society of 

Actuaries was conducting a mortality 

study of pension plan participants and 

specifically requested comments on 

whether other studies of actual 

mortality experience of pension plan 

participants and projected trends of that 

experience were available that should 

be considered for use in developing 

mortality tables for future use under 

section 430(h)(3). 

In October 2014, the Retirement Plans 

Experience Committee (RPEC) of the 

Society of Actuaries issued a new 

mortality study of participants in 

private pension plans. The study, which 

is based on mortality experience for the 

years 2004 to 2008, is referred to as the 

RP–2014 Mortality Tables Report (and 

sets forth mortality tables that are 

referred to as the RP–2014 mortality 

tables). The RP–2014 Mortality Tables 

Report, as revised November 2014, is 

available at www.soa.org/Research/ 

Experience-Study/pension/research2014-rp.aspx. At the same time, RPEC 

issued a companion study of mortality 

improvement, referred to as the 

Mortality Improvement Scale MP–2014 

Report (which sets forth mortality 

improvement rates that are referred to as 

the Scale MP–2014 rates). As described 

in the Mortality Improvement Scale 

MP–2014 Report (available at 

www.soa.org/Research/ExperienceStudy/pension/research-2014-mp.aspx), 

the Scale MP–2014 rates were based on 

mortality improvement experience for 

the general population through 2009. 

In October 2015, RPEC released an 

update to the Scale MP–2014 rates. The 

updated rates, referred to as the Scale 

MP–2015 rates, were released as part of 

the Mortality Improvement Scale MP– 

2015 Report (available at https://

www.soa.org/Research/ExperienceStudy/Pension/research-2015-mp.aspx). 

The Scale MP–2015 rates were created 

using historical data for mortality 

improvement for the general population 

through 2011 and the same model and 

parameters that were used to produce 

the Scale MP–2014 rates. In conjunction 

with the release of the updated rates, 

RPEC indicated the intent to reflect the 

latest data available by providing future 

annual updates to the model as soon as 

practicable following the public release 

of updated data upon which the model 

is constructed. 

In October 2016, RPEC released a 

further update to the Scale MP–2014 

rates, which are referred to as the Scale 

MP–2016 rates. The Scale MP–2016 

rates take into account data for mortality 

improvement for the general population 

for 2012 and 2013, along with an 

estimate of mortality rates for 2014. As 

described in the Mortality Improvement 

Scale MP–2016 Report (available at 

www.soa.org/Research/ExperienceStudy/Pension/research-2016-mp.aspx), 

in developing the Scale MP–2016 rates, 

RPEC changed some of the parameters 

from those that were used in developing 

the Scale MP–2014 rates. 

B. Plan-Specific Substitute Mortality 

Tables 

Section 430(h)(3)(C) permits a plan 

sponsor to request approval by the 

Secretary to use plan-specific substitute 

mortality tables in lieu of the generally 

applicable mortality tables. If the 

Secretary determines that the proposed 


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5The 1,000-death threshold for credible mortality 

experience under the regulations was intended to 

provide a high degree of confidence that the plan’s 

past mortality experience will be predictive of its 

future mortality, and is consistent with relevant 

actuarial literature (see, for example, Thomas N. 

Herzog, Introduction to Credibility Theory (1999); 

Stuart A. Klugman, et. al., Loss Models: From Data 

to Decisions (2004)). 

6The revenue procedure identifies the WhittakerHenderson Type B graduation method or the KarupKing graduation method as acceptable methods. 

7Rev. Proc. 2007–37, 2007–1 CB 1433, was not 

in effect on November 2, 2015. It was issued in 2007 

in conjunction with proposed regulations regarding 

substitute mortality tables (REG–143601–06, 72 FR 

29456) and was replaced by Rev. Proc. 2008–62 

when those regulations were finalized in 2008. 

tables meet the statutory standards and 

approves the request, the substitute 

mortality tables are used to determine 

present values and make computations 

under section 430 during the period of 

consecutive plan years (not to exceed 

10) specified in the request. Under the 

statute, a substitute mortality table may 

be used for a plan, only if: (1) The plan 

has a sufficient number of plan 

participants and has been maintained 

for a sufficient period of time to have 

credible mortality information necessary 

to create a substitute mortality table; 

and (2) the table reflects the actual 

mortality experience of the plan’s 

participants and projected trends in 

general mortality experience. Except as 

provided by the Secretary, a plan 

sponsor may not use substitute 

mortality tables for any plan unless 

substitute mortality tables are 

established and used for each plan 

maintained by the plan sponsor or a 

member of its controlled group. 

The 2008 substitute mortality table 

regulations provide for review by the 

Commissioner of a plan sponsor’s 

request for approval to use substitute 

mortality tables. Under those 

regulations, to use substitute mortality 

tables with respect to a plan, a plan 

sponsor must submit a written request 

to the Commissioner that demonstrates 

that those substitute mortality tables 

comply with applicable requirements. A 

request for approval to use substitute 

mortality tables must specify the first 

plan year and the term of years for 

which the tables are requested to be 

used. 

Substitute mortality tables may not be 

used for a plan year unless the plan 

sponsor submits the request at least 7 

months before the first day of the first 

plan year for which the substitute 

mortality tables are to apply. The 

Commissioner has 180 days to review a 

request for approval to use substitute 

mortality tables. If the Commissioner 

does not deny the request within this 

180-day period, the request is deemed to 

have been approved unless the 

Commissioner and the plan sponsor 

have agreed to extend that period. 

Under the 2008 substitute mortality 

table regulations, substitute mortality 

tables for a plan must be established 

separately for each gender, and a 

substitute mortality table may be 

established for a gender only if there is 

credible mortality experience with 

respect to that gender. If the mortality 

experience for one gender is credible 

but the mortality experience for the 

other gender is not credible, the 

substitute mortality tables are used for 

the gender that has credible mortality 

experience, and the generally applicable 

mortality tables are used for the gender 

that does not have credible mortality 

experience. 

Under the 2008 substitute mortality 

table regulations, there is credible 

mortality experience with respect to a 

gender if and only if, over the period 

covered by the experience study, there 

are at least 1,000 deaths of individuals 

of that gender.5 For this purpose, the 

minimum length of the experience 

study period is 2 years and the 

maximum length of the experience 

study period generally is 5 years. 

Furthermore, the last day of the final 

year reflected in the experience data 

must be less than three years before the 

first day of the first plan year for which 

the substitute mortality tables are to 

apply. 

Under the 2008 substitute mortality 

table regulations, development of 

substitute mortality tables for a plan 

requires creation of a base table and 

identification of a base year, which are 

then used to determine the substitute 

mortality tables. The base table must be 

developed from a study of the mortality 

experience of the plan using amountsweighted data. Under those regulations, 

a plan’s substitute mortality tables must 

be generational mortality tables that are 

determined using the base mortality 

tables developed from the experience 

study and the Scale AA Projection 

Factors (that is, using the same basis for 

mortality improvement that is used 

under 2008 general mortality table 

regulations). 

Under the 2008 substitute mortality 

table regulations, the use of substitute 

mortality tables is terminated early in 

certain circumstances, including 

pursuant to a replacement of the 

generally applicable mortality tables. 

The early termination pursuant to such 

a replacement must be effective as of a 

date specified in guidance published in 

the Internal Revenue Bulletin. 

Rev. Proc. 2008–62 (2008–2 C.B. I.R.B. 

935) sets forth the procedure by which 

a plan sponsor of a defined benefit plan 

may request and obtain approval to use 

plan-specific substitute mortality tables 

in accordance with section 430(h)(3)(C). 

The revenue procedure specifies the 

information that must be provided in a 

request for approval to use substitute 

mortality tables and specifies two 

alternative acceptable methods of 

construction for base substitute 

mortality tables. Under section 11 of 

Rev. Proc. 2008–62, a base table for a 

population may be created from the 

unadjusted base table for the population 

through the application of a graduation 

method generally used by the actuarial 

profession in the United States.6 Section 

12 of Rev. Proc. 2008–62 provides for an 

alternative method of constructing a 

base table through the application of a 

fixed percentage to the mortality rates of 

a standard mortality table, projected to 

the base year. 

Section 503 of the Bipartisan Budget 

Act of 2015, Public Law 114–74 (129 

Stat. 584 (2015)), which was enacted 

November 2, 2015, provides for changes 

to the rules on the use of substitute 

mortality tables. Under that section, 

‘‘the determination of whether plans 

have credible information shall be made 

in accordance with established actuarial 

credibility theory, which (1) is 

materially different from the rules under 

[section 430(h)(3)(C)], including 

Revenue Procedure 2007–37,7 that are 

in effect on [November 2, 2015]; and (2) 

permits the use of tables that reflect 

adjustments to the tables described in 

[section 430(h)(3)(A) and (B)]’’ if those 

adjustments are based on the actual 

experience of the pension plan 

maintained by the plan sponsor. 

Proposed regulations regarding 

revisions to mortality tables under 

section 430(h)(3) (REG–112324–15) 

were published in the Federal Register 

on December 29, 2016 (81 FR 95911). 

The proposed regulations contain 

revisions to the generally applicable 

mortality tables (based on the RP–2014 

Mortality Tables Report), as well as new 

rules regarding substitute mortality 

tables that reflect section 503 of the 

Bipartisan Budget Act of 2015. 

Comments were received on the 

proposed regulations, and a public 

hearing was held on April 13, 2017. 

After consideration of the comments, 

the proposed regulations are adopted by 

this Treasury decision subject to certain 

changes, the most significant of which 

are described in this preamble under the 

heading Explanation of Provisions. 

Explanation of Provisions 

I. Overview 

These final regulations revise the 

methodology for developing the 


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8Mortality tables that may be used as an 

alternative to the tables provided in these 

regulations with respect to certain disabled 

individuals are provided in Rev. Rul. 96–7 (1996– 

1 CB 59). 

9See the August 2013 Literature Review and 

Assessment of Mortality Improvement Rates in the 

U.S. Population: Past Experience and Future LongTerm Trends, available at www.soa.org/Files/ 

Research/Exp-Study/research-2013-lit-review.pdf. 

10See ‘‘The Long-Range Demographic 

Assumptions for the 2017 Trustees Report,’’ Office 

of the Chief Actuary, Social Security 

Administration (July 13, 2017), at Mortality, page 17 

(available at https://www.ssa.gov/OACT/TR/2017/ 

2017_Long-Range_Demographic_Assumptions.pdf). 

generally applicable mortality tables 

that are used to determine present value 

or make any computation under section 

430. Pursuant to section 417(e)(3)(B), a 

modified version of these tables will be 

used for purposes of determining the 

amount of a single-sum distribution (or 

another accelerated form of 

distribution). This revised methodology 

for developing tables under section 

430(h)(3)(A) is being issued pursuant to 

the requirement under section 

430(h)(3)(B) to revise the mortality 

tables used under section 430 at least 

every 10 years to reflect the actual 

mortality experience of pension plan 

participants and projected trends in that 

experience. As under the 2008 general 

mortality table regulations, the 

methodology involves the separate 

determination of base tables and the 

projection of mortality improvement. 

These regulations also revise the rules 

regarding substitute mortality tables. 

This revision is being made pursuant to 

section 503 of the Bipartisan Budget Act 

of 2015, which requires that the 

determination of whether a plan has 

credible information be made in 

accordance with established actuarial 

credibility theory. Following enactment 

of that requirement, Treasury and the 

IRS undertook a review of actuarial 

literature regarding credibility theory 

and consulted with experts on that topic 

from the Society of Actuaries. Based on 

that review and analysis, these 

regulations set forth a method for 

developing substitute mortality tables 

that is materially different from the 

method that is required under the 2008 

substitute mortality table regulations 

and the associated revenue procedure. 

The method for developing substitute 

mortality tables that is set forth in the 

final regulations is simpler than the 

graduation method that applies under 

the 2008 substitute mortality table 

regulations and also accommodates the 

use of substitute mortality tables for 

plans with smaller populations that 

have only partially credible mortality 

experience. 

II. Generally Applicable Mortality 

Tables 

A. Base Mortality Tables 

Under these regulations, the generally 

applicable base mortality tables are 

derived from the tables contained in the 

RP–2014 Mortality Tables Report. In 

response to Notice 2013–49, 

commenters generally recommended 

that the RP–2014 mortality tables form 

the basis for the mortality tables used 

under section 430. After reviewing the 

RP–2014 mortality tables, the 

accompanying report published by the 

Society of Actuaries, and related public 

comments, Treasury and the IRS 

determined that the experience study 

used to develop the RP–2014 mortality 

tables is the best available study of the 

actual mortality experience of pension 

plan participants (other than disabled 

individuals). As a result, Treasury and 

the IRS issued proposed regulations that 

use the RP–2014 mortality tables as the 

foundation for the base mortality tables 

used to project the mortality rates of 

pension plan participants (other than 

disabled individuals).8

Most commenters supported the 

selection of the base mortality tables in 

the proposed regulations. One 

commenter opposed this selection but 

did not suggest any alternative. 

Accordingly, the base mortality tables 

under these final regulations are the 

same as in the proposed regulations. 

Like the mortality tables provided in the 

2008 general mortality table regulations, 

the mortality tables under these final 

regulations are gender-distinct because 

of significant differences between 

expected male mortality and expected 

female mortality. In addition, as under 

the 2008 general mortality table 

regulations, these regulations set forth 

separate mortality rates for annuitants 

and nonannuitants. 

The base tables that are set forth in 

these final regulations are used to 

develop the mortality tables for future 

years. These base tables have a base year 

of 2006 (the central year of the 

experience study used to develop the 

mortality tables in the RP–2014 

Mortality Tables Report). These base 

tables generally have the same mortality 

rates as the RP–2014 mortality tables 

after factoring out the mortality 

improvements from 2007 to 2014 

(calculated using the Scale MP–2014 

rates). However, these base tables also 

include nonannuitant mortality rates for 

ages below age 18 and above age 80 and 

annuitant mortality rates for ages below 

age 50. This generally is the same 

approach that was used to develop the 

base tables included in the 2008 general 

mortality table regulations. 

B. Mortality Improvement and Static 

Mortality Tables 

The proposed regulations, like the 

2008 general mortality table regulations, 

provided that expected trends in 

mortality experience must be taken into 

account through the use of either 

generational or annually updated static 

mortality tables. In accordance with 

section 430(h)(3)(B), the proposed 

regulations updated the mortality 

improvement rates used under the 2008 

general mortality table regulations. To 

select up-to-date mortality improvement 

rates, Treasury and the IRS reviewed the 

Mortality Improvement Scale MP–2014 

Report, related public comments, the 

data sources cited in those comments, 

the Mortality Improvement Scale MP– 

2015 Report, the Mortality Improvement 

Scale MP–2016 Report, and other 

published data sources.9 After that 

review, Treasury and the IRS issued 

proposed regulations that applied the 

MP–2016 rates to develop mortality 

tables for use in 2018. 

Some commenters supported the 

selection of the mortality improvement 

rates in the proposed regulations, while 

other commenters expressed concerns 

about the selection of those rates. Those 

commenters who expressed concern 

about the mortality improvement rates 

noted that the selection of a long-term 

mortality improvement rate assumption 

is inherently speculative and cautioned 

against using the assumptions regarding 

the rate of long-term mortality 

improvement that were used by RPEC 

(which are a long-term rate of 1.0 

percent per year for ages 85 and 

younger, grading down to 0.85 percent 

at age 95, and further grading down to 

0 at age 115). Instead of the RPEC 

assumptions, these commenters 

suggested that Treasury and the IRS use 

assumptions regarding the rate of longterm mortality improvement that are 

closer to the rates that are used by the 

Office of the Actuary within the Social 

Security Administration. Those rates 

also vary by age group, and the 

documentation accompanying the 2017 

report of the Board of Trustees of the 

Federal Old-Age, Survivors Insurance 

and Disability Insurance Trust Funds 

indicates that, under the intermediate 

assumptions (which reflect the Trustees’ 

best estimates of future experience), the 

weighted average over all ages of those 

assumed long-term mortality 

improvement rates is 0.72 percent per 

year.10

Treasury and the IRS carefully 

considered the assumptions used by 

Office of the Actuary within the Social 

Security Administration and compared 

it with the long-term assumptions 


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11See ‘‘2015 Technical Panel on Assumptions 

and Methods Report to the Social Security Advisory 

Board,’’ available at www.ssab.gov/Details-Page/ 

ArticleID/656/2015-Technical-Panel-onAssumptions-and-Methods-A-Report-to-the-BoardSeptember-2015. 

12See Comparing CBO’s Long-Term Projections 

with Those of the Social Security Trustees: Hearing 

before the Subcommittee on Social Security, 

Committee on Ways and Means, U.S. House of 

Representatives, 114th Cong. September 21, 2016 

(Testimony of Keith Hall), available at https://

www.cbo.gov/sites/default/files/114th-congress2015-2016/reports/51988- 

socialsecuritytestimony.pdf. 

currently recommended by RPEC. In 

evaluating the merits of each, Treasury 

and the IRS took into consideration the 

views of the Technical Panel of the 

Social Security Advisory Board. The 

Social Security Advisory Board is an 

independent federal government 

agency, and the Technical Panel, which 

is comprised of actuaries, economists 

and demographers, is charged by the 

Advisory Board with reviewing the 

assumptions and methods used in the 

annual report of the Board of Trustees 

of the Federal Old-Age, Survivors 

Insurance and Disability Insurance 

Trust Funds. The Technical Panel, 

which issues a report every 4 years, has 

consistently recommended that the 

mortality improvement assumption 

used by the Office of the Actuary be 

increased.11 In addition, the 

Congressional Budget Office uses a 

faster rate of mortality improvement in 

evaluating Social Security solvency than 

the Office of the Actuary.12

After review and consideration of the 

comments, the documentation 

accompanying the Trustees’ Report, and 

the views of the Technical Panel of the 

Social Security Advisory Board, 

Treasury and the IRS have concluded 

that the procedures that RPEC used to 

develop the Scale MP–2016 rates 

generate mortality improvement rates 

that currently are the appropriate rates 

for use in developing mortality tables to 

be used for purposes of pension 

funding. Accordingly, these regulations 

provide that the mortality improvement 

rates for valuation dates in 2018 are the 

Scale MP–2016 rates. 

Treasury and the IRS understand that 

RPEC expects to issue updated mortality 

improvement rates that reflect new data 

for mortality improvement trends for the 

general population on an annual basis. 

As noted by the commenters, while the 

rate of mortality improvement has 

fluctuated significantly on a year-to-year 

basis, there has been a significant 

reduction in the rate of improvement 

over the past few years compared to the 

rate of improvement for the past 25 

years. RPEC has indicated the intent to 

continually review the methodology 

used in its mortality improvement 

model in an effort to improve the overall 

effectiveness of the model, especially 

with respect to year-over-year stability 

and forecast accuracy, and it has 

identified the assumed long-term rate of 

mortality improvement and graduation 

techniques as two of the items included 

in this review. In establishing the 

mortality improvement rates to be used 

under section 430(h)(3) for valuation 

dates in years after 2018, Treasury and 

the IRS will continue to take into 

account RPEC’s updates (including any 

modifications to RPEC’s methodology), 

as well as other sources of data or 

analyses regarding mortality 

improvement. These regulations provide 

that the mortality improvement rates 

applicable for those future valuation 

dates will be specified in guidance to be 

published in the Internal Revenue 

Bulletin. See § 601.601(d)(2)(ii)(b) of 

this chapter. If Treasury and the IRS 

determine that significant revisions to 

the mortality improvement rates are 

appropriate, the revisions may first be 

proposed in a new rulemaking in order 

to allow for public comment before the 

rule is finalized. 

Some commenters asked that 

Treasury and the IRS commit to 

providing the mortality improvement 

rates for a calendar year at least 12 

months before the start of that year. 

Treasury and the IRS understand that a 

significant motivation for this request is 

to avoid the issuance of new mortality 

improvement rates in the early part of 

a calendar year (because issuance of 

new mortality improvement rates at that 

time could result in the need to revise 

calculations that have already been 

made in the course of preparing a plan 

sponsor’s financial statement as of the 

previous December 31). While Treasury 

and the IRS intend that the mortality 

improvement rates for a calendar year 

generally will be issued more than 12 

months in advance of that year, the final 

regulations do not include a provision 

requiring that the mortality 

improvement rates for a calendar year 

be issued within this timeframe. 

Retaining the flexibility to issue 

mortality improvement rates closer to 

the date they would become effective 

will allow additional time for the 

possibility that certain revisions to the 

mortality improvement rates will first be 

published in proposed form. 

Other commenters requested that 

Treasury and the IRS consider updating 

the mortality tables on a less frequent 

basis than annually. Although the RPEC 

indicated its intent to issue updated 

mortality improvement rates on an 

annual basis, the final regulations do 

not require the mortality improvement 

rates under section 430(h)(3) to be 

updated annually. However, to 

minimize the discontinuities in 

mortality rates that could arise from 

infrequent updates, Treasury and the 

IRS contemplate that generally the rates 

will be updated annually. If the changes 

from one year to the next are minimal, 

Treasury and the IRS may choose not to 

update the rates for that year. 

As under the 2008 general mortality 

table regulations, the proposed 

regulations take into account the 

limitations of some current actuarial 

software that is not designed to use 

generational mortality tables and 

continue to permit the use of static 

mortality tables. These static mortality 

tables, when used to determine the 

present value of an annuity, 

approximate the present value that 

would be determined using the 

generational mortality tables. All but 

one commenter supported the option to 

use static mortality tables, and these 

final regulations provide for this option. 

These static tables consist of separate 

gender-specific tables, which are 

updated annually. The static mortality 

tables that will be used for 2018 are 

included in these regulations. For later 

years, updated static mortality tables 

will be set forth in guidance published 

in the Internal Revenue Bulletin. See 

§ 601.601(d)(2)(ii)(b) of this chapter. 

C. Use of Section 430 Mortality Tables 

for Other Provisions 

Section 417(e)(3) generally provides 

that the present value of certain benefits 

under a qualified pension plan 

(including single-sum distributions) 

must not be less than the present value 

of the accrued benefit using applicable 

interest rates and the applicable 

mortality table. Section 417(e)(3)(B) 

defines the term ‘‘applicable mortality 

table’’ as the mortality table specified 

for the plan year for minimum funding 

purposes under section 430(h)(3)(A) 

(without regard to the rules for 

substitute mortality tables under section 

430(h)(3)(C) or mortality tables for 

disabled individuals under section 

430(h)(3)(D)), modified as appropriate 

by the Secretary. The modifications to 

the section 430(h)(3)(A) mortality table 

used to determine the section 

417(e)(3)(B) applicable mortality table 

are not addressed in these regulations 

and are currently provided in Revenue 

Ruling 2007–67 (2007–2 C.B. 1047). 

As under the proposed regulations, 

the final regulations provide that the 

same mortality assumptions that apply 

for purposes of section 430(h)(3)(A) and 

§ 1.430(h)(3)–1(a)(2) are used to 

determine a plan’s current liability for 

purposes of applying the full-funding 


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13However, new mortality tables may affect plan 

operations relating to the requirements of section 

436 during the 2018 plan year. 

14Sudipto Banerjee, Ph.D., Employee Benefits 

Research Institute, Issue Brief: Annuity and LumpSum Decisions in Defined Benefit Plans: The Role 

of Plan Rules, January 2013, available at https://

www.ebri.org/pdf/briefspdf/EBRI_IB_01- 

13.No381.LSDs2.pdf. 

15U.S. Government Accountability Office, GAO 

15–74, Participants Need Better Information When 

Offered Lump Sums That Replace Their Lifetime 

Benefits (January 2015). This report also notes the 

substantial financial advantages that exist for plan 

sponsors implementing lump sum windows and 

attributes the recent increase in lump-sum window 

offers, in part, to the outdated mortality tables in 

the current regulations, which result in reduced 

payments to plan participants. Id. at pp. 16–17. 

16Brendan McFarland, After a few ups and 

downs, corporate pension funding levels showed 

little change in 2016: Late-year rise in interest rates 

and stock market performance mitigate earlier 

downturn in funded status, Willis Towers Watson 

Insider, Vol. 27, No. 2 (February 2017) at p. 3, 

available at https://www.towerswatson.com/en-US/ 

Insights/Newsletters/Americas/insider. 

17See section 4. of the Regulatory Impact 

Assessment provided under the heading Special 

Analyses, Regulatory Planning and Review 

(Executive Orders 12866 and 13563) in this 

preamble for a discussion of needed changes in 

administrative systems. 

18There is no provision for defined benefit plans 

that are not subject to the requirements of section 

430 (such as multiemployer plans) to request 

approval to use of substitute mortality tables. 

However, the mortality tables under section 

430(h)(3) are required to be used for those plans 

only for very limited purposes (and the mortality 

tables used for those plans for most purposes, while 

subject to the requirements of section 431(c)(3) or 

433(c)(3), are not tables specified by statute or 

regulations). 

rules of section 431(c)(6) (in the case of 

a multiemployer plan) and section 

433(c)(7)(C) (in the case of a CSEC plan). 

For this purpose, a multiemployer plan 

or CSEC plan is permitted to apply 

either the annually-adjusted static 

mortality tables or the generational 

mortality tables. 

D. Effective Date 

The proposed regulations provide that 

the regulations will be effective 

beginning in 2018. Some commenters 

expressed concern that this effective 

date would not allow adequate time for 

compliance. One commenter requested 

that the effective date of the regulations 

be no sooner than 18 months after the 

regulations are finalized in order to give 

plan sponsors adequate time to plan for 

the higher level of contributions that 

will be required under the new 

mortality assumptions. Treasury and the 

IRS understand that most employers 

have been planning for the issuance of 

updated mortality tables for the 

purposes of section 430 since the RP– 

2014 Mortality Tables Report was issued 

in 2014 and many of those employers 

are already using updated mortality 

tables for financial reporting purposes. 

Furthermore, any additional required 

contributions for a plan resulting from 

the adoption of the new tables will not 

be due before September 15, 2019. For 

a plan with a calendar plan year, this 

date is 81⁄2 months after the end of the 

first plan year for which the regulations 

apply.13

Moreover, as described in section II.C 

of this Explanation of Provisions, the 

amount of a single-sum distribution 

computed as the present value of an 

annuity is determined using a mortality 

table that is based on the generally 

applicable mortality tables used for 

minimum funding purposes. Thus, 

retaining the mortality tables under 

existing regulations for the 2018 plan 

year, as requested by some commenters, 

would result in inappropriately 

depressing the amount of single-sum 

distributions payable to affected 

participants during the 2018 plan year 

(resulting in a permanent loss of 

retirement assets for those participants). 

A 2013 study indicates that 

approximately 56 percent of retiring 

participants in a traditional defined 

benefit plan with an unlimited singlesum option choose that option.14 In 

addition, the Government 

Accountability Office recently issued a 

study examining the increase in ‘‘lumpsum window’’ offers—typically, limited 

time offers to participants who are no 

longer employed by the sponsor but still 

waiting for their pension benefit to 

begin in the future, or retirees already 

receiving their pension annuity 

payments.15 Similarly, Willis Towers 

Watson reported significant risk 

transferring activity in recent years 

through lump sum windows and other 

means.16

Because these rules were proposed in 

December of 2016 to be applicable as 

final regulations for plan years 

beginning on and after January 1, 2018, 

the Treasury Department and the IRS 

believe that many plan sponsors have 

had adequate time to set aside funds 

needed for additional pension 

contributions for the 2018 plan year. 

Furthermore, because the steps that plan 

sponsors will need to take to update 

their administrative systems in response 

to these final regulations are not 

significantly different from the steps 

they would need to take in response to 

the annual update of mortality tables 

that has previously occurred at this time 

of the year, the Treasury Department 

and the IRS believe that plan sponsors 

generally will have sufficient time to 

make any needed changes to these 

administrative systems.17

The final regulations generally retain 

the effective date that was proposed, 

and apply to plan years beginning on or 

after January 1, 2018. In response to 

comments indicating that this effective 

date may create certain administrative 

or financial difficulties, the final 

regulations provide an option that may 

be used in certain circumstances for the 

2018 plan year to apply the regulations 

that were formerly in effect. 

Specifically, for a plan for which 

substitute mortality tables are not used 

for the 2018 plan year, mortality tables 

determined in accordance with 

regulations previously in effect may be 

used for purposes of applying the rules 

of section 430 for a valuation date 

occurring during 2018 if the plan 

sponsor (1) concludes that the use of 

mortality tables determined in 

accordance with the final regulations for 

the plan year would be administratively 

impracticable or would result in an 

adverse business impact that is greater 

than de minimis, and (2) informs the 

actuary of the intent to apply this 

option. While this option provides 

significant flexibility to plan sponsors, 

the use of the option will not affect the 

mortality table used to determine 

minimum present value for 

distributions with annuity starting dates 

in stability periods that begin during 

2018 (which is based on the generally 

applicable mortality tables under 

section 430(h)(3)(A) that apply if this 

option is not used). Therefore, the lumpsum distributions received by 

participants retiring in 2018 will 

appropriately reflect their expected 

longevity. 

III. Plan-Specific Substitute Mortality 

Tables 

A. Application of Established Actuarial 

Credibility Theory 

These final regulations contain a 

comprehensive revision of the rules 

regarding plan-specific substitute 

mortality tables for plans that are 

subject to the rules of section 430.18

These regulations carry over many of 

the rules regarding substitute mortality 

tables from the 2008 substitute mortality 

table regulations. However, after 

analyzing the actuarial literature 

regarding credibility theory, Treasury 

and the IRS made a number of changes 

to the rules relating to the development 

of substitute mortality tables. 

Specifically, these final regulations, like 

the proposed regulations, generally 

require that a substitute mortality table 

be constructed by multiplying the 

mortality rates from a projected version 

of the generally applicable base 

mortality table by a mortality ratio (that 


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19As under the 2008 regulations and the 

proposed regulations, the final regulations provide 

for permissive aggregation of plans of a plan 

sponsor for purposes of developing and using 

substitute mortality tables. The final regulations 

clarify that if two or more plans with different plan 

years are aggregated, the experience study may 

consist of data that is collected over different 

periods for plans with different plan years, subject 

to certain conditions. 

20 If the plan sponsor submits such a request 

during 2017, then mortality improvement is 

reflected using the mortality improvement rates that 

generally apply for use for 2018, which are the 

Scale MP–2016 rates. 

21Although the use of a graduation technique 

under Rev. Proc. 2008–62 enables a plan with fewer 

than 1,000 deaths at each age to have credible 

mortality experience that may be used to establish 

a substitute mortality table, the statutory instruction 

providing that the determination of whether a plan 

has credible mortality information be made in 

accordance with established actuarial credibility 

theory which is materially different than the rules 

in effect on November 2, 2015, led to the 

elimination of that technique. 

is, a ratio of the actual deaths for the 

population to the expected deaths 

determined using the standard mortality 

tables for that population). 

Use of mortality ratios (rather than 

providing for the graduation of raw 

mortality rates as under the 2008 

substitute mortality table regulations) 

will make it easier for plan sponsors to 

develop substitute mortality tables 

because it eliminates the need to apply 

a complex graduation technique. It also 

facilitates efficient IRS review of 

applications for approval to use 

substitute mortality tables, which is 

particularly important in light of the 

other major change made in the 

regulations (permitting the use of 

substitute mortality tables for a plan that 

has mortality experience that is only 

partially credible). As a result of the 

changes made in these regulations, 

Treasury and the IRS expect that 

significantly more plan sponsors will 

request approval to use substitute 

mortality tables. 

B. Development of Substitute Mortality 

Tables for Plans With Full Credibility 

The substitute mortality table for a 

population with full credibility must be 

determined by applying projected 

mortality improvement to a base 

substitute mortality table developed 

using an experience study of the 

population. Like the proposed 

regulations, the final regulations use the 

same general requirements for an 

experience study as under the 2008 

substitute mortality table regulations but 

reflect certain changes from the 

proposed regulations in response to 

comments. Specifically, the experience 

study generally must cover a period of 

at least 2 (and no more than 5) 

consecutive 12-month periods that ends 

less than 3 years before the first day of 

the first plan year for which the 

substitute mortality tables are to apply, 

and must cover the same period for all 

populations within a plan.19 However 

the final regulations include an 

exception that permits the use of an 

earlier study period if the submission is 

made more than 1 year (and less than 

2 years) before the first day of the first 

plan year for which the substitute 

mortality tables are proposed to apply. 

Under this exception, the last day of the 

experience study period is permitted to 

be 3 years or more before the first day 

of the first plan year for which the 

substitute mortality tables are proposed 

to apply, provided that the last day of 

the experience study period is less than 

2 years before the application is 

submitted. 

A base substitute mortality table 

generally is determined by multiplying 

the mortality rates from the 

corresponding standard mortality table 

(that is, the generally applicable base 

mortality table for the population, 

projected with mortality improvement 

to the base year for the base substitute 

mortality table) by the mortality ratio for 

the population. For this purpose, the 

mortality improvement rates that apply 

for the calendar year during which the 

plan sponsor submits the request for 

approval to use substitute mortality 

tables are used to project the generally 

applicable base mortality table to the 

base year for the base substitute 

mortality table.20 The mortality ratio is 

determined as a fraction, the numerator 

of which is the number of actual deaths 

during the experience study period 

(with each death weighted by the 

benefit amount) and the denominator of 

which is the number of expected deaths 

during that period (determined using 

the standard mortality table) weighted 

by the benefit amount. An individual’s 

benefit amount (which is used to 

determine amounts-weighted mortality 

rates and for other purposes in the 

construction of base substitute mortality 

tables) is the individual’s accrued 

benefit expressed in the form of an 

annual benefit commencing at normal 

retirement age (or at the current age, if 

later) if the individual has not 

commenced benefits, and the 

individual’s annual payment if the 

individual has commenced benefits. 

Consistent with section 503 of the 

Bipartisan Budget Act of 2015 (and 

unlike § 1.430(h)(3)–2(c)(2)(ii)(D) of the 

2008 substitute mortality table 

regulations, which provides that the 

Commissioner may permit the use of 

other recognized mortality tables to 

construct the base substitute mortality 

table), the regulations provide that the 

standard mortality table that must be 

used for this purpose is the generally 

applicable base mortality table projected 

with mortality improvement to the base 

year for the base substitute mortality 

table. 

Some commenters pointed out that 

multiplying mortality ratios for a 

population by the mortality rates in the 

applicable standard mortality table 

could yield inappropriate results at 

extremely old ages. In response to those 

comments, the final regulations provide 

that mortality rates under the base 

substitute mortality tables must be the 

same as the mortality rates under the 

standard mortality table for ages above 

109 and that a modified mortality ratio 

is used for ages from 96 through 109 (to 

accomplish a gradual transition to the 

standard mortality table while avoiding 

inappropriate results). If the mortality 

ratio for the population is greater than 

1.0, the modified mortality ratio for an 

age within this range is equal to the 

mortality ratio for the population 

reduced by 1/15th of the excess of the 

mortality ratio over 1.0 for each year by 

which the age exceeds 95. If the 

mortality ratio for the population is less 

than 1.0, the modified mortality ratio for 

an age within this range is equal to the 

mortality ratio for the population 

increased by 1/15th of the excess of 1.0 

over the mortality ratio for each year by 

which the age exceeds 95. 

C. Standards for Full Credibility 

The proposed regulations revised the 

standard for full credibility of a 

population under the 2008 substitute 

mortality table regulations (which is 

1,000 actual deaths for the relevant 

population during the experience study 

period) to better reflect established 

actuarial credibility theory. Under 

established actuarial credibility theory, 

the 1,000-death threshold (which is a 

rounding down of the 1,082 actual 

deaths that would be needed for a 90% 

confidence level that the measured rate 

is within 5% of the underlying mortality 

rate) should apply to the credibility for 

a single mortality rate and not an entire 

mortality table.21 Moreover, the 1,000 

death threshold did not take into 

account the well-established actuarial 

principle that mortality experience 

within a population will vary 

predictably based on the amount of the 

annuity (or life insurance, as 

applicable). The base tables for the 

generally applicable mortality tables 

were constructed on an amountsweighted basis (under which the 

individuals with higher benefit amounts 

have a greater weight in the 

computation of the mortality rate for a 


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22This formula for the number of deaths needed 

for full credibility is based on the assumption that 

the distribution of releases from liability due to 

deaths follows a compound Poisson model. See 

www.actuaries.ca/members/publications/2002/ 

202037e.pdf. 

23See Gavin Benjamin, Selecting Mortality 

Tables: A Credibility Approach, available at 

www.soa.org/Files/Research/Projects/research2008-benjamin.pdf. 

24 In the proposed regulations, these formulas 

were stated as amounts to be computed separately 

for each age and then summed for the population. 

The final regulations instead state these formulas 

more concisely as amounts to be computed for the 

entire population. These two approaches yield 

mathematically identical results. 

25This option is described in section III.F.2 of 

this Explanation of Provisions (Option to use 

combined male and female mortality experience). 

26 If a plan has credible mortality information for 

one gender but not for the other gender, the length 

of the period of this demonstration is the length of 

the experience study for that plan. 

particular age); accordingly, substitute 

mortality tables should be constructed 

using the same principle. 

Using established actuarial credibility 

theory to evaluate whether a population 

has fully credible mortality experience 

entails the use of a threshold that takes 

into account the dispersion of benefits 

within the population. Accordingly, 

under the proposed regulations, the 

number of deaths that are needed for a 

population within a plan to have fully 

credible mortality experience is 

determined as the product of 1,082 and 

the benefit dispersion factor for the 

population.22 The benefit dispersion 

factor for a population is equal to the 

number of expected deaths for the 

population during the experience study 

period, multiplied by the sum of the 

mortality-weighted squares of the 

benefits, divided by the square of the 

sum of the mortality-weighted 

benefits.23

Commenters supported the actuarial 

soundness of the standard for fully 

credible mortality information under the 

proposed regulations, and the final 

regulations adopt the provisions of the 

proposed regulations regarding full 

credibility. At the request of 

commenters, the regulations include 

expressions of various formulas in 

mathematical notation to assist actuaries 

in making computations under the 

regulations.24

One commenter noted that the 

increase of the threshold for full 

credibility (together with the inability to 

reflect the pattern of the plan’s mortality 

experience at different ages) may 

produce substitute mortality tables that 

are substantially different than those 

that are currently in use. To address this 

concern, in part, the final regulations 

include an option to increase the 

credibility of a plan’s mortality 

experience by basing it on the combined 

mortality experience of both genders.25

D. Partial Credibility 

As under the proposed regulations, 

the final regulations permit substitute 

mortality tables to be used for a plan 

that does not have sufficient deaths to 

have fully credible mortality 

information. In accordance with 

established actuarial credibility theory, 

the substitute mortality table used for 

such a plan is the weighted average of 

the standard mortality table and the 

substitute mortality table that would be 

developed for the plan if it were to have 

fully credible mortality information. 

The weight for the substitute mortality 

table that would be developed for the 

plan if the plan were to have fully 

credible mortality information is the 

square root of a fraction, the numerator 

of which is the actual number of deaths 

for the population within the experience 

study period and the denominator of 

which is the number of deaths needed 

for the plan to have fully credible 

mortality information. 

E. Controlled Group Consistency 

Requirement 

Under section 430(h)(3)(iv) there is a 

general consistency requirement for the 

use of substitute mortality tables with 

respect to all plans within a controlled 

group. Thus, use of substitute mortality 

tables for a plan is generally permitted 

only if substitute mortality tables are 

used for all plans subject to section 430 

that are maintained within the 

controlled group of the plan sponsor. 

The 2008 substitute mortality table 

regulations set forth an exception from 

this consistency requirement for plans 

that did not have credible mortality 

experience. As a result of the change 

permitting the use of substitute 

mortality tables for plans that have only 

partially credible mortality information, 

Treasury and the IRS concluded that the 

exception should be modified so that it 

only applies to plans with a relatively 

small population. Accordingly, the 

regulations provide that a population 

does not have credible mortality 

information (and so a substitute 

mortality table is neither permitted nor 

required to be used for that population) 

if the actual number of deaths for that 

population during the experience study 

period is less than 100. For this 

purpose, the length of the experience 

study period must be the same length as 

the longest experience study period for 

any plan in the controlled group 26 and 

must end less than 3 years before the 

first day of the first plan year for which 

the substitute mortality tables are to 

apply. Treasury and the IRS proposed 

the use of a threshold of 100 deaths to 

balance the benefit of the use of 

substitute mortality tables for a plan 

with a relatively small population 

(which would be small, given the 

relatively low weight assigned to that 

plan’s partially credible mortality 

experience) against the burden of 

developing substitute mortality tables 

for that plan (which would be required 

to comply with the controlled group 

consistency requirement). No comments 

were received objecting to this threshold 

or recommending a different threshold. 

As a result, the final regulations adopt 

the proposed 100-death threshold. 

F. Other Rules Relating to the Use of 

Substitute Mortality Tables 

1. Multiple-Employer Plans 

In response to comments, the final 

regulations provide rules regarding the 

use of substitute mortality tables in 

connection with multiple-employer 

plans. Under the final regulations, the 

application for use of substitute 

mortality tables in the case of a 

multiple-employer plan must be made 

by the plan administrator, and the 

substitute mortality tables must apply 

on a plan-wide basis (even if the plan 

is subject to the rules of section 

413(c)(4)(A)). 

In addition, the final regulations 

provide special rules for the application 

of the controlled group consistency rule 

in the case of a multiple-employer plan. 

Under this special rule, an employer 

participating in a multiple-employer 

plan is treated as maintaining that plan 

if and only if the proportion of the 

plan’s funding target attributable to the 

employees and former employees of the 

employer and members of the 

employer’s controlled group is greater 

than 50 percent. Thus, such an 

employer is subject to the controlled 

group consistency rule with respect to 

the multiple-employer plan and any 

other plans subject to section 430 

maintained by that employer (or any 

member of that employer’s controlled 

group). By contrast, if the proportion of 

the multiple-employer plan’s funding 

target attributable to the employees and 

former employees of the employer and 

members of the employer’s controlled 

group is less than or equal to 50 percent, 

then that employer is not subject to the 

controlled group consistency rule with 

respect to the multiple-employer plan 

and any other plans subject to section 

430 maintained by that employer (and 

any member of that employer’s 

controlled group). 


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27However, if the experience study is used to 

demonstrate a lack of credible mortality 

information, the experience study period may be 

shorter than required under the otherwise 

applicable rules only if it starts on the date the plan 

becomes a newly-affiliated plan. 

28Those mortality tables must be based on the 

actual mortality experience of pension plan 

2. Option To Use Combined Male and 

Female Mortality Experience 

Some commenters requested the 

ability to develop and use substitute 

mortality tables based on the combined 

experience of both males and females in 

the plan, to increase the credibility of 

mortality experience for a smaller 

population. Treasury and the IRS have 

determined that this approach is 

consistent with established actuarial 

credibility theory. Accordingly, the final 

regulations provide that a single 

mortality ratio may be developed for 

both genders and then used to construct 

separate gender-specific base substitute 

mortality tables for the plan. If this 

option is applied for a plan, then 

substitute mortality tables used for all 

plans in the plan sponsor’s controlled 

group must be constructed in this 

manner (except for plans for which both 

the male and female populations, 

considered separately, have mortality 

experience with full credibility). In 

addition, if this option is applied for a 

plan, then the mortality experience for 

both genders must be combined for all 

other purposes under the regulations, 

including the determination of: (1) 

Whether a plan has credible mortality 

information for purposes of the 

controlled group consistency 

requirement; (2) whether the mortality 

experience for a plan has full 

credibility; and (3) the partial credibility 

weighting factor. 

3. Special Rules for Newly-Affiliated 

Plans 

The proposed regulations provide for 

a transition period during which the 

controlled group consistency 

requirement does not apply with respect 

to a newly-affiliated plan (that is, a plan 

that has become maintained within the 

new controlled group in connection 

with a transaction described in 

§ 1.410(b)–2(f)). In response to 

comments, the final regulations extend 

the transition period during which the 

controlled group consistency 

requirement does not apply with respect 

to a newly-affiliated plan so that it ends 

on the last day of the plan year that 

immediately follows the period 

described in section 410(b)(6)(C)(ii) for 

any of the plans in the controlled group 

(whichever ends latest). For example, if 

all of the plans involved have a plan 

year that is the calendar year and a 

corporate transaction occurs during 

2017, then the transition period during 

which the controlled group consistency 

requirement does not apply ends on 

December 31, 2019 (the end of the plan 

year that immediately follows December 

31, 2018, which is the end of the period 

described in section 410(b)(6)(C)(ii)). 

This longer transition period will ensure 

that the plan sponsor has adequate time 

to complete an experience study 

covering the newly-affiliated plan for 

use in its submission for approval of 

substitute mortality tables for a plan 

year beginning January 1, 2020. As 

under the proposed regulations, the 

final regulations provide that this 

experience study may exclude the preaffiliation data and the experience study 

period may be as short as 1 year (instead 

of 2 years). Therefore, under the facts of 

this example, the experience study used 

to develop substitute mortality tables for 

the plan may cover only calendar year 

2018.27

4. Early Termination of Use of 

Substitute Mortality Tables and 

Transition Rule 

The final regulations retain the rules 

from the 2008 substitute mortality table 

regulations regarding the termination of 

use of substitute mortality tables before 

their originally scheduled expiration. 

Among the circumstances that lead to 

early termination is the replacement of 

the generally applicable mortality tables 

(other than annual updates to the static 

mortality tables or changes to the 

mortality improvement rates). 

In response to comments, the final 

regulations include a transition rule 

under which previously approved base 

substitute mortality tables continue to 

apply for plan years beginning in 2018 

(assuming that plan year is covered by 

the original approval and that substitute 

mortality tables are used by all of the 

plans within the controlled group that 

have credible mortality experience 

under the standards in the 2008 

substitute mortality table regulations). 

In addition, previously approved base 

substitute mortality tables continue to 

apply to later plan years during the term 

of their original approval, provided that 

the plan sponsor satisfies the 

requirement that substitute mortality 

tables be used for all plans in the 

controlled group that have credible 

mortality information under the 

standards in these regulations. However, 

the mortality improvement rates under 

the final regulations, rather than the 

Scale AA Projection Factors (which 

were used under the 2008 substitute 

mortality table regulations), must be 

applied to previously approved base 

substitute mortality tables beginning in 

2019. 

G. Effective Date 

These regulations regarding substitute 

mortality tables apply to plan years 

beginning on or after January 1, 2018, 

subject to certain transition relief. In 

addition to the transition relief for 

previously approved base mortality 

tables described in section III.F.4 of the 

Explanation of Provisions portion of this 

preamble, the requirement that a plan 

sponsor apply for approval to use 

substitute mortality tables at least 7 

months before the beginning of the plan 

year will be treated as satisfied if the 

plan sponsor’s application is submitted 

on or before February 28, 2018, 

provided that the plan sponsor agrees to 

a 90-day extension of the 180-day 

review period. 

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 Web site at www.irs.gov. 

Special Analyses 

Regulatory Planning and Review 

(Executive Orders 12866 and 13563) 

It has been determined that these 

regulations constitute a significant 

regulatory action as defined in 

Executive Order 12866, as 

supplemented by Executive Order 

13563. Accordingly, these rules have 

been reviewed by the Office of 

Management and Budget. The 

Regulatory Impact Assessment prepared 

by Treasury for these regulations is 

provided below. This rule is not subject 

to the requirements of Executive Order 

13771 because this rule results in no 

more than de minimis costs. 

1. Description of Need for the 

Regulations 

Section 430 of the Internal Revenue 

Code specifies the minimum funding 

requirements that apply generally to 

defined benefit plans that are not 

multiemployer plans. Section 430(h)(3) 

contains rules regarding the mortality 

tables to be used under section 430. 

Under section 430(h)(3)(A), the 

Secretary is to prescribe by regulation 

mortality tables to be used in 

determining any present value or 

making any computation under section 

430.28 Under section 430(h)(3)(B), the 


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participants and projected trends in that 

experience. In prescribing those mortality tables, 

the Secretary is required to take into account results 

of available independent studies of mortality of 

individuals covered by pension plans. 

29The present values are discounted to the 

beginning of 2019. 

Secretary is required to revise any 

mortality table in effect under section 

430(h)(3)(A) at least every 10 years to 

reflect actual mortality experience of 

pension plan participants and projected 

trends in that experience. 

Section 430(h)(3)(C) prescribes rules 

for a plan sponsor’s use of substitute 

mortality tables reflecting the specific 

mortality experience of a plan’s 

population. Section 503 of the 

Bipartisan Budget Act of 2015 requires 

certain changes in the rules for 

developing a plan’s substitute mortality 

tables. 

The existing regulations regarding 

mortality tables were issued in 2008, for 

use beginning in 2008. Those tables 

were based on a study of mortality 

experience of pension plan participants 

covering the years 1990–1994 that was 

published in 2000. Since that time, 

studies have shown that people are 

living longer. For example, a study that 

RPEC published in 2014 indicates that 

the mortality tables issued under the 

2008 general mortality table regulations 

no longer reflect the actual mortality 

experience of pension plan participants 

and projected trends in that experience. 

In accordance with section 430(h)(3)(B), 

the Secretary is required to revise the 

mortality tables in the existing 

regulations as a result of these changes 

in the actual mortality experience and 

projected trends in that experience. In 

addition, changes in the existing 

regulations regarding substitute 

mortality tables are required under the 

provisions of the Bipartisan Budget Act 

of 2015. 

2. Affected Population 

The final regulations affect 

participants in private-sector defined 

benefit plans and employers sponsoring 

those plans. 

3. Baseline and Summary of Impacts 

As required by OMB Circular A–4, the 

following table summarizes the 

estimated economic impact of the final 

regulations. The baseline for this 

estimate is the mortality tables issued 

under the existing regulations. Because 

the new tables reflect the fact that 

participants are living longer, the 

primary impact of the final regulations 

is to increase the reported liability for 

future benefit payments from pension 

plans; this higher reported liability will 

result in higher pension contributions. 

The higher liability will also result in an 

increase in PBGC premiums, which are 

a function of a plan’s funded status. 

Because pension contributions and 

premiums are deductible from firms’ 

incomes, tax revenues will fall. 

As described in the effective date 

discussion in section II.D of the 

Explanation of Provisions portion of this 

preamble, these regulations include an 

option for a plan sponsor that is not 

using plan-specific mortality tables to 

delay the application of the new tables 

in certain circumstances. Because it is 

difficult to predict how many plan 

sponsors will utilize this option, the 

following tables provide a range of 

estimates of the economic impact of 

these regulations. The first row of 

numbers in the tables, labeled ‘‘full 

take-up amount,’’ is based on the 

assumption that all plan sponsors will 

use the option to delay the application 

of the new mortality tables; the second 

row of numbers, labeled ‘‘no take-up 

amount,’’ is based on the assumption 

that no plan sponsors will use the 

option to delay application of the new 

mortality tables. As noted in the 

effective date discussion in section II.D 

of the Explanation of Provisions portion 

of this preamble, the use of this option 

will not affect the mortality table used 

to determine minimum present value 

under section 417(e). 

Year 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 

Estimated change in tax revenue (in millions of 2017 dollars) 

Full take-up amount .................................. 0 ¥123 ¥499 ¥914 ¥1,170 ¥1,278 ¥1,216 ¥1,081 ¥807 ¥353 

No take-up amount ................................... ¥84 ¥362 ¥717 ¥1,025 ¥1,241 ¥1,314 ¥1,238 ¥1,042 ¥604 ¥228 

Present Value 29 with full take-up of delay option (3% Discount Rate): ¥$6,372 million 

Present Value with no take-up of delay option (3% Discount Rate): ¥$6,821 million 

Present Value with full take-up of delay option (7% Discount Rate): ¥$5,245 million 

Present Value with no take-up of delay option (7% Discount Rate): ¥$5,718 million 

Annualized Estimate with full take-up of delay option (3% Discount Rate): ¥$747 million 

Annualized Estimate with no take-up of delay option (3% Discount Rate): ¥$800 million 

Annualized Estimate with full take-up of delay option (7% Discount Rate): ¥$747 million 

Annualized Estimate with no take-up of delay option (7% Discount Rate): ¥$814 million 

Estimated change in contributions (in millions of 2017 dollars) 

Full take-up amount .................................. 0 2,933 4,873 6,071 6,574 6,069 5,322 3,667 750 407 

No take-up amount ................................... 2,151 3,631 5,418 6,391 6,694 6,194 5.373 1,751 815 797 

Present Value with full take-up of delay option (3% Discount Rate): $32,417 million 

Present Value with no take-up of delay option (3% Discount Rate): $35,100 million 

Present Value with full take-up of delay option (7% Discount Rate): $27,784 million 

Present Value with no take-up of delay option (7% Discount Rate): $30,595 million 

Annualized Estimate with full take-up of delay option (3% Discount Rate): $3,800 million 

Annualized Estimate with no take-up of delay option (3% Discount Rate): $4,115 million 

Annualized Estimate with full take-up of delay option (7% Discount Rate): $3,956 million 

Annualized Estimate with no take-up of delay option (7% Discount Rate): $4,356 million 

Estimated change in PBGC premiums (in millions of 2017 dollars) 

Full take-up amount .................................. 0 293 287 187 91 0 0 0 0 81 

No take-up amount ................................... 293 287 280 183 89 0 0 0 0 80 

Present Value with full take-up of delay option (3% Discount Rate): 869 million 

Present Value with no take-up of delay option (3% Discount Rate): 1,143 million 

Present Value with full take-up of delay option (7% Discount Rate): $791 million 

Present Value with no take-up of delay option (7% Discount Rate): $1,067 million 

Annualized Estimate with full take-up of delay option (3% Discount Rate): $102 million 


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46398 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 

30The optional annuity may be smaller because, 

when converting the lump sum in which the 

participant’s benefit is stated under the plan to an 

stream of annuity payments for the life of the 

participant (and the life of the participant’s spouse 

if applicable), the lifetime(s) over which the 

payments must be paid will generally be assumed 

to be longer if the new tables are used for this 

purpose rather than the prior tables. To pay a fixed 

sum over a longer period, the amount of the 

periodic payments must be reduced. However, a 

plan is not required to use these tables for this 

purpose and a recent study indicates that relatively 

few participants take an annuity distribution from 

plans with lump sum based benefit formulas See 

Sudipto Banerjee, Ph.D., Employee Benefits 

Research Institute, Issue Brief: Annuity and LumpSum Decisions in Defined Benefit Plans: The Role 

of Plan Rules, January 2013, available at https://

www.ebri.org/pdf/briefspdf/EBRI_IB_01- 

13.No381.LSDs2.pdf. 

Year 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 

Annualized Estimate with no take-up of delay option (3% Discount Rate): $134 million 

Annualized Estimate with full take-up of delay option (7% Discount Rate): $113 million 

Annualized Estimate with no take-up of delay option (7% Discount Rate): $152 million 

For pension payments that are paid 

over a retiree’s lifetime, the actual 

liability will depend on how long the 

retiree actually lives, and the impact of 

reflecting longer life expectancies in the 

calculation of present values under 

these regulations will merely accelerate 

the time when additional contributions 

attributable to longer lifetimes will need 

to be made. For pension payments that 

are lump-sum settlements in lieu of 

lifetime payments, the new tables will 

increase the amount of the lump sum. 

If the plan has a lump sum-based benefit 

formula, such as a cash balance plan, 

there will be no impact on the amount 

of a lump sum, but the optional annuity 

may be smaller.30 However, it is 

difficult to quantify the impact of these 

changes. 

4. Cost Associated With the Regulation 

Substantially all of the amounts 

involved (decreased tax revenue, 

increased plan contributions and PBGC 

premiums) constitute transfer payments, 

rather than costs. This is because these 

amounts are monetary payments from 

one entity to another that do not affect 

total resources available to society. 

We believe that the incremental 

administrative costs to implement this 

regulation are negligible, because plan 

sponsors would have to incur the same 

costs to update their plan 

administration software to reflect the 

new mortality tables under these 

regulations as they would incur in 

implementing the annual update to the 

mortality tables that would apply in the 

absence of these regulations. Moreover, 

the specific mortality rates used to 

calculate benefits for individuals 

normally are not provided to individual 

plan participants, so there will be no 

need to distribute information about the 

new mortality tables. Rather, plan 

sponsors and administrators provide 

individual participants who are 

considering retiring in the near future 

with individualized estimates of their 

benefits and that process is not 

dependent on the specific mortality 

rates used to determine benefits under 

the plan. Furthermore, Treasury and the 

IRS are issuing these regulations at a 

similar time of year as mortality tables 

were issued in prior years (and close in 

time to the issuance of the earliest 

interest rates that may be used in 

calculating the amount of a lump sum 

benefit to be distributed during a plan 

year beginning in 2018). In other words, 

these costs are included in the baseline 

of the analysis, not as new incremental 

costs associated with this rulemaking. 

In terms of the use of the mortality 

tables for purposes of applying the 

funding requirements of section 430, 

these regulations (like the current 

regulations) permit actuaries to use 

static mortality tables that approximate 

the present value determined using the 

generational mortality tables. Even if a 

plan’s actuary chooses to use 

generational mortality tables (including 

plan-specific mortality tables) instead of 

the static mortality tables, actuarial 

software capable of applying that 

approach (including generational 

mortality tables determined using 

mortality improvement rates that vary 

by both age and calendar year) should 

be readily available, as such 

generational mortality tables determined 

using varying mortality improvement 

rates have been used routinely for 

financial reporting purposes by large 

employers since the Mortality 

Improvement Scale MP–2014 Report 

was issued in 2014. In addition, these 

regulations permit any previously 

approved plan-specific mortality tables 

to continue to be used for the duration 

of the original approval period. 

Accordingly, any additional cost as a 

result of the issuance of these 

regulations should be negligible. 

Regulatory Flexibility Act (5 U.S.C. 

Chapter 6) 

It is hereby certified that this rule will 

not have a significant economic impact 

on a substantial number of small 

entities. This rule applies to all 

employers that sponsor defined benefit 

plans regardless of size. As stated above, 

this rule implements the statutorilyrequired updates and any compliance 

costs related to this rule are small and 

are consistent with previously issued 

annual updates. 

Pursuant to section 7805(f) of the 

Internal Revenue Code, the notice of 

proposed rulemaking preceding these 

regulations was submitted to the Chief 

Counsel for Advocacy of the Small 

Business Administration for comment 

on its impact on small business. 

Drafting Information 

The principal authors of these 

regulations are Arslan Malik and Linda 

S.F. Marshall of the Office of Associate 

Chief Counsel (Tax Exempt and 

Government Entities). However, other 

personnel from Treasury and the IRS 

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, 26 CFR part 1 is 

amended 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 1.430(h)(3)–1 is 

revised to read as follows: 

§ 1.430(h)(3)–1 Mortality tables used to 

determine present value. 

(a) Basis for mortality tables—(1) In 

general. Pursuant to section 

430(h)(3)(A), this section provides 

generally applicable mortality tables 

that are used to determine present value 

for purposes of section 430, and rules 

regarding the use of those mortality 

tables. Either the generational mortality 

tables under paragraph (a)(2) of this 

section or the static mortality tables 

under paragraph (a)(3) of this section 

may be used for a plan. In lieu of using 

the mortality tables provided under this 

section, plan-specific substitute 

mortality tables may be used pursuant 

to section 430(h)(3)(C), provided that 

the requirements of § 1.430(h)(3)–2 are 

satisfied. Mortality tables that may be 

used with respect to disabled 


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individuals are provided in guidance 

published in the Internal Revenue 

Bulletin. See § 601.601(d)(2)(ii)(b) of 

this chapter. 

(2) Generational mortality tables—(i) 

In general—(A) Use of generational 

mortality tables. The generational 

mortality tables that are permitted to be 

used under section 430(h)(3)(A) and 

paragraph (a)(1) of this section are 

determined using the base mortality 

tables described in paragraph (a)(2)(i)(B) 

of this section and the mortality 

improvement rates described in 

paragraph (a)(2)(i)(C) of this section. 

(B) Base mortality tables. The base 

mortality tables are set forth in 

paragraph (d) of this section. The base 

year for those tables is 2006. 

(C) Mortality improvement rates. The 

mortality improvement rates for 

valuation dates occurring during 2018 

are the mortality improvement rates 

contained in the Mortality Improvement 

Scale MP–2016 Report (issued by the 

Retirement Plans Experience Committee 

(RPEC) of the Society of Actuaries and 

available at www.soa.org/Research/ 

Experience-Study/Pension/research2016-mp.aspx). For later years, updated 

mortality improvement rates that take 

into account new data for mortality 

improvement trends of the general 

population will be provided in guidance 

published in the Internal Revenue 

Bulletin. See § 601.601(d)(2)(ii)(b) of 

this chapter. 

(D) Application of mortality 

improvement rates. Under the 

generational mortality tables described 

in this paragraph (a)(2), the probability 

of an individual’s death at a particular 

age in the future is determined as the 

individual’s base mortality rate that 

applies at that age (that is, the 

applicable mortality rate from the table 

set forth in paragraph (d) of this section 

for that age, gender, and status as an 

annuitant or a nonannuitant) multiplied 

by the cumulative mortality 

improvement factor for the individual’s 

gender and for that age for the period 

from 2006 through the calendar year in 

which the individual is projected to 

reach the particular age. Paragraph 

(a)(2)(ii) of this section shows how the 

base mortality tables in paragraph (d) of 

this section and the mortality 

improvement rates for valuation dates 

occurring during 2018 are combined to 

determine projected mortality rates. 

(E) Cumulative mortality 

improvement factor. The cumulative 

mortality improvement factor for an age 

and gender for a period is the product 

of the annual mortality improvement 

factors for that age and gender for each 

year within that period. 

(F) Annual mortality improvement 

factor. The annual mortality 

improvement factor for an age and 

gender for a year is 1 minus the 

mortality improvement rate that applies 

for that age and gender for that year. 

(ii) Example of calculation—(A) 

Calculation of mortality rate. The 

mortality rate for 2018 that is applied to 

male annuitants who are age 66 in 2018 

is equal to the product of the mortality 

rate for 2006 that applied to male 

annuitants who were age 66 in 2006 

(0.013855) and the cumulative mortality 

improvement factor for age 66 males 

from 2006 to 2018. The cumulative 

mortality improvement factor for age 66 

males for the period from 2006 to 2018 

is 0.8929, and the mortality rate for 2018 

for male annuitants who are age 66 in 

that year would be 0.012371, as shown 

in the following table. 

Calendar year 

Scale MP– 

2016 mortality 

improvement 

rate 

Annual 

mortality 

improvement 

factor 

(1- scale MP– 

2016 rate) 

Cumulative 

mortality 

improvement 

factor 

Mortality rate 

2006 ................................................................................................................. n/a n/a n/a 0.013855 

2007 ................................................................................................................. 0.0237 0.9763 0.9763 ........................

2008 ................................................................................................................. 0.0211 0.9789 0.9557 ........................

2009 ................................................................................................................. 0.0180 0.9820 0.9385 ........................

2010 ................................................................................................................. 0.0142 0.9858 0.9252 ........................

2011 ................................................................................................................. 0.0099 0.9901 0.9160 ........................

2012 ................................................................................................................. 0.0053 0.9947 0.9112 ........................

2013 ................................................................................................................. 0.0043 0.9957 0.9072 ........................

2014 ................................................................................................................. 0.0035 0.9965 0.9041 ........................

2015 ................................................................................................................. 0.0030 0.9970 0.9014 ........................

2016 ................................................................................................................. 0.0028 0.9972 0.8988 ........................

2017 ................................................................................................................. 0.0030 0.9970 0.8961 ........................

2018 ................................................................................................................. 0.0036 0.9964 0.8929 0.012371 

(B) Probability of survival for an 

individual. After the projected mortality 

rates are derived for each age for each 

year, the rates are used to calculate the 

present value of a benefit stream that 

depends on the probability of survival 

year-by-year. For example, for purposes 

of calculating the present value (for a 

2018 valuation date) of future payments 

in a benefit stream payable for a male 

annuitant who is age 66 in 2018, the 

probability of survival for the annuitant 

is based on the mortality rate for a male 

annuitant who is age 66 in 2018 

(0.012371), and the projected mortality 

rate for a male annuitant who will be 

age 67 in 2019 (0.013302), age 68 in 

2020 (0.014321), and so on. 

(3) Static mortality tables. The static 

mortality tables that are permitted to be 

used under section 430(h)(3)(A) and 

paragraph (a)(1) of this section are 

updated annually by the IRS according 

to the methodology described in 

paragraph (c)(2) of this section. 

Paragraph (e) of this section sets forth 

static tables that are permitted to be 

used for valuation dates in 2018. For 

valuation dates in later years, static 

mortality tables will be provided in 

guidance published in the Internal 

Revenue Bulletin. See 

§ 601.601(d)(2)(ii)(b) of this chapter. 

(b) Use of the tables—(1) Separate 

tables for annuitants and 

nonannuitants—(i) In general. Separate 

tables are provided for use for 

annuitants and nonannuitants. The 

nonannuitant mortality table is applied 

to determine the probability of survival 

for a nonannuitant for the period before 

the nonannuitant is projected to 

commence receiving benefits. The 

annuitant mortality table is applied to 

determine the present value of benefits 

for each annuitant. In addition, the 

annuitant mortality table is applied for 

each nonannuitant with respect to each 

assumed commencement of benefits for 

the period beginning with that assumed 


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46400 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 

commencement. For purposes of this 

section, an annuitant means a plan 

participant who has commenced 

receiving benefits, and a nonannuitant 

means a plan participant who has not 

yet commenced receiving benefits (for 

example, an active employee or a 

terminated vested participant). A 

participant whose benefit has partially 

commenced is treated as an annuitant 

with respect to the portion of the benefit 

that has commenced and treated as a 

nonannuitant with respect to the 

balance of the benefit. In addition, with 

respect to a beneficiary of a participant, 

the annuitant mortality table applies for 

the period beginning with each assumed 

commencement of benefits for the 

participant. If the participant has died 

(or to the extent the participant is 

assumed to die before commencing 

benefits), the annuitant mortality table 

applies with respect to the beneficiary 

for the period beginning with each 

assumed commencement of benefits for 

the beneficiary. 

(ii) Examples of calculation using 

separate annuitant and nonannuitant 

tables. With respect to a 45-year-old 

active participant who is projected to 

commence receiving an annuity at age 

55, the funding target is determined 

using the nonannuitant mortality table 

for the period before the participant 

attains age 55 (so that, if the static 

mortality tables are used pursuant to 

paragraph (a)(3) of this section, the 

probability of an active male participant 

living from age 45 to age 55 using the 

table that applies for a valuation date in 

2018 is 0.988857) and using the 

annuitant mortality table for the period 

ages 55 and above. Similarly, for a 45- 

year-old terminated vested participant 

who is projected to commence an 

annuity at age 65, the funding target is 

determined using the nonannuitant 

mortality table for the period before the 

participant attains age 65 and using the 

annuitant mortality table for ages 65 and 

above. 

(2) Small plan tables. If static 

mortality tables are used pursuant to 

paragraph (a)(3) of this section, as an 

alternative to the separate static tables 

specified for annuitants and 

nonannuitants pursuant to paragraph 

(b)(1) of this section, combined static 

tables that apply the same mortality 

rates to both annuitants and 

nonannuitants are permitted to be used 

for a small plan. For this purpose, a 

small plan is defined as a plan with 500 

or fewer total participants (including 

both active and inactive participants 

and beneficiaries of deceased 

participants) on the valuation date. The 

combined static tables that are 

permitted to be used for small plans 

pursuant to this paragraph (b)(2) are 

constructed from the separate 

nonannuitant and annuitant static 

mortality tables using the weighting 

factors for small plans that are set forth 

in paragraph (d) of this section. The 

weighting factors are applied to develop 

these combined static tables using the 

following equation: Combined mortality 

rate = [nonannuitant rate * (1 ¥ 

weighting factor)] + [annuitant rate * 

weighting factor]. 

(c) Static tables—(1) Source of rates. 

The static mortality tables that are used 

pursuant to paragraph (a)(3) of this 

section are determined using the base 

mortality tables described in paragraph 

(a)(2)(i)(B) of this section taking into 

account the mortality improvement 

rates described in paragraph (a)(2)(i)(C) 

of this section, in accordance with the 

rules of paragraph (c)(3) of this section. 

(2) Selection of static tables. The 

static mortality tables that are used for 

a valuation date are the static mortality 

tables for the calendar year that contains 

the valuation date. 

(3) Projection of mortality 

improvements—(i) General rule. Except 

as provided in paragraph (c)(3)(iii) of 

this section, the static mortality tables 

for a calendar year are determined by 

multiplying the applicable mortality 

rate for each age from the base mortality 

tables by both— 

(A) The cumulative mortality 

improvement factor (determined under 

the rules of paragraph (a)(2) of this 

section) for the period from 2006 

through that calendar year; and 

(B) The cumulative mortality 

improvement factor (determined under 

the rules of paragraph (a)(2) of this 

section) for the period beginning in that 

calendar year and continuing beyond 

that calendar year for the number of 

years in the projection period described 

in paragraph (c)(3)(ii) of this section. 

(ii) Projection period for static 

mortality tables—(A) In general. The 

projection period is 8 years for males 

and 9 years for females, as adjusted 

based on age as provided in paragraph 

(c)(3)(ii)(B) of this section. 

(B) Age adjustment. For ages below 

80, the projection period is increased by 

1 year for each year below age 80. For 

ages above 80, the projection period is 

reduced (but not below zero) by 1⁄3 year 

for each year above 80. 

(iii) Fractional projection periods. If 

for an age the number of years in the 

projection period determined under this 

paragraph (c)(3) is not a whole number, 

then the mortality rate for that age is 

determined by using linear interpolation 

between— 

(A) The mortality rate for that age that 

would be determined under paragraph 

(c)(3)(i) of this section if the number of 

years in the projection period were the 

next lower whole number; and 

(B) The mortality rate for that age that 

would be determined under paragraph 

(c)(3)(i) of this section if the number of 

years in the projection period were the 

next higher whole number. 

(iv) Example. The following example 

illustrates how the mortality rates in the 

static mortality tables issued under the 

provisions of this paragraph (c) are 

calculated: 

Example. At age 85, the projection period 

for a male is 61⁄3 years (8 years minus 1⁄3 year 

for each of the 5 years above age 80). For a 

valuation date in 2018, the mortality rate in 

the static mortality table for an 85-year-old 

male is based on a projection of mortality 

improvement for 61⁄3 years beyond 2018. 

Under paragraph (c)(3)(iii) of this section, the 

mortality rate for an 85-year-old male 

annuitant in the static mortality table for 

2018 is 2⁄3 times the projected mortality rate 

for a male annuitant that age in 2024 plus 1⁄3

times the projected mortality rate for a male 

annuitant that age in 2025. Accordingly, the 

mortality rate for an 85-year-old male 

annuitant in the static mortality table for 

2018 is 0.075196 (2⁄3 times the projected 

mortality rate for an 85-year old male 

annuitant in 2024 (0.075447) plus 1⁄3 times 

the projected mortality rate for an 85-year old 

male annuitant in 2025 (0.074693)). 

(d) Base mortality tables. The 

following are the base mortality tables. 

The base year for these tables is 2006. 

Age 

Males Females 

Non-annuitant Annuitant 

Weighting 

factor for small 

plans 

Non-annuitant Annuitant 

Weighting 

factor for small 

plans 

0 ............................................................... 0.008878 0.008878 0 0.007278 0.007278 0 

1 ............................................................... 0.000515 0.000515 0 0.000451 0.000451 0 

2 ............................................................... 0.000348 0.000348 0 0.000295 0.000295 0 

3 ............................................................... 0.000289 0.000289 0 0.000220 0.000220 0 


ethrower on DSK3G9T082PROD with RULES
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 46401 

Age 

Males Females 

Non-annuitant Annuitant 

Weighting 

factor for small 

plans 

Non-annuitant Annuitant 

Weighting 

factor for small 

plans 

4 ............................................................... 0.000225 0.000225 0 0.000165 0.000165 0 

5 ............................................................... 0.000197 0.000197 0 0.000149 0.000149 0 

6 ............................................................... 0.000177 0.000177 0 0.000137 0.000137 0 

7 ............................................................... 0.000156 0.000156 0 0.000127 0.000127 0 

8 ............................................................... 0.000132 0.000132 0 0.000117 0.000117 0 

9 ............................................................... 0.000107 0.000107 0 0.000109 0.000109 0 

10 ............................................................. 0.000090 0.000090 0 0.000102 0.000102 0 

11 ............................................................. 0.000095 0.000095 0 0.000105 0.000105 0 

12 ............................................................. 0.000142 0.000142 0 0.000121 0.000121 0 

13 ............................................................. 0.000187 0.000187 0 0.000137 0.000137 0 

14 ............................................................. 0.000230 0.000230 0 0.000151 0.000151 0 

15 ............................................................. 0.000274 0.000274 0 0.000165 0.000165 0 

16 ............................................................. 0.000318 0.000318 0 0.000177 0.000177 0 

17 ............................................................. 0.000364 0.000364 0 0.000187 0.000187 0 

18 ............................................................. 0.000412 0.000412 0 0.000196 0.000196 0 

19 ............................................................. 0.000463 0.000463 0 0.000202 0.000202 0 

20 ............................................................. 0.000510 0.000510 0 0.000202 0.000202 0 

21 ............................................................. 0.000552 0.000552 0 0.000197 0.000197 0 

22 ............................................................. 0.000587 0.000587 0 0.000191 0.000191 0 

23 ............................................................. 0.000599 0.000599 0 0.000190 0.000190 0 

24 ............................................................. 0.000594 0.000594 0 0.000188 0.000188 0 

25 ............................................................. 0.000545 0.000545 0 0.000186 0.000186 0 

26 ............................................................. 0.000510 0.000510 0 0.000186 0.000186 0 

27 ............................................................. 0.000486 0.000486 0 0.000188 0.000188 0 

28 ............................................................. 0.000472 0.000472 0 0.000192 0.000192 0 

29 ............................................................. 0.000468 0.000468 0 0.000198 0.000198 0 

30 ............................................................. 0.000470 0.000470 0 0.000209 0.000209 0 

31 ............................................................. 0.000480 0.000480 0 0.000222 0.000222 0 

32 ............................................................. 0.000495 0.000495 0 0.000238 0.000238 0 

33 ............................................................. 0.000514 0.000514 0 0.000257 0.000257 0 

34 ............................................................. 0.000534 0.000534 0 0.000278 0.000278 0 

35 ............................................................. 0.000557 0.000557 0 0.000301 0.000301 0 

36 ............................................................. 0.000581 0.000581 0 0.000325 0.000325 0 

37 ............................................................. 0.000611 0.000611 0 0.000355 0.000355 0 

38 ............................................................. 0.000648 0.000648 0 0.000389 0.000389 0 

39 ............................................................. 0.000694 0.000694 0 0.000428 0.000428 0 

40 ............................................................. 0.000750 0.000750 0 0.000471 0.000471 0 

41 ............................................................. 0.000814 0.000823 .0045 0.000518 0.000515 0 

42 ............................................................. 0.000890 0.000969 .0091 0.000570 0.000603 0 

43 ............................................................. 0.000982 0.001188 .0136 0.000628 0.000735 0 

44 ............................................................. 0.001088 0.001480 .0181 0.000691 0.000911 0 

45 ............................................................. 0.001207 0.001846 .0226 0.000758 0.001131 .0084 

46 ............................................................. 0.001342 0.002285 .0272 0.000831 0.001395 .0167 

47 ............................................................. 0.001487 0.002797 .0317 0.000908 0.001703 .0251 

48 ............................................................. 0.001643 0.003382 .0362 0.000986 0.002055 .0335 

49 ............................................................. 0.001807 0.004040 .0407 0.001065 0.002451 .0419 

50 ............................................................. 0.001979 0.004771 .0453 0.001151 0.002891 .0502 

51 ............................................................. 0.002159 0.005059 .0498 0.001242 0.002993 .0586 

52 ............................................................. 0.002351 0.005343 .0686 0.001344 0.003124 .0744 

53 ............................................................. 0.002539 0.005592 .0953 0.001458 0.003291 .0947 

54 ............................................................. 0.002741 0.005839 .1288 0.001588 0.003499 .1189 

55 ............................................................. 0.002967 0.006102 .2066 0.001735 0.003755 .1897 

56 ............................................................. 0.003231 0.006399 .3173 0.001902 0.004065 .2857 

57 ............................................................. 0.003548 0.006746 .3780 0.002091 0.004435 .3403 

58 ............................................................. 0.003932 0.007155 .4401 0.002302 0.004869 .3878 

59 ............................................................. 0.004396 0.007639 .4986 0.002537 0.005373 .4360 

60 ............................................................. 0.004954 0.008211 .5633 0.002795 0.005942 .4954 

61 ............................................................. 0.005616 0.008878 .6338 0.003080 0.006581 .5805 

62 ............................................................. 0.006392 0.009646 .7103 0.003388 0.007283 .6598 

63 ............................................................. 0.007291 0.010523 .7902 0.003724 0.008043 .7520 

64 ............................................................. 0.008320 0.011514 .8355 0.004089 0.008870 .8043 

65 ............................................................. 0.009486 0.012621 .8832 0.004482 0.009760 .8552 

66 ............................................................. 0.010668 0.013855 .9321 0.005004 0.010731 .9118 

67 ............................................................. 0.011973 0.015221 .9510 0.005575 0.011790 .9367 

68 ............................................................. 0.013414 0.016736 .9639 0.006205 0.012952 .9523 

69 ............................................................. 0.015006 0.018421 .9714 0.006898 0.014226 .9627 

70 ............................................................. 0.016761 0.020288 .9740 0.007662 0.015628 .9661 

71 ............................................................. 0.018690 0.022348 .9766 0.008507 0.017170 .9695 

72 ............................................................. 0.020824 0.024638 .9792 0.009438 0.018861 .9729 

73 ............................................................. 0.023176 0.027176 .9818 0.010470 0.020723 .9763 


ethrower on DSK3G9T082PROD with RULES
46402 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 

Age 

Males Females 

Non-annuitant Annuitant 

Weighting 

factor for small 

plans 

Non-annuitant Annuitant 

Weighting 

factor for small 

plans 

74 ............................................................. 0.025770 0.029992 .9844 0.011615 0.022780 .9797 

75 ............................................................. 0.028623 0.033113 .9870 0.012887 0.025057 .9830 

76 ............................................................. 0.031761 0.036585 .9896 0.014301 0.027590 .9864 

77 ............................................................. 0.035214 0.040457 .9922 0.015885 0.030438 .9898 

78 ............................................................. 0.039007 0.044778 .9948 0.017656 0.033653 .9932 

79 ............................................................. 0.043169 0.049605 .9974 0.019639 0.037296 .9966 

80 ............................................................. 0.047750 0.055022 1.0 0.021859 0.041440 1.0 

81 ............................................................. 0.049804 0.061087 1.0 0.023791 0.046181 1.0 

82 ............................................................. 0.053911 0.067902 1.0 0.027655 0.051564 1.0 

83 ............................................................. 0.060072 0.075550 1.0 0.033451 0.057714 1.0 

84 ............................................................. 0.068286 0.084162 1.0 0.041179 0.064709 1.0 

85 ............................................................. 0.078554 0.093775 1.0 0.050838 0.072601 1.0 

86 ............................................................. 0.090876 0.104507 1.0 0.062429 0.081490 1.0 

87 ............................................................. 0.105251 0.116487 1.0 0.075952 0.091444 1.0 

88 ............................................................. 0.121680 0.129770 1.0 0.091407 0.102470 1.0 

89 ............................................................. 0.140162 0.144470 1.0 0.108794 0.114635 1.0 

90 ............................................................. 0.160698 0.160698 1.0 0.128113 0.128113 1.0 

91 ............................................................. 0.177741 0.177741 1.0 0.142619 0.142619 1.0 

92 ............................................................. 0.195154 0.195154 1.0 0.157939 0.157939 1.0 

93 ............................................................. 0.212642 0.212642 1.0 0.173886 0.173886 1.0 

94 ............................................................. 0.230055 0.230055 1.0 0.190319 0.190319 1.0 

95 ............................................................. 0.247257 0.247257 1.0 0.207191 0.207191 1.0 

96 ............................................................. 0.265940 0.265940 1.0 0.225057 0.225057 1.0 

97 ............................................................. 0.284940 0.284940 1.0 0.243507 0.243507 1.0 

98 ............................................................. 0.304432 0.304432 1.0 0.262587 0.262587 1.0 

99 ............................................................. 0.324272 0.324272 1.0 0.282171 0.282171 1.0 

100 ........................................................... 0.344364 0.344364 1.0 0.302162 0.302162 1.0 

101 ........................................................... 0.364420 0.364420 1.0 0.322282 0.322282 1.0 

102 ........................................................... 0.384058 0.384058 1.0 0.342371 0.342371 1.0 

103 ........................................................... 0.403188 0.403188 1.0 0.362210 0.362210 1.0 

104 ........................................................... 0.421533 0.421533 1.0 0.381534 0.381534 1.0 

105 ........................................................... 0.438903 0.438903 1.0 0.400321 0.400321 1.0 

106 ........................................................... 0.455492 0.455492 1.0 0.418418 0.418418 1.0 

107 ........................................................... 0.470810 0.470810 1.0 0.435390 0.435390 1.0 

108 ........................................................... 0.484965 0.484965 1.0 0.451459 0.451459 1.0 

109 ........................................................... 0.498023 0.498023 1.0 0.466408 0.466408 1.0 

110 ........................................................... 0.509768 0.509768 1.0 0.480123 0.480123 1.0 

111 ........................................................... 0.512472 0.512472 1.0 0.492664 0.492664 1.0 

112 ........................................................... 0.509296 0.509296 1.0 0.503970 0.503970 1.0 

113 ........................................................... 0.506193 0.506193 1.0 0.507361 0.507361 1.0 

114 ........................................................... 0.503061 0.503061 1.0 0.503564 0.503564 1.0 

115 ........................................................... 0.500000 0.500000 1.0 0.500000 0.500000 1.0 

116 ........................................................... 0.500000 0.500000 1.0 0.500000 0.500000 1.0 

117 ........................................................... 0.500000 0.500000 1.0 0.500000 0.500000 1.0 

118 ........................................................... 0.500000 0.500000 1.0 0.500000 0.500000 1.0 

119 ........................................................... 0.500000 0.500000 1.0 0.500000 0.500000 1.0 

120 ........................................................... 1.000000 1.000000 1.0 1.000000 1.000000 1.0 

(e) Static tables for 2018. The 

following static mortality tables are used 

pursuant to paragraph (a)(3) of this 

section for determining present value or 

making any computation under section 

430 with respect to valuation dates 

occurring during 2018. 

Age 

Males Females 

Non-annuitant Annuitant 

Optional 

combined 

table for 

small plans 

Non-annuitant Annuitant 

Optional 

combined 

table for 

small plans 

0 ............................................................... 0.002420 0.002420 0.002420 0.002234 0.002234 0.002234 

1 ............................................................... 0.000142 0.000142 0.000142 0.000140 0.000140 0.000140 

2 ............................................................... 0.000097 0.000097 0.000097 0.000092 0.000092 0.000092 

3 ............................................................... 0.000081 0.000081 0.000081 0.000070 0.000070 0.000070 

4 ............................................................... 0.000064 0.000064 0.000064 0.000053 0.000053 0.000053 

5 ............................................................... 0.000056 0.000056 0.000056 0.000048 0.000048 0.000048 

6 ............................................................... 0.000051 0.000051 0.000051 0.000045 0.000045 0.000045 

7 ............................................................... 0.000046 0.000046 0.000046 0.000042 0.000042 0.000042 

8 ............................................................... 0.000039 0.000039 0.000039 0.000039 0.000039 0.000039 


ethrower on DSK3G9T082PROD with RULES
Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 46403 

Age 

Males Females 

Non-annuitant Annuitant 

Optional 

combined 

table for 

small plans 

Non-annuitant Annuitant 

Optional 

combined 

table for 

small plans 

9 ............................................................... 0.000032 0.000032 0.000032 0.000037 0.000037 0.000037 

10 ............................................................. 0.000027 0.000027 0.000027 0.000035 0.000035 0.000035 

11 ............................................................. 0.000029 0.000029 0.000029 0.000036 0.000036 0.000036 

12 ............................................................. 0.000044 0.000044 0.000044 0.000042 0.000042 0.000042 

13 ............................................................. 0.000058 0.000058 0.000058 0.000048 0.000048 0.000048 

14 ............................................................. 0.000072 0.000072 0.000072 0.000053 0.000053 0.000053 

15 ............................................................. 0.000087 0.000087 0.000087 0.000059 0.000059 0.000059 

16 ............................................................. 0.000102 0.000102 0.000102 0.000064 0.000064 0.000064 

17 ............................................................. 0.000118 0.000118 0.000118 0.000068 0.000068 0.000068 

18 ............................................................. 0.000135 0.000135 0.000135 0.000072 0.000072 0.000072 

19 ............................................................. 0.000153 0.000153 0.000153 0.000075 0.000075 0.000075 

20 ............................................................. 0.000170 0.000170 0.000170 0.000076 0.000076 0.000076 

21 ............................................................. 0.000192 0.000192 0.000192 0.000078 0.000078 0.000078 

22 ............................................................. 0.000214 0.000214 0.000214 0.000080 0.000080 0.000080 

23 ............................................................. 0.000229 0.000229 0.000229 0.000084 0.000084 0.000084 

24 ............................................................. 0.000238 0.000238 0.000238 0.000087 0.000087 0.000087 

25 ............................................................. 0.000230 0.000230 0.000230 0.000090 0.000090 0.000090 

26 ............................................................. 0.000226 0.000226 0.000226 0.000094 0.000094 0.000094 

27 ............................................................. 0.000226 0.000226 0.000226 0.000099 0.000099 0.000099 

28 ............................................................. 0.000230 0.000230 0.000230 0.000105 0.000105 0.000105 

29 ............................................................. 0.000238 0.000238 0.000238 0.000111 0.000111 0.000111 

30 ............................................................. 0.000249 0.000249 0.000249 0.000120 0.000120 0.000120 

31 ............................................................. 0.000263 0.000263 0.000263 0.000130 0.000130 0.000130 

32 ............................................................. 0.000278 0.000278 0.000278 0.000142 0.000142 0.000142 

33 ............................................................. 0.000294 0.000294 0.000294 0.000155 0.000155 0.000155 

34 ............................................................. 0.000309 0.000309 0.000309 0.000168 0.000168 0.000168 

35 ............................................................. 0.000323 0.000323 0.000323 0.000182 0.000182 0.000182 

36 ............................................................. 0.000336 0.000336 0.000336 0.000196 0.000196 0.000196 

37 ............................................................. 0.000350 0.000350 0.000350 0.000213 0.000213 0.000213 

38 ............................................................. 0.000366 0.000366 0.000366 0.000231 0.000231 0.000231 

39 ............................................................. 0.000385 0.000385 0.000385 0.000251 0.000251 0.000251 

40 ............................................................. 0.000410 0.000410 0.000410 0.000273 0.000273 0.000273 

41 ............................................................. 0.000438 0.000443 0.000438 0.000298 0.000296 0.000298 

42 ............................................................. 0.000474 0.000516 0.000474 0.000326 0.000344 0.000326 

43 ............................................................. 0.000518 0.000627 0.000519 0.000358 0.000419 0.000358 

44 ............................................................. 0.000573 0.000779 0.000577 0.000395 0.000520 0.000395 

45 ............................................................. 0.000636 0.000973 0.000644 0.000436 0.000651 0.000438 

46 ............................................................. 0.000712 0.001213 0.000726 0.000484 0.000813 0.000489 

47 ............................................................. 0.000798 0.001502 0.000820 0.000538 0.001010 0.000550 

48 ............................................................. 0.000896 0.001844 0.000930 0.000597 0.001245 0.000619 

49 ............................................................. 0.001005 0.002248 0.001056 0.000661 0.001522 0.000697 

50 ............................................................. 0.001128 0.002719 0.001200 0.000734 0.001844 0.000790 

51 ............................................................. 0.001265 0.002963 0.001350 0.000814 0.001961 0.000881 

52 ............................................................. 0.001418 0.003224 0.001542 0.000903 0.002099 0.000992 

53 ............................................................. 0.001580 0.003481 0.001761 0.001003 0.002263 0.001122 

54 ............................................................. 0.001761 0.003751 0.002017 0.001114 0.002454 0.001273 

55 ............................................................. 0.001964 0.004040 0.002393 0.001235 0.002673 0.001508 

56 ............................................................. 0.002200 0.004357 0.002884 0.001367 0.002921 0.001811 

57 ............................................................. 0.002474 0.004704 0.003317 0.001509 0.003200 0.002084 

58 ............................................................. 0.002796 0.005088 0.003805 0.001661 0.003512 0.002379 

59 ............................................................. 0.003174 0.005515 0.004341 0.001823 0.003860 0.002711 

60 ............................................................. 0.003613 0.005989 0.004951 0.001994 0.004238 0.003106 

61 ............................................................. 0.004122 0.006516 0.005639 0.002181 0.004659 0.003619 

62 ............................................................. 0.004705 0.007100 0.006406 0.002381 0.005119 0.004188 

63 ............................................................. 0.005364 0.007742 0.007243 0.002600 0.005616 0.004868 

64 ............................................................. 0.006111 0.008457 0.008071 0.002842 0.006165 0.005515 

65 ............................................................. 0.006940 0.009234 0.008966 0.003107 0.006766 0.006236 

66 ............................................................. 0.007779 0.010103 0.009945 0.003465 0.007430 0.007080 

67 ............................................................. 0.008697 0.011056 0.010940 0.003863 0.008170 0.007897 

68 ............................................................. 0.009709 0.012114 0.012027 0.004308 0.008993 0.008770 

69 ............................................................. 0.010836 0.013302 0.013231 0.004806 0.009912 0.009722 

70 ............................................................. 0.012093 0.014637 0.014571 0.005366 0.010945 0.010756 

71 ............................................................. 0.013486 0.016126 0.016064 0.006001 0.012111 0.011925 

72 ............................................................. 0.015044 0.017799 0.017742 0.006711 0.013412 0.013230 

73 ............................................................. 0.016794 0.019693 0.019640 0.007521 0.014886 0.014711 

74 ............................................................. 0.018751 0.021823 0.021775 0.008439 0.016552 0.016387 

75 ............................................................. 0.020950 0.024237 0.024194 0.009485 0.018443 0.018291 

76 ............................................................. 0.023428 0.026986 0.026949 0.010678 0.020600 0.020465 

77 ............................................................. 0.026183 0.030081 0.030051 0.012035 0.023061 0.022949 

78 ............................................................. 0.029308 0.033645 0.033622 0.013582 0.025888 0.025804 


ethrower on DSK3G9T082PROD with RULES
46404 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 

Age 

Males Females 

Non-annuitant Annuitant 

Optional 

combined 

table for 

small plans 

Non-annuitant Annuitant 

Optional 

combined 

table for 

small plans 

79 ............................................................. 0.032774 0.037661 0.037648 0.015347 0.029144 0.029097 

80 ............................................................. 0.036705 0.042295 0.042295 0.017347 0.032886 0.032886 

81 ............................................................. 0.038556 0.047291 0.047291 0.019058 0.036992 0.036992 

82 ............................................................. 0.042087 0.053009 0.053009 0.022345 0.041662 0.041662 

83 ............................................................. 0.047283 0.059466 0.059466 0.027251 0.047017 0.047017 

84 ............................................................. 0.054248 0.066860 0.066860 0.033811 0.053130 0.053130 

85 ............................................................. 0.062990 0.075196 0.075196 0.042053 0.060056 0.060056 

86 ............................................................. 0.073605 0.084646 0.084646 0.052009 0.067888 0.067888 

87 ............................................................. 0.086115 0.095308 0.095308 0.063725 0.076724 0.076724 

88 ............................................................. 0.100513 0.107196 0.107196 0.077205 0.086549 0.086549 

89 ............................................................. 0.116840 0.120431 0.120431 0.092462 0.097426 0.097426 

90 ............................................................. 0.135087 0.135087 0.135087 0.109484 0.109484 0.109484 

91 ............................................................. 0.150610 0.150610 0.150610 0.122541 0.122541 0.122541 

92 ............................................................. 0.166534 0.166534 0.166534 0.136397 0.136397 0.136397 

93 ............................................................. 0.182546 0.182546 0.182546 0.150811 0.150811 0.150811 

94 ............................................................. 0.198598 0.198598 0.198598 0.165818 0.165818 0.165818 

95 ............................................................. 0.214442 0.214442 0.214442 0.181360 0.181360 0.181360 

96 ............................................................. 0.232944 0.232944 0.232944 0.198746 0.198746 0.198746 

97 ............................................................. 0.251903 0.251903 0.251903 0.216930 0.216930 0.216930 

98 ............................................................. 0.271612 0.271612 0.271612 0.235921 0.235921 0.235921 

99 ............................................................. 0.291889 0.291889 0.291889 0.255617 0.255617 0.255617 

100 ........................................................... 0.312680 0.312680 0.312680 0.275938 0.275938 0.275938 

101 ........................................................... 0.333720 0.333720 0.333720 0.296628 0.296628 0.296628 

102 ........................................................... 0.354570 0.354570 0.354570 0.317471 0.317471 0.317471 

103 ........................................................... 0.375136 0.375136 0.375136 0.338385 0.338385 0.338385 

104 ........................................................... 0.395172 0.395172 0.395172 0.358868 0.358868 0.358868 

105 ........................................................... 0.413945 0.413945 0.413945 0.379183 0.379183 0.379183 

106 ........................................................... 0.432145 0.432145 0.432145 0.398878 0.398878 0.398878 

107 ........................................................... 0.449197 0.449197 0.449197 0.417703 0.417703 0.417703 

108 ........................................................... 0.465497 0.465497 0.465497 0.435384 0.435384 0.435384 

109 ........................................................... 0.480869 0.480869 0.480869 0.452108 0.452108 0.452108 

110 ........................................................... 0.495080 0.495080 0.495080 0.467928 0.467928 0.467928 

111 ........................................................... 0.500557 0.500557 0.500557 0.482562 0.482562 0.482562 

112 ........................................................... 0.500454 0.500454 0.500454 0.496164 0.496164 0.496164 

113 ........................................................... 0.500352 0.500352 0.500352 0.502110 0.502110 0.502110 

114 ........................................................... 0.500201 0.500201 0.500201 0.500952 0.500952 0.500952 

115 ........................................................... 0.500000 0.500000 0.500000 0.500000 0.500000 0.500000 

116 ........................................................... 0.500000 0.500000 0.500000 0.500000 0.500000 0.500000 

117 ........................................................... 0.500000 0.500000 0.500000 0.500000 0.500000 0.500000 

118 ........................................................... 0.500000 0.500000 0.500000 0.500000 0.500000 0.500000 

119 ........................................................... 0.500000 0.500000 0.500000 0.500000 0.500000 0.500000 

120 ........................................................... 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 

(f) Effective/applicability date—(1) In 

general. Except as provided in 

paragraph (f)(2) of this section, this 

section applies to plan years beginning 

or after January 1, 2018. 

(2) Option to apply prior regulations 

in certain circumstances. For a plan for 

which substitute mortality tables are not 

used pursuant to § 1.430(h)(3)–2 for a 

plan year beginning during 2018, 

mortality tables determined in 

accordance with § 1.430(h)(3)–1 as in 

effect on December 31, 2017 (as 

contained in 26 CFR part 1 revised April 

1, 2017) may be used for purposes of 

applying the rules of section 430 for a 

valuation date occurring during 2018 if 

the plan sponsor— 

(i) Concludes that the use of mortality 

tables determined in accordance with 

this section for the plan year would be 

administratively impracticable or would 

result in an adverse business impact 

that is greater than de minimis; and 

(ii) Informs the actuary of the intent 

to apply the option under this paragraph 

(f)(2). 

■ Par. 3. Section 1.430(h)(3)–2 is 

revised to read as follows: 

§ 1.430(h)(3)–2 Plan-specific substitute 

mortality tables used to determine present 

value. 

(a) In general. This section provides 

rules for the use of substitute mortality 

tables under section 430(h)(3)(C) in 

determining any present value or 

making any computation under section 

430 in accordance with § 1.430(h)(3)– 

1(a)(1). To use substitute mortality 

tables for a plan, a plan sponsor must 

first obtain approval to use the tables in 

accordance with the procedures 

described in paragraph (b) of this 

section. Paragraph (c) of this section 

provides rules for the development of 

substitute mortality tables, including 

guidelines providing that a plan must 

have either fully or partially credible 

mortality information in order to use 

substitute mortality tables. Paragraph (d) 

of this section describes the 

requirements for full credibility. 

Paragraph (e) of this section describes 

the requirements for partial credibility. 

Paragraph (f) of this section provides 

special rules for newly-affiliated plans. 

Paragraph (g) of this section specifies 

the effective date and applicability date 

of this section. The Commissioner may, 

in revenue rulings and procedures, 

notices, or other guidance published in 

the Internal Revenue Bulletin (see 

§ 601.601(d)(2)(ii)(b) of this chapter), 

provide additional guidance regarding 

approval and use of substitute mortality 


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tables under section 430(h)(3)(C) and 

related matters. 

(b) Procedures for obtaining approval 

to use substitute mortality tables—(1) 

Written request for approval to use 

substitute mortality tables—(i) General 

requirements. To use substitute 

mortality tables, a plan sponsor must 

first submit a written request to the 

Commissioner demonstrating that those 

substitute mortality tables meet the 

requirements of section 430(h)(3)(C) and 

this section. This request must specify 

the first plan year, and the term of years 

(not more than 10), for which the tables 

are to apply. 

(ii) Time for written request. 

Substitute mortality tables may not be 

used for a plan year unless the plan 

sponsor submits the written request 

described in paragraph (b)(1)(i) of this 

section at least 7 months before the first 

day of the first plan year for which the 

substitute mortality tables are to apply. 

(2) Commissioner’s review of 

request—(i) In general. During the 180- 

day period that begins on the date the 

plan sponsor submits a request for 

approval to use substitute mortality 

tables for a plan pursuant to this 

section, the Commissioner will 

determine whether the request for 

approval to use substitute mortality 

tables satisfies the requirements of this 

section (including any published 

guidance issued pursuant to paragraph 

(a) of this section), and will either 

approve or deny the request. The 

Commissioner will deny a request if the 

request fails to meet the requirements of 

this section or if the Commissioner 

determines that a substitute mortality 

table does not reflect the actual 

mortality experience of the applicable 

population. 

(ii) Request for additional 

information. The Commissioner may 

request additional information with 

respect to the submission and deny a 

request to use substitute mortality tables 

if the additional information is not 

provided in a timely manner. 

(iii) Deemed approval. Except as 

provided in paragraph (b)(2)(iv) of this 

section, if the Commissioner does not 

issue a denial within the 180-day review 

period, the request is deemed to have 

been approved. 

(iv) Extension of time permitted. The 

Commissioner and a plan sponsor may, 

before the expiration of the 180-day 

review period, agree in writing to 

extend that period. 

(c) Development of substitute 

mortality tables—(1) Substitute 

mortality tables must be used for all 

plans in controlled group—(i) General 

rule. Except as otherwise provided in 

this paragraph (c), substitute mortality 

tables are permitted to be used for a 

plan for a plan year only if, for that plan 

year (or any portion of that plan year), 

substitute mortality tables are also 

approved and used for each other 

pension plan subject to the 

requirements of section 430 that is 

maintained by the plan sponsor and by 

each member of the plan sponsor’s 

controlled group. For purposes of this 

section, the term controlled group 

means any group that is treated as a 

single employer under paragraph (b), 

(c), (m), or (o) of section 414. See 

paragraph (c)(7) of this section for 

special rules applicable to multipleemployer plans. 

(ii) Treatment of plans without 

credible mortality information. The rule 

of paragraph (c)(1)(i) of this section does 

not prohibit use of substitute mortality 

tables for one plan for a plan year if the 

only other plan or plans maintained by 

the plan sponsor (or by a member of the 

plan sponsor’s controlled group) for 

which substitute mortality tables are not 

used are too small to have fully or 

partially credible mortality information 

for the plan year. For this purpose, the 

demonstration that neither males nor 

females under a plan have credible 

mortality information for a plan year 

must be made by analyzing the actual 

number of deaths over a period that is 

the same length as the longest 

experience study period used for any 

plan within the controlled group and 

that ends less than three years before the 

first day of the plan year. 

(2) Mortality experience 

requirements—(i) In general. Substitute 

mortality tables must reflect the actual 

mortality experience of the pension plan 

for which the tables will be used, and 

that mortality experience must consist 

of credible mortality information as 

described in paragraph (c)(2)(ii) of this 

section. Separate substitute mortality 

tables must be established for each 

gender and, except as provided in 

paragraph (d)(6) of this section, a 

substitute mortality table is permitted to 

be established for a gender only if the 

plan has credible mortality information 

for that gender. See paragraph (d)(5) of 

this section for rules permitting the use 

of substitute mortality tables for 

separate populations within a gender in 

certain circumstances. 

(ii) Credible mortality information— 

(A) In general. A plan has credible 

mortality information for a gender if and 

only if the mortality experience with 

respect to that gender satisfies the 

requirement for either full credibility (as 

described in paragraph (d) of this 

section) or partial credibility (as 

described in paragraph (e) of this 

section). 

(B) Simplified rule. Whether there is 

credible mortality information for a 

gender may be determined by only 

taking into account people who are at 

least age 50 and less than age 100. If 

there is credible mortality information 

for a gender using this simplified rule, 

the entire gender (not just those who are 

at least age 50 and less than age 100) has 

credible mortality information. 

(iii) Gender without credible mortality 

information—(A) In general. If, for the 

first plan year substitute mortality tables 

will be used for a plan, one gender has 

credible mortality information but the 

other gender does not have credible 

mortality information, then substitute 

mortality tables are established for the 

gender that has credible mortality 

information, and the mortality tables 

under § 1.430(h)(3)–1 are used for the 

gender that does not have credible 

mortality information. For a subsequent 

plan year, the plan sponsor may 

continue to use substitute mortality 

tables for the gender with credible 

mortality information without using 

substitute mortality tables for the other 

gender only if the other gender 

continues to lack credible mortality 

information for that subsequent plan 

year. 

(B) Demonstration of lack of credible 

mortality information for a gender. The 

demonstration that a gender does not 

have credible mortality information 

(that is, the individuals of that gender 

had fewer than the minimum number of 

actual deaths to have partial credibility, 

as described in paragraph (e)(1) of this 

section) for a plan year must be made 

by analyzing the actual number of 

deaths over a period that is the same 

length as the period for the experience 

study on which the substitute mortality 

tables are based and that ends less than 

three years before the first day of the 

plan year. 

(3) Determination of substitute 

mortality tables—(i) Requirement to use 

generational mortality table. A plan’s 

substitute mortality tables must be 

generational mortality tables. A plan’s 

substitute mortality tables are 

determined using the plan’s base 

substitute mortality tables developed 

pursuant to paragraph (d) or (e) of this 

section and the mortality improvement 

factors described in paragraph (c)(3)(ii) 

of this section. 

(ii) Determination of mortality 

improvement factors. The mortality 

improvement factor for an age and 

gender is the cumulative mortality 

improvement factor determined under 

§ 1.430(h)(3)–1(a)(2)(i)(E) for that age 

and gender for the applicable period. 

The applicable period is the period 

beginning with the base year for the 


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base substitute mortality table 

determined under paragraph (d) or (e) of 

this section and ending in the calendar 

year in which the individual attains the 

age for which the probability of death is 

being determined. The base year for the 

base substitute mortality table is the 

calendar year that contains the day 

before the midpoint of the experience 

study period. 

(4) Disabled individuals. Under 

section 430(h)(3)(D), separate mortality 

tables are permitted to be used for 

certain disabled individuals. If the 

separate mortality tables issued under 

section 430(h)(3)(D) for certain disabled 

individuals are used, then those 

disabled individuals are disregarded for 

all purposes under this section. Thus, if 

the mortality tables under section 

430(h)(3)(D) are used for disabled 

individuals under a plan, mortality 

experience with respect to those 

individuals must be excluded in 

developing mortality rates for substitute 

mortality tables under this section. 

(5) Aggregation—(i) Permissive 

aggregation of plans. A plan sponsor 

may use the same substitute mortality 

tables for two or more of its plans 

provided that the rules of this section 

are applied by treating those plans as a 

single plan. In such a case, the 

substitute mortality tables must be 

based on data collected with respect to 

those aggregated plans. 

(ii) Required aggregation of plans. In 

general, plans are not required to be 

aggregated for purposes of applying the 

rules of this section. However, for 

purposes of this section, a plan is 

required to be aggregated with any plan 

that was previously spun off from that 

plan if a purpose of the spinoff is to 

avoid the use of substitute mortality 

tables for any of the plans that were 

involved in the spinoff. 

(iii) Special rule regarding experience 

study if aggregated plans have different 

plan years. If two or more plans are 

aggregated pursuant to this paragraph 

(c)(5) and not all of the plans have the 

same plan year, then the experience 

study period may be a period that is not 

a multiple of 12 months, provided 

that— 

(A) The period over which mortality 

experience is collected for each plan 

(the data study period) is a multiple of 

12 months and is based on the plan year 

for that plan; 

(B) The data study periods for all of 

the plans consist of the same number of 

years; 

(C) The data study periods for all of 

the plans satisfy the experience study 

period requirements of paragraph 

(d)(2)(ii) of this section; and 

(D) The data study periods for all of 

the plans have been selected to 

minimize the total period of time 

covered by the experience study period 

by overlapping (to the greatest extent 

possible) those data study periods. 

(6) Duration of use of tables—(i) 

General rule. Except as provided in this 

paragraph (c)(6), substitute mortality 

tables are used for a plan for the term 

of consecutive plan years specified in 

the plan sponsor’s written request for 

approval to use such tables under 

paragraph (b)(1) of this section and 

approved by the Commissioner, or a 

shorter period prescribed by the 

Commissioner in the approval to use 

substitute mortality tables. Following 

the end of the approved term of use, or 

following any early termination of use 

described in this paragraph (c)(6), the 

mortality tables specified in 

§ 1.430(h)(3)–1 must be used for the 

plan unless approval under paragraph 

(b)(1) of this section has been received 

by the plan sponsor to use substitute 

mortality tables based on an updated 

experience study for a further term. 

(ii) Early termination of use of tables. 

A plan’s substitute mortality tables must 

not be used beginning with the earliest 

of— 

(A) For a plan using a substitute 

mortality table for only one gender 

because of a lack of credible mortality 

information with respect to the other 

gender, the first plan year for which 

there is credible mortality information 

with respect to the gender that had 

lacked credible mortality information 

(unless an approved substitute mortality 

table is used for that gender); 

(B) The first plan year for which the 

plan fails to satisfy the requirements of 

paragraph (c)(1) of this section 

(regarding use of substitute mortality 

tables for all plans in the controlled 

group), taking into account the rules of 

paragraph (f)(3) of this section 

(regarding the transition period for 

newly-affiliated plans); 

(C) The second plan year following 

the plan year for which there is a 

significant change in individuals 

covered by the plan as described in 

paragraph (c)(6)(iii) of this section; 

(D) The first plan year following the 

plan year for which a substitute 

mortality table used for a population is 

no longer accurately predictive of future 

mortality of that population, as 

determined by the Commissioner or as 

certified by the plan’s actuary to the 

satisfaction of the Commissioner; or 

(E) The date specified in guidance 

published in the Internal Revenue 

Bulletin (see § 601.601(d)(2)(ii)(b) of this 

chapter) in conjunction with a 

replacement of mortality tables 

specified under section 430(h)(3)(A) and 

§ 1.430(h)(3)–1 (other than annual 

updates to the static mortality tables 

issued pursuant to § 1.430(h)(3)–1(a)(3) 

or changes to the mortality 

improvement rates pursuant to 

§ 1.430(h)(3)–1(a)(2)(i)(C)). 

(iii) Significant change in coverage— 

(A) Change in coverage from time of 

experience study. For purposes of 

applying the rules of paragraph 

(c)(6)(ii)(C) of this section, a significant 

change in the individuals covered by a 

substitute mortality table for a plan year 

occurs if the number of individuals 

covered by the substitute mortality table 

for the plan year is less than 80 percent 

or more than 120 percent of the average 

number of individuals in that 

population over the years covered by 

the experience study on which the 

substitute mortality tables are based. 

However, a change in coverage is not 

treated as significant if the plan’s 

actuary certifies in writing to the 

satisfaction of the Commissioner that 

the substitute mortality tables used for 

the population continue to be accurately 

predictive of future mortality of that 

population (taking into account the 

effect of the change in the population). 

(B) Change in coverage from time of 

certification. For purposes of applying 

the rules of paragraph (c)(6)(ii)(C) of this 

section, a significant change in the 

individuals covered by a substitute 

mortality table for a plan year occurs if 

the number of individuals covered by 

the substitute mortality table for the 

plan year is less than 80 percent or more 

than 120 percent of the number of 

individuals covered by the substitute 

mortality table in a plan year for which 

a certification described in paragraph 

(c)(6)(iii)(A) of this section was made on 

account of a prior change in coverage. 

However, a change in coverage is not 

treated as significant if the plan’s 

actuary certifies in writing to the 

satisfaction of the Commissioner that 

the substitute mortality tables used by 

the plan with respect to the covered 

population continue to be accurately 

predictive of future mortality of that 

population (taking into account the 

effect of the change in the population). 

(7) Multiple-employer plans—(i) 

General rule. In the case of a multipleemployer plan described in section 

413(c), the plan administrator (as 

described in section 414(g)) is treated as 

the plan sponsor for purposes of this 

section. If approval is received to use 

substitute mortality tables by a plan, 

those tables must apply on a plan-wide 

basis (even if the plan is subject to the 

rules of section 413(c)(4)(A)). 

(ii) Application of controlled group 

consistency rules. In the case of an 


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employer that participates in a multipleemployer plan, if the proportion of the 

plan’s funding target attributable to the 

employees and former employees of the 

employer and members of its controlled 

group represents more than 50 percent 

of the plan’s funding target, then the 

employer is treated as maintaining the 

plan for purposes of paragraph (c)(1) of 

this section. Thus, for a multipleemployer plan with credible mortality 

information that is treated as 

maintained by an employer under this 

paragraph (c)(7), unless substitute 

mortality tables are used for that plan, 

substitute mortality tables may not be 

used for any plan maintained by that 

employer or a member of its controlled 

group (and if substitute mortality tables 

are used for any other plan maintained 

by any member of the employer’s 

controlled group, they must be used for 

the multiple-employer plan). By 

contrast, if the proportion of the plan’s 

funding target attributable to the 

employees and former employees of the 

employer and members of its controlled 

group represents 50 percent or less of 

the funding target for a multipleemployer plan in which it participates, 

then the employer is not treated as 

maintaining the plan for purposes of 

paragraph (c)(1) of this section. 

Accordingly, whether substitute 

mortality tables may be used for other 

plans in such an employer’s controlled 

group is independent of whether 

substitute mortality tables are used for 

the multiple-employer plan. 

(d) Full credibility—(1) In general. 

The mortality experience with respect to 

a gender or other population within a 

plan has full credibility if the actual 

number of deaths for that population 

during the experience study period 

described in paragraph (d)(2) of this 

section is at least the full credibility 

threshold described in paragraph (d)(3) 

of this section. Paragraph (d)(4) of this 

section provides rules for the creation of 

a base substitute mortality table from 

the experience study, which apply if the 

mortality experience for the population 

has full credibility. Paragraph (d)(5) of 

this section provides rules regarding the 

use of separate substitute mortality 

tables for plan populations within a 

gender. Paragraph (d)(6) of this section 

provides an option to use the combined 

mortality experience of both genders to 

determine the existence and extent of 

credible mortality information and to 

develop a single mortality ratio for use 

in constructing substitute mortality 

tables. 

(2) Experience study period 

requirements—(i) General rule. The base 

substitute mortality table for a gender or 

other population must be developed 

from an experience study of the 

mortality experience of that population 

that is collected over an experience 

study period. The experience study 

period must consist of 2, 3, 4, or 5 

consecutive 12-month periods, and 

must be the same period for all 

populations except as provided in 

paragraph (c)(5)(iii) of this section. 

(ii) Requirement to use recent 

experience data—(A) General rule. 

Except as provided in paragraph 

(d)(2)(ii)(B) of this section, the last day 

of the experience study period must be 

less than 3 years before the first day of 

the first plan year for which the 

substitute mortality tables are to apply. 

For example, if January 1, 2019, is the 

first day of the first plan year for which 

the substitute mortality tables will be 

used, then an experience study using 

calendar year data generally must 

include data collected for a period that 

ends no earlier than December 31, 2016. 

(B) Exception for submission between 

1 and 2 years before effective date of 

table. If the plan sponsor submits a 

request for approval to use of substitute 

mortality tables more than 1 year (and 

less than 2 years) before the first day of 

the first plan year for which the 

substitute mortality tables are to apply, 

then the experience study is not treated 

as failing to satisfy the rule in paragraph 

(d)(2)(ii)(A) of this section if the last day 

of the final year reflected in the 

experience data is less than 2 years 

before the date of submission. For 

example, if an application for approval 

to use of substitute mortality tables that 

would apply for plan years beginning on 

or after January 1, 2019 year is 

submitted in 2017, then an experience 

study using calendar year data may be 

based on data collected for a period that 

ends as early as December 31, 2015. 

(iii) Experience study based on benefit 

amount. As provided in paragraph 

(d)(4)(i) of this section, the mortality 

rates under the base substitute mortality 

tables are amounts-weighted mortality 

rates that are derived from the 

experience study. An individual’s 

benefit amount (which is used to 

determine amounts-weighted mortality 

rates and for other purposes under this 

paragraph (d)) is the individual’s 

accrued benefit expressed in the form of 

an annual benefit commencing at 

normal retirement age (or at the current 

age, if later) if an individual has not 

commenced benefits and the 

individual’s annual payment if the 

individual has commenced benefits. 

Because amounts-weighted mortality 

rates for a plan are determined using 

benefit amounts, the experience study 

used to develop a base substitute 

mortality table may not include periods 

before the plan was established. 

(3) Full credibility threshold—(i) 

Threshold number of deaths. The full 

credibility threshold for a gender or 

other population is the product of 1,082 

and the population’s benefit dispersion 

factor. In calculating the population’s 

benefit dispersion factor, for purposes of 

paragraphs (d)(3)(iii), (iv), and (v) of this 

section, the population is adjusted, as 

appropriate, for individuals who leave 

the population on account of a reason 

other than death. 

(ii) Population’s benefit dispersion 

factor. The population’s benefit 

dispersion factor is equal to— 

(A) The number of expected deaths 

for the population during the experience 

study period (as defined in paragraph 

(d)(3)(iii) of this section); multiplied by 

(B) The sum of the mortality-weighted 

squares of the benefits (as defined in 

paragraph (d)(3)(iv) of this section); 

divided by 

(C) The square of the sum of the 

mortality-weighted benefits (as defined 

in paragraph (d)(3)(v) of this section). 

(iii) Number of expected deaths. For 

a population, the number of expected 

deaths during the experience study 

period is equal to the sum, for all years 

in the experience study period, of the 

expected number of deaths in the 

population during the year using the 

mortality rates from the standard 

mortality tables determined under 

paragraph (d)(4)(iii) of this section. This 

amount is equal to: 

Where E is equal to the number of years 

in the experience study period, t 

represents each year during the 

experience study period, x represents an 

individual in the population during year 

t, qxt is the mortality rate for that 

individual’s age and gender for the 

calendar year in which year t begins 

under the applicable standard mortality 

table determined under paragraph 

(d)(4)(iii) of this section, and Nt is equal 

to the number of individuals in the 

population in year t. 

(iv) Sum of the mortality-weighted 

squares of the benefits—(A) 

Determination. For a population, the 

sum of the mortality-weighted squares 

of the benefits is the sum, for all years 

in the experience study period, for all 

individuals in the population at the 

beginning of the year, of the product 

of— 

(1) The probability of death for the 

individual using the mortality rate for 


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the individual’s age and gender from the 

standard mortality table determined 

under paragraph (d)(4)(iii) of this 

section; and 

(2) The square of the benefit amount 

for the individual. 

(B) Expression as formula. The sum of 

the mortality-weighted squares of the 

benefits for a population determined 

pursuant to paragraph (d)(3)(iv)(A) of 

this section is equal to: 

Where E is equal to the number of years 

in the experience study period, t 

represents each year during the 

experience study period, x represents an 

individual in the population during year 

t, qxt is the mortality rate for that 

individual’s age and gender for the 

calendar year in which year t begins 

under the applicable standard mortality 

table determined under paragraph 

(d)(4)(iii) of this section, bxt is equal to 

the benefit amount for that individual 

for year t, and Nt is equal to the number 

of individuals in the population in year 

t. 

(v) Square of the sum of the mortalityweighted benefits—(A) Determination. 

For a population, the square of the sum 

of the mortality-weighted benefits is 

equal to the square of the sum, for all 

years in the experience study period, for 

all individuals in the population at the 

beginning of the year, of the product 

of— 

(1) The probability of death of the 

individual using the mortality rate for 

the individual’s age and gender from the 

standard mortality table determined 

under paragraph (d)(4)(iii) of this 

section; and 

(2) The benefit amount for the 

individual. 

(B) Expression as formula. The square 

of the sum of the mortality-weighted 

benefits for a population determined 

pursuant to paragraph (d)(3)(v)(A) of 

this section is equal to: 

Where E is equal to the number of years 

in the experience study period, t 

represents each year during the 

experience study period, x represents an 

individual in the population during year 

t, qxt is the mortality rate for that 

individual’s age and gender for the 

calendar year in which t begins under 

the applicable standard mortality table 

determined under paragraph (d)(4)(iii) 

of this section, bxt is equal to the benefit 

amount for that individual for year t, 

and Nt is equal to the number of 

individuals in the population in year t. 

(4) Development of mortality rates— 

(i) In general. The mortality rates under 

the base substitute mortality tables must 

be amounts-weighted mortality rates 

that are derived from the experience 

study. Except as provided in paragraph 

(d)(4)(iv) of this section, the mortality 

rate for an age and gender is determined 

by multiplying the mortality rate for that 

age and gender from the standard 

mortality table determined under 

paragraph (d)(4)(iii) of this section by 

the mortality ratio determined under 

paragraph (d)(4)(ii) of this section. If the 

simplified rule of paragraph (c)(2)(ii)(B) 

of this section is used for the 

population, then the mortality ratio is 

determined only taking into account 

people who are at least 50 years old and 

less than 100 years old, but the 

mortality ratio is applied to all ages. 

(ii) Mortality ratio—(A) In general. 

Except as provided in paragraph (d)(6) 

of this section, a mortality ratio is 

determined for a gender or other 

population within a gender, and is equal 

to the quotient determined by 

dividing— 

(1) The sum, for all years in the 

experience study period, of the benefit 

amount for all individuals in the 

population at the beginning of the year 

who died during the year, by 

(2) The sum, for all years in the 

experience study period, for all 

individuals in the population at the 

beginning of the year (adjusted, as 

appropriate, for individuals who leave 

on account of reason other than death), 

of the product of— 

(i) The probability of death of the 

individual using the mortality rate for 

the individual’s age and gender from the 

standard mortality table determined 

under paragraph (d)(4)(iii) of this 

section; and 

(ii) The benefit amount for the 

individual. 

(B) Expression as formula. For 

purposes of determining a mortality 

ratio as described in paragraph 

(d)(4)(ii)(A) of this section, the amount 

described in paragraph (d)(4)(ii)(A)(2) of 

this section is equal to: 

Where E is equal to the number of years 

in the experience study period, t 

represents each year during the 

experience study period, x represents an 

individual in the population during year 

t, qxt is the mortality rate for that 

individual’s age and gender for the 

calendar year in which t begins under 

the applicable standard mortality table 

determined under paragraph (d)(4)(iii) 

of this section, bxt is equal to the benefit 

amount for that individual for year t, 

and Nt is equal to the number of 

individuals in the population in year t. 

(iii) Standard mortality table—(A) 

Projection of base table. The standard 

mortality table for a year is the mortality 

table determined by applying 

cumulative mortality improvement 

factors determined under § 1.430(h)(3)– 

1(a)(2)(i)(E) to the base mortality table 

under § 1.430(h)(3)–1(d) for the period 

beginning with 2006 and ending in the 

base year for the base substitute 

mortality table determined under 

paragraph (c)(3)(ii) of this section. For 

purposes of the previous sentence, the 

cumulative mortality improvement 

factors are determined using the 

mortality improvement rates described 

in § 1.430(h)(3)–1(a)(2)(i)(C) that apply 

for the calendar year during which the 

plan sponsor submits the request for 

approval to use substitute mortality 

tables. If the plan sponsor submits such 

a request during 2017, then the 

cumulative mortality improvement 

factors are determined using the 

mortality improvement rates contained 

in the Mortality Improvement Scale 

MP–2016 Report (issued by the 

Retirement Plans Experience Committee 

(RPEC) of the Society of Actuaries and 

available at www.soa.org/Research/ 

Experience-Study/Pension/research2016-mp.aspx). 

(B) Selection of base table. If the 

population consists solely of annuitants, 

the annuitant base mortality table set 

forth in § 1.430(h)(3)–1(d) must be used 

for purposes of paragraph (d)(4)(iii)(A) 

of this section. If the population consists 

solely of nonannuitants, the 

nonannuitant base mortality table set 

forth in § 1.430(h)(3)–1(d) must be used 

for that purpose. If the population 

includes both annuitants and 

nonannuitants, a combination of the 

annuitant and nonannuitant base tables 

set forth in § 1.430(h)(3)–1(d) must be 

used for that purpose. The combined 

table is constructed using the weighting 

factors for small plans that are set forth 

in § 1.430(h)(3)–1(d). The weighting 

factors are applied to develop the 

combined table using the following 

equation: Combined mortality rate = 

[nonannuitant rate * (1 ¥ weighting 


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Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 46409 

factor)] + [annuitant rate * weighting 

factor]. 

(iv) Modification for ages 96 and 

older. Mortality rates for ages 96 and 

older under the base substitute mortality 

table are determined using the rules of 

paragraph (d)(4)(i) of this section but 

substituting a modified mortality ratio 

for the mortality ratio determined under 

paragraph (d)(4)(ii) of this section. The 

modified mortality ratio is determined 

as follows— 

(A) For ages 96 through 109, if the 

mortality ratio is greater than 1.0, the 

modified mortality ratio is equal to the 

mortality ratio for the population 

reduced by 1/15th of the excess of the 

mortality ratio over 1.0 for each year 

that the age exceeds 95. 

(B) For ages 96 through 109, if the 

mortality ratio is less than 1.0, the 

modified mortality ratio is equal to the 

mortality ratio for the population 

increased by 1/15th of the excess of 1.0 

over the mortality ratio for each year 

that the age exceeds 95. 

(C) For ages 110 and older, the 

modified mortality ratio is equal to 1.0. 

(v) Change in number of individuals 

covered by table. Experience data may 

not be used to develop a base table if the 

number of individuals in the population 

covered by the table (for example, the 

male annuitant population) as of the last 

day of the plan year before the year the 

request for approval to use the 

substitute mortality table is made is less 

than 80 percent or more than 120 

percent of the average number of 

individuals in that population over the 

years covered by the experience study 

on which the substitute mortality tables 

are based, unless it is demonstrated to 

the satisfaction of the Commissioner 

that the experience data is accurately 

predictive of future mortality of that 

population (taking into account the 

effect of the change in individuals) after 

appropriate adjustments to the data are 

made (for example, excluding data from 

individuals with respect to a spun-off 

portion of the plan). For this purpose, a 

reasonable estimate of the number of 

individuals in the population covered 

by the table may be used. 

(5) Separate tables for specified 

populations—(i) In general. Except as 

provided in this paragraph (d)(5), 

separate substitute mortality tables are 

permitted to be used for separate 

populations within a gender only if— 

(A) All individuals of that gender are 

divided into separate populations; 

(B) Each separate population has 

mortality experience that has full 

credibility as determined under the 

rules of paragraph (d)(5)(iii) of this 

section; and 

(C) The separate base substitute 

mortality table for each separate 

population is developed applying the 

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

this section using an experience study 

that takes into account solely members 

of that population. 

(ii) Annuitant and nonannuitant 

separate populations. Notwithstanding 

paragraph (d)(5)(i)(B) of this section, a 

gender may be separated into separate 

populations of annuitants and 

nonannuitants for the purpose of 

developing and using substitute 

mortality tables, even if only one of 

those separate populations has credible 

mortality information. Similarly, if 

separate populations that satisfy 

paragraph (d)(5)(i)(B) of this section are 

established, then any of those 

populations may be further subdivided 

into separate annuitant and 

nonannuitant subpopulations, provided 

that at least one of the two resulting 

subpopulations has credible mortality 

information. The standard mortality 

tables under § 1.430(h)(3)–1 are used for 

a resulting subpopulation that does not 

have credible mortality information. For 

example, if the male hourly and salaried 

populations under a plan each have 

mortality experience with full 

credibility and the male salaried 

annuitant population has credible 

mortality information, then substitute 

mortality tables may be used for the 

plan with respect to the male salaried 

annuitant population even if the 

standard mortality tables under 

§ 1.430(h)(3)–1 are used with respect to 

the male salaried nonannuitant 

population (because that nonannuitant 

population does not have credible 

mortality information). 

(iii) Credible mortality information for 

separate populations. In determining 

whether the mortality experience for a 

separate population within a gender has 

full credibility, the rules of paragraph 

(d)(1) of this section must be applied to 

that separate population. In 

demonstrating that an annuitant (or 

nonannuitant) population within a 

gender or within a separate population 

does not have credible mortality 

information, the rules of paragraph 

(c)(2)(iii)(B) of this section are applied 

by substituting the annuitant (or 

nonannuitant) population for the 

gender. 

(6) Option to determine a single 

mortality ratio for both genders. Base 

substitute mortality tables for a plan 

may be constructed by developing and 

applying a single mortality ratio for both 

genders, but only if the substitute 

mortality tables used for all plans 

maintained by members of the plan 

sponsor’s controlled group (except for 

plans for which both the male and 

female populations, considered 

separately, have mortality experience 

with full credibility) are constructed in 

this manner. If the option under this 

paragraph (d)(6) is applied for a plan 

then, for all plans maintained by 

members of the plan sponsor’s 

controlled group, whether both the male 

and female populations within the plan 

have credible mortality information 

(and, if that combined population’s 

mortality experience does not have full 

credibility, the partial credibility 

weighting factor for the plan) is 

determined using the combined 

mortality experience for both genders. 

(e) Partial credibility—(1) In general. 

The mortality experience with respect to 

a population has partial credibility if the 

actual number of deaths for that 

population during the experience study 

period described in paragraph (d)(2) of 

this section is at least equal to 100 and 

is less than the full credibility threshold 

described for the population in 

paragraph (d)(3) of this section. If the 

mortality experience for the population 

has partial credibility, then in lieu of 

creating a base substitute mortality table 

as described in paragraph (d) of this 

section, the base substitute mortality 

table is created as the sum of— 

(i) The product of— 

(A) The partial credibility weighting 

factor determined under paragraph 

(e)(2) of this section; and 

(B) The mortality rates that are 

derived from the experience study 

determined under paragraph (d)(4)(i) of 

this section, and 

(ii) The product of— 

(A) One minus the partial credibility 

weighting factor described in paragraph 

(e)(2) of this section; and 

(B) The mortality rate from the 

standard mortality tables described in 

paragraph (d)(4)(iii) of this section. 

(2) Partial credibility weighting factor. 

The partial credibility weighting factor 

is equal to the square root of the 

fraction— 

(i) The numerator of which is the 

actual number of deaths for the 

population during the experience study 

period, and 

(ii) The denominator of which is the 

full credibility threshold for the 

population described in paragraph (d)(3) 

of this section. 

(f) Special rules for newly-affiliated 

plans—(1) In general. This paragraph (f) 

provides special rules that provide 

temporary relief from certain rules in 

this section in the case of a controlled 

group that includes a newly-affiliated 

plan (as defined in paragraph (f)(2) of 

this section). Paragraph (f)(3) of this 

section provides a transition period 


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46410 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 

during which the requirement in 

paragraph (c)(1) of this section (that is, 

the requirement that all plans within the 

controlled group that have credible 

mortality information must use 

substitute mortality tables) is not 

applicable. Paragraph (f)(4) of this 

section provides special rules that 

permit the use of a shorter experience 

study period in the case of a newlyaffiliated plan that excludes the 

mortality experience data for the period 

before the date the plan becomes a 

newly-affiliated plan. 

(2) Definition of newly-affiliated plan. 

For purposes of this paragraph (f), a 

plan is a newly-affiliated plan if the 

plan sponsor becomes a member of the 

new controlled group in connection 

with a merger, acquisition, or similar 

transaction described in § 1.410(b)–2(f). 

A plan also is treated as a newlyaffiliated plan for purposes of this 

section if the plan is established in 

connection with a transfer of assets and 

liabilities from another employer’s plan 

in connection with a merger, 

acquisition, or similar transaction 

described in § 1.410(b)–2(f). 

(3) Transition period for newlyaffiliated plans. The use of substitute 

mortality tables for a plan within a 

controlled group is not prohibited 

merely because, during the transition 

period, substitute mortality tables are 

not used for a newly-affiliated plan that 

fails to demonstrate a lack of credible 

mortality information during that 

period. Similarly, during the transition 

period, the use of substitute mortality 

tables for a newly-affiliated plan is not 

prohibited merely because substitute 

mortality tables are not used for another 

plan within the controlled group that 

fails to demonstrate a lack of credible 

mortality information during that 

period. The transition period begins on 

the date of the transaction that results in 

the plan becoming a newly-affiliated 

plan and ends on the last day of the plan 

year that immediately follows the latest 

ending period described in section 

410(b)(6)(C)(ii) with respect to that 

transaction for any of the plans in the 

controlled group. 

(4) Experience study period for newlyaffiliated plan—(i) In general. The 

mortality experience data for a newlyaffiliated plan may either include or 

exclude mortality experience data for 

the period before the date the plan 

becomes a newly-affiliated plan. If a 

plan sponsor excludes mortality 

experience data for the period before the 

date the plan becomes a newly-affiliated 

plan, the exclusion must apply for all 

populations within the plan. 

(ii) Demonstration relating to lack of 

credible mortality information. If the 

experience study for a newly-affiliated 

plan excludes mortality experience data 

for the period prior to the date the plan 

becomes a newly-affiliated plan, then 

the demonstration that the plan does not 

have credible mortality information for 

a plan year that begins after the 

transition period can be made using a 

shorter experience study period than 

would otherwise be permitted under 

paragraph (c)(2)(iii)(B) of this section, 

provided that the experience study 

period begins with the date the plan 

becomes a newly-affiliated plan and 

ends not more than one year and one 

day before the first day of the plan year. 

(iii) Demonstration relating to credible 

mortality information. If the experience 

study for a newly-affiliated plan 

excludes mortality experience data for 

the period before the date the plan 

becomes a newly-affiliated plan and the 

plan fails to demonstrate that it does not 

have credible mortality information for 

the plan year under the rules of 

paragraph (f)(4)(ii) of this section, then 

other plans within the controlled group 

may continue to use substitute mortality 

tables only if substitute mortality tables 

are used for the newly-affiliated plan for 

the plan year. In such a case, the 

experience study period for the newlyaffiliated plan may consist of a 12- 

month period. 

(g) Effective/applicability date—(1) 

General rule. This section applies for 

plan years beginning on or after January 

1, 2018. Except as provided in 

paragraph (g)(2) of this section, the 

substitute mortality table used for a plan 

for such a plan year must comply with 

the rules of paragraphs (a) through (f) of 

this section. 

(2) Transition rule for previously 

approved substitute mortality tables—(i) 

Applicability for 2018. If a plan sponsor 

has received approval from the 

Commissioner to use substitute 

mortality tables for a plan year 

beginning in 2017, then that previous 

approval applies to a plan year 

beginning in 2018 provided that— 

(A) The previous approval period had 

not ended; 

(B) Substitute mortality tables are 

used for all plans in the plan sponsor’s 

controlled group in accordance with the 

terms of that approval; and 

(C) The projection factors provided in 

Projection Scale AA, as set forth in 

§ 1.430(h)(3)–1(d) as in effect on 

December 31, 2017 (as contained in 26 

CFR part 1 revised April 1, 2017) are 

applied to the base substitute mortality 

table. 

(ii) Applicability for later plan years. 

If a plan sponsor is described in 

paragraph (g)(2)(i) of this section, then 

that previous approval applies to a later 

plan year provided that— 

(A) The previous approval period had 

not ended; 

(B) Substitute mortality tables are 

used for all plans in the plan sponsor’s 

controlled group that have credible 

mortality information within the 

meaning of paragraph (c)(2)(ii) of this 

section; and 

(C) The mortality improvement factors 

described in paragraph (c)(3)(ii) of this 

section are applied to the base substitute 

mortality table. 

(3) Transition rule for requests for 

approval to use substitute mortality 

tables. A written request described in 

paragraph (b)(1)(i) of this section to use 

substitute mortality tables for a plan 

year that begins during 2018 does not 

fail to satisfy the timing requirement of 

paragraph (b)(1)(ii) of this section if it is 

submitted no later than February 28, 

2018, provided that the plan sponsor 

agrees to a 90-day extension of the 180- 

day review period in accordance with 

paragraph (b)(2)(iv) of this section. 

■ Par. 4. Section 1.431(c)(6)–1 is revised 

to read as follows: 

§ 1.431(c)(6)–1 Mortality tables used to 

determine current liability. 

(a) Mortality tables used to determine 

current liability. The mortality 

assumptions that apply to a defined 

benefit plan for the plan year pursuant 

to section 430(h)(3)(A) and 

§ 1.430(h)(3)–1(a) are used to determine 

a multiemployer plan’s current liability 

for purposes of applying the rules of 

section 431(c)(6). Either the generational 

mortality tables used pursuant to 

§ 1.430(h)(3)–1(a)(2) or the static 

mortality tables used pursuant to 

§ 1.430(h)(3)–1(a)(3) may be used for a 

multiemployer plan for this purpose. 

However, for this purpose, substitute 

mortality tables under § 1.430(h)(3)–2 

may not be used for a multiemployer 

plan. 

(b) Effective/applicability date. This 

section applies for plan years beginning 

on or after January 1, 2018. For rules 

that apply to plan years beginning 

before January 1, 2018 and on or after 

January 1, 2008, see § 1.431(c)(6)–1 (as 

contained in 26 CFR part 1 revised April 

1, 2015). 

■ Par. 5. Section 1.433(h)(3)–1 is added 

to read as follows: 

§ 1.433(h)(3)–1 Mortality tables used to 

determine current liability. 

(a) Mortality tables used to determine 

current liability. In accordance with 

section 433(h)(3)(B), the mortality 

assumptions that apply to a defined 

benefit plan for the plan year pursuant 

to section 430(h)(3)(A) and 


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Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Rules and Regulations 46411 

§ 1.430(h)(3)–1(a) are used to determine 

a CSEC plan’s current liability for 

purposes of applying the rules of section 

433(c)(7)(C). Either the static mortality 

tables used pursuant to § 1.430(h)(3)– 

1(a)(3) or generational mortality tables 

used pursuant to § 1.430(h)(3)–1(a)(2) 

may be used for a CSEC plan for this 

purpose, but substitute mortality tables 

under § 1.430(h)(3)–2 may not be used 

for this purpose. 

(b) Effective/applicability date. This 

section applies for plan years beginning 

on or after January 1, 2018. 

Kirsten Wielobob, 

Deputy Commissioner for Services and 

Enforcement. 

Approved: August 21, 2017. 

David Kautter, 

Assistant Secretary of the Treasury for Tax 

Policy. 

[FR Doc. 2017–21485 Filed 10–3–17; 4:15 pm] 

BILLING CODE 4830–01–P 

DEPARTMENT OF LABOR 

Mine Safety and Health Administration 

30 CFR Parts 56 and 57 

[Docket No. MSHA–2014–0030] 

RIN 1219–AB87 

Examinations of Working Places in 

Metal and Nonmetal Mines 

AGENCY: Mine Safety and Health 

Administration, Labor. 

ACTION: Final rule; stay of effective date; 

reinstatement of rules. 

SUMMARY: The Mine Safety and Health 

Administration is staying the effective 

date of the Agency’s January 23, 2017, 

final rule that amended standards for 

examination of working places in metal 

and nonmetal mines to June 2, 2018. 

MSHA also is reinstating the provisions 

of the working place examinations 

standards that were in effect as of 

October 1, 2017. This stay and 

reinstatement offers additional time for 

MSHA to provide stakeholders training 

and compliance assistance. 

DATES: As of October 5, 2017, 30 CFR 

56.18002 and 57.18002 are stayed until 

June 2, 2018, and 30 CFR 56.18002T and 

57.18002T are added until June 2, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Sheila A. McConnell, Director, Office of 

Standards, Regulations, and Variances, 

MSHA, at mcconnell.sheila.a@dol.gov 

(email); 202–693–9440 (voice); or 202– 

693–9441 (facsimile). 

SUPPLEMENTARY INFORMATION: 

I. Stay of Effective Date 

On January 23, 2017, MSHA 

published a final rule in the Federal 

Register (82 FR 7680) amending the 

Agency’s standards for the examination 

of working places in metal and 

nonmetal (MNM) mines (January 2017 

final rule). The final rule was scheduled 

to become effective on May 23, 2017. On 

May 22, 2017, MSHA published a final 

rule delaying the effective date to 

October 2, 2017 (82 FR 23139). On 

September 12, 2017, MSHA proposed to 

further delay the effective date of the 

final rule from October 2, 2017 to March 

2, 2018 (82 FR 42765). The comment 

period for the proposed delay of the 

final rule’s effective date closed on 

September 26, 2017. 

In the same issue of the Federal 

Register, MSHA reopened the 

rulemaking record and proposed to 

amend the January 2017 final rule with 

regard to the timing of the working 

place examination and contents of the 

examination record (82 FR 42757). 

MSHA has scheduled four public 

hearings from October 24, 2017, to 

November 2, 2017, at various locations, 

to provide the members of the public an 

opportunity to present their views on 

the limited changes being proposed. The 

comment period for the proposed 

limited changes closes on November 13, 

2017. 

Most commenters on the proposed 

rule to delay the effective date of the 

final rule supported extending the date 

beyond October 2, 2017. One 

commenter who supported extending 

the effective date to March 2, 2018, 

stated that the extension of time would 

offer additional time for MSHA to 

provide stakeholders training and 

compliance assistance, would further 

permit MSHA to address issues raised 

by stakeholders during quarterly 

training calls and stakeholder meetings 

and compliance assistance visits, and 

would also provide MSHA more time to 

train its inspectors to help ensure 

consistency in MSHA enforcement. This 

commenter also supported a further 

delay of the effective date of the final 

rule, should such be required, if the 

Agency has yet to achieve its stated 

goals. 

Many commenters stated that an 

extension beyond October 2, 2017 is 

necessary and appropriate and 

recommended an indefinite suspension 

of the effective date. The commenters 

maintained that, since substantive 

changes to the January 2017 final rule 

were proposed at the same time as the 

proposed delay, it is imprudent to 

establish any effective date until an 

amended final rule is promulgated and 

the substance of the rule is known. In 

addition, they acknowledged MSHA’s 

stated intent to provide compliance 

assistance to industry and specific 

training to inspectors prior to the 

effective date. The commenters 

expressed concern that, for any 

compliance assistance measures to have 

any meaning, it is necessary for the 

exact terms of the final rule to be known 

before the final rule’s effective date. 

Then, after the period of compliance 

assistance from MSHA, mine operators 

will be required to develop appropriate 

compliance programs to comply with 

the final rule. Given the uncertainty of 

the final rule’s provisions and the 

compliance assistance efforts to be 

scheduled, the commenters believed 

that an appropriate effective date cannot 

be established. 

Other commenters stated that the 

proposed delay to March 2, 2018, was 

arbitrary and does not increase the 

likelihood that MSHA will complete all 

of the compliance assistance, outreach, 

and training tasks in that timeframe, or 

that the MNM industry will be ready to 

comply on the new effective date. They 

recommended that MSHA establish an 

effective date that is six months after the 

date on which any changes to the final 

Examinations rule are published in the 

Federal Register. 

MSHA agrees with commenters who 

support an extension beyond the 

proposed March 2, 2018 effective date 

so that the Agency will complete its 

stated goals by the effective date of the 

final rule. To ensure compliance 

readiness on that date, MSHA is 

developing compliance assistance 

materials to assist the industry. A stay 

beyond the proposed March 2, 2018, 

effective date will provide MSHA the 

time and flexibility to make these 

materials available to stakeholders and 

post them on MSHA’s Web site 

(www.msha.gov); hold informational 

stakeholder meetings at various 

locations around the country; and focus 

on compliance assistance visits in other 

areas of the country, as well as ensure 

all issues at these meetings and visits 

are addressed. Additional time will also 

allow MSHA to train its inspectors to 

ensure consistent enforcement. MSHA 

will make the Agency’s inspector 

training materials available to the 

mining community to assist miners and 

mine operators in effectively 

implementing the rule, thus enhancing 

the safety of miners. 

Labor union commenters did not 

support the proposed delay in the 

effective date, stating that a delay was 

unnecessary and miners’ health and 

safety would be affected by an 

extension. Labor also stated that the 


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