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ment rate with respect to the applicable 
month. 
‘‘(C) SEGMENT RATES.—For purposes of 
this paragraph— 
‘‘(i) FIRST
SEGMENT
RATE.—The 
term ‘first segment rate’ means, with re-
spect to any month, the single rate of in-
terest which shall be determined by the 
Secretary of the Treasury for such month 
on the basis of the corporate bond yield 
curve for such month, taking into account 
only that portion of such yield curve which 
is based on bonds maturing during the 5- 
year period commencing with such month. 
‘‘(ii) SECOND
SEGMENT
RATE.—The 
term ‘second segment rate’ means, with re-
spect to any month, the single rate of in-
terest which shall be determined by the 
Secretary of the Treasury for such month 
on the basis of the corporate bond yield 
curve for such month, taking into account 
only that portion of such yield curve which 
is based on bonds maturing during the 15- 
year period beginning at the end of the pe-
riod described in clause (i).
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‘‘(iii) THIRD
SEGMENT
RATE.—The 
term ‘third segment rate’ means, with re-
spect to any month, the single rate of in-
terest which shall be determined by the 
Secretary of the Treasury for such month 
on the basis of the corporate bond yield 
curve for such month, taking into account 
only that portion of such yield curve which 
is based on bonds maturing during periods 
beginning after the period described in 
clause (ii). 
‘‘(D) CORPORATE BOND YIELD CURVE.— 
For purposes of this paragraph— 
‘‘(i) IN
GENERAL.—The term ‘cor-
porate bond yield curve’ means, with re-
spect to any month, a yield curve which is 
prescribed by the Secretary of the Treas-
ury for such month and which reflects a 3- 
year weighted average of yields on invest-
ment grade corporate bonds with varying 
maturities. 
‘‘(ii) 3-YEAR WEIGHTED AVERAGE.— 
The term ‘3-year weighted average’ means 
an average determined by using a method-
ology under which the most recent year is
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weighted 50 percent, the year preceding 
such year is weighted 35 percent, and the 
second year preceding such year is weight-
ed 15 percent. 
‘‘(E) APPLICABLE MONTH.—For purposes 
of this paragraph, the term ‘applicable month’ 
means, with respect to any plan for any plan 
year, the month which includes the valuation 
date of such plan for such plan year or, at the 
election of the plan sponsor, any of the 4 
months which precede such month. Any election 
made under this subparagraph shall apply to 
the plan year for which the election is made and 
all succeeding plan years, unless the election is 
revoked with the consent of the Secretary of the 
Treasury. 
‘‘(F) PUBLICATION REQUIREMENTS.—The 
Secretary of the Treasury shall publish for each 
month the corporate bond yield curve (and the 
corporate bond yield curve reflecting the modi-
fication 
described 
in 
section 
205(g)(3)(B)(iii)(I)) for such month and each 
of the rates determined under subparagraph 
(B) for such month. The Secretary of the 
Treasury shall also publish a description of the
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methodology used to determine such yield curve 
and such rates which is sufficiently detailed to 
enable plans to make reasonable projections re-
garding the yield curve and such rates for fu-
ture months based on the plan’s projection of 
future interest rates. 
‘‘(G) TRANSITION RULE.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
the preceding provisions of this paragraph, 
for plan years beginning in 2007 or 2008, 
the first, second, or third segment rate for 
a plan with respect to any month shall be 
equal to the sum of— 
‘‘(I) the product of such rate for 
such month determined without re-
gard to this subparagraph, multiplied 
by the applicable percentage, and 
‘‘(II) the product of the rate de-
termined under the rules of section 
302(b)(5)(B)(ii)(II) (as in effect for 
plan years beginning in 2006), multi-
plied by a percentage equal to 100 
percent minus the applicable percent-
age.
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‘‘(ii) APPLICABLE PERCENTAGE.—For 
purposes of clause (i), the applicable per-
centage is 331⁄3 percent for plan years be-
ginning in 2007 and 662⁄3 percent for plan 
years beginning in 2008. 
‘‘(iii) 
NEW
PLANS
INELIGIBLE.— 
Clause (i) shall not apply to any plan if the 
first plan year of the plan begins after De-
cember 31, 2006. 
‘‘(3) MORTALITY TABLE.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the mortality table used in 
determining any present value or making any 
computation under this section shall be the 
RP–2000 Combined Mortality Table using 
Scale AA published by the Society of Actuaries 
(as in effect on the date of the enactment of the 
Pension Protection Act of 2005), projected as 
of the plan’s valuation date. 
‘‘(B) SUBSTITUTE MORTALITY TABLE.— 
‘‘(i) IN GENERAL.—Upon request by 
the plan sponsor and approval by the Sec-
retary of the Treasury for a period not to 
exceed 10 years, a mortality table which 
meets the requirements of clause (ii) shall
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be used in determining any present value 
or making any computation under this sec-
tion. A mortality table described in this 
clause shall cease to be in effect if the plan 
actuary determines at any time that such 
table does not meet the requirements of 
subclauses (I) and (II) of clause (ii). 
‘‘(ii) REQUIREMENTS.—A mortality 
table meets the requirements of this clause 
if the Secretary of the Treasury determines 
that— 
‘‘(I) such table reflects the actual 
experience of the pension plan and 
projected trends in such experience, 
and 
‘‘(II) such table is significantly 
different from the table described in 
subparagraph (A). 
‘‘(iii) DEADLINE FOR DISPOSITION OF 
APPLICATION.—Any mortality table sub-
mitted to the Secretary of the Treasury for 
approval under this subparagraph shall be 
treated as in effect for the succeeding plan 
year unless such Secretary, during the 
180-day period beginning on the date of
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such submission, disapproves of such table 
and provides the reasons that such table 
fails to meet the requirements of clause 
(ii). 
‘‘(C) TRANSITION
RULE.—Under regula-
tions of the Secretary of the Treasury, any dif-
ference in present value resulting from the dif-
ference in the assumptions as set forth in the 
mortality table specified in subparagraph (A) 
and the assumptions as set forth in the mor-
tality table described in section 302(d)(7)(C)(ii) 
(as in effect for plan years beginning in 2006) 
shall be phased in ratably over the first period 
of 5 plan years beginning in or after 2007 so 
as to be fully effective for the fifth plan year. 
The preceding sentence shall not apply to any 
plan if the first plan year of the plan begins 
after December 31, 2006. 
‘‘(4) PROBABILITY OF BENEFIT PAYMENTS IN 
THE FORM OF LUMP SUMS OR OTHER OPTIONAL 
FORMS.—For purposes of determining any present 
value or making any computation under this section, 
there shall be taken into account— 
‘‘(A) the probability that future benefit 
payments under the plan will be made in the
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form of optional forms of benefits provided 
under the plan (including lump sum distribu-
tions, determined on the basis of the plan’s ex-
perience and other related assumptions), and 
‘‘(B) any difference in the present value of 
such future benefit payments resulting from the 
use of actuarial assumptions, in determining 
benefit payments in any such optional form of 
benefits, which are different from those speci-
fied in this subsection. 
‘‘(5) APPROVAL OF LARGE CHANGES IN ACTU-
ARIAL ASSUMPTIONS.— 
‘‘(A) IN GENERAL.—No actuarial assump-
tion used to determine the funding target for a 
plan to which this paragraph applies may be 
changed without the approval of the Secretary 
of the Treasury. 
‘‘(B) PLANS
TO
WHICH
PARAGRAPH
AP-
PLIES.—This paragraph shall apply to a plan 
only if— 
‘‘(i) the plan is a single-employer plan 
to which title IV applies, 
‘‘(ii) the aggregate unfunded vested 
benefits as of the close of the preceding 
plan year (as determined under section
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4006(a)(3)(E)(iii)) of such plan and all 
other plans maintained by the contributing 
sponsors 
(as 
defined 
in 
section 
4001(a)(13)) and members of such spon-
sors’ controlled groups (as defined in sec-
tion 4001(a)(14)) which are covered by 
title IV (disregarding plans with no un-
funded 
vested 
benefits) 
exceed 
$50,000,000, and 
‘‘(iii) the change in assumptions (de-
termined after taking into account any 
changes in interest rate and mortality 
table) results in a decrease in the funding 
shortfall of the plan for the current plan 
year that exceeds $50,000,000, or that ex-
ceeds $5,000,000 and that is 5 percent or 
more of the funding target of the plan be-
fore such change. 
‘‘(i) SPECIAL RULES FOR AT-RISK PLANS.— 
‘‘(1) FUNDING TARGET FOR PLANS IN AT-RISK 
STATUS.— 
‘‘(A) IN GENERAL.—In any case in which 
a plan is in at-risk status for a plan year, the 
funding target of the plan for the plan year is 
the sum of—