PUBLIC LAW 109–280—AUG. 17, 2006
120 STAT. 921
Secretary, based on the mortality table specified for the plan year under subparagraph (A) of section 430(h)(3) (without regard to subparagraph (C) or (D) of such section). ‘‘(C) APPLICABLE INTEREST RATE.—For purposes of subparagraph (A), the term ‘applicable interest rate’ means the adjusted first, second, and third segment rates applied under rules similar to the rules of section 430(h)(2)(C) for the month before the date of the distribution or such other time as the Secretary may by regulations prescribe. ‘‘(D) APPLICABLE SEGMENT RATES.—For purposes of subparagraph (C), the adjusted first, second, and third segment rates are the first, second, and third segment rates which would be determined under section 430(h)(2)(C) if— ‘‘(i) section 430(h)(2)(D) were applied by substituting the average yields for the month described in clause (ii) for the average yields for the 24-month period described in such section, ‘‘(ii) section 430(h)(2)(G)(i)(II) were applied by substituting ‘section 417(e)(3)(A)(ii)(II)’ for ‘section 412(b)(5)(B)(ii)(II)’, and ‘‘(iii) the applicable percentage under section 430(h)(2)(G) were determined in accordance with the following table:
‘‘In the case beginning in: 2008 2009 2010 2011
of
plan years
The applicable percentage is:
........................................................................ ........................................................................ ........................................................................ ........................................................................
20 40 60 80
percent percent percent percent.’’.
(c) EFFECTIVE DATE.—The amendments made by this section shall apply with respect to plan years beginning after December 31, 2007.
26 USC 417 note.
SEC. 303. INTEREST RATE ASSUMPTION FOR APPLYING BENEFIT LIMITATIONS TO LUMP SUM DISTRIBUTIONS.
(a) IN GENERAL.—Clause (ii) of section 415(b)(2)(E) of the Internal Revenue Code of 1986 is amended to read as follows: ‘‘(ii) For purposes of adjusting any benefit under subparagraph (B) for any form of benefit subject to section 417(e)(3), the interest rate assumption shall not be less than the greatest of— ‘‘(I) 5.5 percent, ‘‘(II) the rate that provides a benefit of not more than 105 percent of the benefit that would be provided if the applicable interest rate (as defined in section 417(e)(3)) were the interest rate assumption, or ‘‘(III) the rate specified under the plan.’’. (b) EFFECTIVE DATE.—The amendment made by subsection (a) shall apply to distributions made in years beginning after December 31, 2005.
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26 USC 415.
26 USC 415 note.
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