rr-18-21.pdf

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Section 1274.--Determination of Issue Price in the Case of Certain Debt Instruments
Issued for Property

(Also Sections 42, 280G, 382, 467, 468, 482, 483, 1288, 7520, 7872.)

Rev. Rul. 2018-21

This revenue ruling provides various prescribed rates for federal
income tax purposes for August 2018 (the current month). Table 1
contains the short-term, mid-term, and long-term applicable federal rates
(AFR) for the current month for purposes of section 1274(d) of the Internal
Revenue Code. Table 2 contains the short-term, mid-term, and long-term
adjusted applicable federal rates (adjusted AFR) for the current month for
purposes of section 1288(b). Table 3 sets forth the adjusted federal long-
term rate and the long-term tax-exempt rate described in section 382(f).
Table 4 contains the appropriate percentages for determining the low-
income housing credit described in section 42(b)(1) for buildings placed in
service during the current month. However, under section 42(b)(2), the
applicable percentage for non-federally subsidized new buildings placed in
service after July 30, 2008, shall not be less than 9%. Finally, Table 5
contains the federal rate for determining the present value of an annuity,
an interest for life or for a term of years, or a remainder or a reversionary
interest for purposes of section 7520.

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REV. RUL. 2018-21 TABLE 1

Applicable Federal Rates (AFR) for August 2018

Period for Compounding
Annual Semiannual Quarterly Monthly

Short-term

AFR 2.42% 2.41% 2.40% 2.40%
110% AFR 2.67% 2.65% 2.64% 2.64%
120% AFR 2.91% 2.89% 2.88% 2.87%
130% AFR 3.15% 3.13% 3.12% 3.11%

Mid-term

AFR 2.80% 2.78% 2.77% 2.76%
110% AFR 3.08% 3.06% 3.05% 3.04%
120% AFR 3.37% 3.34% 3.33% 3.32%
130% AFR 3.64% 3.61% 3.59% 3.58%
150% AFR 4.21% 4.17% 4.15% 4.13%
175% AFR 4.93% 4.87% 4.84% 4.82%

Long-term

AFR 2.95% 2.93% 2.92% 2.91%
110% AFR 3.25% 3.22% 3.21% 3.20%
120% AFR 3.55% 3.52% 3.50% 3.49%
130% AFR 3.85% 3.81% 3.79% 3.78%

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REV. RUL. 2018-21 TABLE 2

Adjusted AFR for August 2018

Period for Compounding
Annual Semiannual Quarterly Monthly
Short-term
adjusted AFR 1.84% 1.83% 1.83% 1.82%

Mid-term
adjusted AFR 2.12% 2.11% 2.10% 2 .10%

Long-term
adjusted AFR 2.23% 2.22% 2.21% 2.21%

REV. RUL. 2018-21 TABLE 3

Rates Under Section 382 for August 2018

Adjusted federal long-term rate for the current month 2.23%

Long-term tax-exempt rate for ownership changes during the
current month (the highest of the adjusted federal long-term
rates for the current month and the prior two months.) 2.32%

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REV. RUL. 2018-21 TABLE 4

Appropriate Percentages Under Section 42(b)(1) for August 2018
Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized
new buildings placed in service after July 30, 2008, shall not be less than 9%.

Appropriate percentage for the 70% present value low-income
housing credit 7.66%

Appropriate percentage for the 30% present value low-income
housing credit 3.28%

REV. RUL. 2018-21 TABLE 5

Rate Under Section 7520 for August 2018

Applicable federal rate for determining the present value of an
annuity, an interest for life or a term of years, or a remainder or
reversionary interest 3.4%