n-17-60.pdf

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Updated Static Mortality Tables for Defined Benefit Pension Plans for 2018

Notice 2017-60

PURPOSE

This notice sets forth the mortality table that is used for purposes of
determining minimum present value under § 417(e)(3) of the Internal Revenue
Code (Code) and section 205(g)(3) of the Employee Retirement Income Security
Act of 1974, Public Law No. 93-406, as amended, for distributions with annuity
starting dates that occur during stability periods beginning in the 2018 calendar
year. This mortality table is a modified unisex version of the mortality tables
specified under § 430(h)(3)(A) of the Code, which have been revised pursuant to
§ 430(h)(3)(B) by T.D. 9826, for plan years beginning in 2018.

This notice also provides updated static mortality tables determined using
the methodology in § 1.430(h)(3)-1 prior to its amendment by T.D. 9826. These
updated static mortality tables apply for plan years beginning during 2017 with
respect to valuation dates occurring during 2018. These updated static mortality
tables also apply for the plan year beginning during 2018 if the option under
§ 1.430(h)(3)-1(f)(2) is used for the plan. The option under § 1.430(h)(3)-1(f)(2),
which is available under certain circumstances for valuation dates occurring
during 2018, is to apply mortality tables determined in accordance with
regulations previously in effect.

BACKGROUND

Section 412 of the Code provides minimum funding requirements that
generally apply for defined benefit plans. Section 412(a)(2) provides that § 430
specifies the minimum funding requirements that generally apply to defined
benefit plans that are not multiemployer plans. Section 430(a) defines the
minimum required contribution for such a plan by reference to the plan’s funding
target for the plan year.
Under § 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) provides rules regarding the mortality tables that are
generally used under § 430. Under § 430(h)(3)(A), except as provided in
§ 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
§ 430. Those tables are to be based on the actual experience of pension plans
and projected trends in that experience. Section 430(h)(3)(B) requires the
Secretary to revise any table in effect under § 430(h)(3)(A) at least every 10
years to reflect the actual experience of pension plans and projected trends in
that experience.

2
Section 430(h)(3)(C) provides that, upon request by a plan sponsor and
approval by the Secretary, substitute mortality tables that meet the applicable
requirements may be used in lieu of the standard mortality tables provided under
§ 430(h)(3)(A). 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.

Section 417(e)(3) generally provides that the present value of certain
accelerated forms of benefit 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 under § 430(h)(3)(A) (without regard to § 430(h)(3)(C) or (D)), modified
as appropriate by the Secretary.

Section 1.430(h)(3)-1 was amended on October 5, 2017, by T.D. 9826, 82
F.R. xxxxx, to revise the mortality tables used under § 430(h)(3)(A) for plan years
beginning on or after January 1, 2018. The mortality tables used under
§ 430(h)(3)(A) are based on the tables contained in the RP-2014 Mortality Tables
Report,
1
adjusted for mortality improvement. Section 1.430(h)(3)-1 sets forth
base mortality tables with a base year of 2006. For valuation dates during 2018,
these base mortality tables are adjusted for mortality improvement using the
mortality improvement rates contained in the Mortality Improvement Scale MP-
2016 Report.
2

Section 1.430(h)(3)-1(f)(2) provides under certain circumstances an option
to apply mortality tables determined in accordance with regulations previously in
effect for purposes of applying the rules of § 430 for the 2018 plan year. Under
§ 1.430(h)(3)-1(f)(2), 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 prior to
amendment by T.D. 9826 (referred to in this notice as former § 1.430(h)(3)-1)
may be used for purposes of applying the rules of § 430 for a valuation date
occurring during 2018 if the plan sponsor: (1) concludes that use of mortality
tables determined in accordance with § 1.430(h)(3)-1 for that 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 for the plan of the intent to
apply the option under §1.430(h)(3)-1(f)(2).
Former § 1.430(h)(3)-1 provided for mortality tables based on the tables
contained in the RP-2000 Mortality Tables Report, adjusted for mortality

1
The RP-2014 Mortality Tables Report, as revised November 2014, is available at
www.soa.org/Research/Experience-Study/pension/research-2014-rp.aspx.
2
The Mortality Improvement Scale MP-2016 Report is available at
www.soa.org/Research/Experience-Study/Pension/research-2016-mp.aspx.

3
improvement. The regulations permitted plan sponsors to apply the projection of
mortality improvement in either of two ways: (1) through use of static tables that
were updated annually to reflect expected improvements in mortality, or (2)
through use of generational tables. Former § 1.430(h)(3)-1(b)(1) generally
required the use of separate tables for annuitant and nonannuitant periods for
large plans (those with over 500 participants as of the valuation date). Sponsors
of small plans (those with 500 or fewer participants as of the valuation date) were
permitted to use combined tables that apply the same mortality rates to both
annuitants and nonannuitants pursuant to former § 1.430(h)(3)-1(b)(2). Former
§ 1.430(h)(3)-1(a)(3) provided that the static mortality tables for valuation dates
occurring in years after 2008 were to be provided in the Internal Revenue
Bulletin.
Rev. Rul. 2007-67, 2007-2 CB 1047, provides that, except as otherwise
stated in future guidance, the applicable mortality table under § 417(e)(3) is a
static mortality table set forth in published guidance that is developed based on a
fixed blend of 50 percent of the static male combined mortality rates and 50
percent of the static female combined mortality rates used under § 1.430(h)(3)-1.
Rev. Rul. 2007-67 also provides that the applicable mortality table for a calendar
year applies to distributions with annuity starting dates that occur during stability
periods that begin during that calendar year.

STATIC MORTALITY TABLES FOR 2018

Section 430

Section 1.430(h)(3)-1(e) provides the static mortality tables that generally
apply for 2018 under section 430(h)(3)(A).

Static mortality tables for 2018 determined in accordance with former
§ 1.430(h)(3)-1 are set forth in Appendix A of this Notice. These static mortality
tables apply under § 430(h)(3)(A): (1) for valuation dates occurring during 2018
with respect to plan years beginning during 2017, and (2) with respect to plan
years beginning during 2018 if the option under § 1.430(h)(3)-1(f)(2) is used for a
plan.

Section 417(e)(3)

The mortality table that applies under § 417(e)(3) for distributions with
annuity starting dates occurring during stability periods beginning in 2018 is set
forth in Appendix B of this Notice. The mortality rates in this table are derived
from the mortality tables specified under § 430(h)(3)(A) for the 2018 plan year
(which are set forth in § 1.430(h)(3)-1(e)) by following the procedures set forth in
Rev. Rul. 2007-67. This mortality table applies to a plan for 2018 (including for
purposes of § 1.430(d)-1(f)(4)(iii)(B)) regardless of whether the option under
§ 1.430(h)(3)-1(f)(2) is used for the plan.

4

Drafting Information

The principal authors of this notice are Arslan Malik and Linda S. F.
Marshall of the Office of the Associate Chief Counsel (Tax Exempt and
Government Entities). For further information regarding this notice, contact
Arslan Malik or Linda Marshall at (202) 317-6700 (not a toll-free number).

5
APPENDIX A

STATIC MORTALITY TABLES DETERMINED UNDER FORMER
§ 1.430(h)(3)-1(c) and (d) (APPLICABLE FOR VALUATION DATES IN 2018
FOR PLAN YEARS BEGINNING IN 2017 OR IF THE OPTION UNDER
§ 1.430(h)(3)-1(f)(2) IS USED)

Age
MALE MALE MALE FEMALE FEMALE FEMALE
2018
Non-
Annuitant
Mortality
Rate
2018
Annuitant
Mortality
Rate
2018
Optional
Combined
Table
for Small
Plans
2018
Non-
Annuitant
Mortality
Rate
2018
Annuitant
Mortality
Rate
2018
Optional
Combined
Table
for Small
Plans
1 0.000327 0.000327 0.000327 0.000293 0.000293 0.000293
2 0.000221 0.000221 0.000221 0.000191 0.000191 0.000191
3 0.000183 0.000183 0.000183 0.000143 0.000143 0.000143
4 0.000143 0.000143 0.000143 0.000107 0.000107 0.000107
5 0.000131 0.000131 0.000131 0.000097 0.000097 0.000097
6 0.000125 0.000125 0.000125 0.000090 0.000090 0.000090
7 0.000120 0.000120 0.000120 0.000085 0.000085 0.000085
8 0.000111 0.000111 0.000111 0.000075 0.000075 0.000075
9 0.000107 0.000107 0.000107 0.000072 0.000072 0.000072
10 0.000109 0.000109 0.000109 0.000072 0.000072 0.000072
11 0.000112 0.000112 0.000112 0.000073 0.000073 0.000073
12 0.000117 0.000117 0.000117 0.000076 0.000076 0.000076
13 0.000123 0.000123 0.000123 0.000080 0.000080 0.000080
14 0.000135 0.000135 0.000135 0.000089 0.000089 0.000089
15 0.000143 0.000143 0.000143 0.000100 0.000100 0.000100
16 0.000151 0.000151 0.000151 0.000107 0.000107 0.000107
17 0.000160 0.000160 0.000160 0.000116 0.000116 0.000116
18 0.000168 0.000168 0.000168 0.000118 0.000118 0.000118
19 0.000176 0.000176 0.000176 0.000115 0.000115 0.000115
20 0.000183 0.000183 0.000183 0.000112 0.000112 0.000112
21 0.000196 0.000196 0.000196 0.000109 0.000109 0.000109
22 0.000208 0.000208 0.000208 0.000110 0.000110 0.000110
23 0.000227 0.000227 0.000227 0.000116 0.000116 0.000116
24 0.000244 0.000244 0.000244 0.000122 0.000122 0.000122
25 0.000270 0.000270 0.000270 0.000130 0.000130 0.000130
26 0.000310 0.000310 0.000310 0.000144 0.000144 0.000144
27 0.000324 0.000324 0.000324 0.000150 0.000150 0.000150
28 0.000333 0.000333 0.000333 0.000158 0.000158 0.000158
29 0.000349 0.000349 0.000349 0.000167 0.000167 0.000167
30 0.000376 0.000376 0.000376 0.000189 0.000189 0.000189
31 0.000423 0.000423 0.000423 0.000236 0.000236 0.000236
32 0.000476 0.000476 0.000476 0.000269 0.000269 0.000269
33 0.000535 0.000535 0.000535 0.000292 0.000292 0.000292
34 0.000595 0.000595 0.000595 0.000312 0.000312 0.000312
35 0.000655 0.000655 0.000655 0.000330 0.000330 0.000330
36 0.000713 0.000713 0.000713 0.000345 0.000345 0.000345

6
Age
MALE MALE MALE FEMALE FEMALE FEMALE
2018
Non-
Annuitant
Mortality
Rate
2018
Annuitant
Mortality
Rate
2018
Optional
Combined
Table
for Small
Plans
2018
Non-
Annuitant
Mortality
Rate
2018
Annuitant
Mortality
Rate
2018
Optional
Combined
Table
for Small
Plans
37 0.000766 0.000766 0.000766 0.000360 0.000360 0.000360
38 0.000790 0.000790 0.000790 0.000376 0.000376 0.000376
39 0.000810 0.000810 0.000810 0.000394 0.000394 0.000394
40 0.000828 0.000828 0.000828 0.000429 0.000429 0.000429
41 0.000847 0.000875 0.000847 0.000470 0.000470 0.000470
42 0.000872 0.000968 0.000873 0.000517 0.000517 0.000517
43 0.000902 0.001108 0.000905 0.000569 0.000569 0.000569
44 0.000938 0.001295 0.000944 0.000625 0.000625 0.000625
45 0.000979 0.001528 0.000991 0.000660 0.000668 0.000660
46 0.001015 0.001808 0.001037 0.000695 0.000754 0.000696
47 0.001053 0.002135 0.001087 0.000728 0.000883 0.000732
48 0.001092 0.002508 0.001143 0.000787 0.001055 0.000796
49 0.001133 0.002928 0.001206 0.000851 0.00127 0.000869
50 0.001174 0.003395 0.001275 0.000952 0.001527 0.000981
51 0.001215 0.003422 0.001325 0.001065 0.001643 0.001099
52 0.001257 0.003406 0.001404 0.001235 0.001861 0.001282
53 0.001346 0.003453 0.001547 0.001433 0.002141 0.001500
54 0.001444 0.003498 0.001709 0.001666 0.002481 0.001763
55 0.001608 0.003655 0.002031 0.001938 0.002889 0.002118
56 0.001815 0.003889 0.002473 0.002260 0.003377 0.002579
57 0.002060 0.004198 0.002868 0.002551 0.003869 0.003000
58 0.002347 0.004607 0.003342 0.002789 0.004341 0.003391
59 0.002592 0.005001 0.003793 0.003050 0.004880 0.003848
60 0.002865 0.005476 0.004336 0.003332 0.005470 0.004391
61 0.003268 0.006169 0.005107 0.003632 0.006104 0.005067
62 0.003594 0.006795 0.005868 0.003946 0.006783 0.005818
63 0.004064 0.007698 0.006936 0.004271 0.007507 0.006704
64 0.004413 0.008518 0.007843 0.004601 0.008288 0.007566
65 0.004756 0.009433 0.008887 0.004934 0.009143 0.008534
66 0.005259 0.010720 0.010349 0.005261 0.010069 0.009645
67 0.005583 0.011867 0.011559 0.005579 0.011063 0.010716
68 0.005695 0.012794 0.012538 0.005886 0.012149 0.011850
69 0.005972 0.014133 0.013900 0.006178 0.013368 0.013100
70 0.006026 0.015219 0.014980 0.006452 0.014770 0.014488
71 0.006827 0.016839 0.016605 0.007035 0.015984 0.015711
72 0.008428 0.018697 0.018483 0.008200 0.017778 0.017518
73 0.010830 0.020825 0.020643 0.009948 0.019270 0.019049
74 0.014033 0.023233 0.023089 0.012278 0.021358 0.021174
75 0.018037 0.026595 0.026484 0.015191 0.022993 0.022860
76 0.022841 0.029643 0.029572 0.018686 0.025332 0.025242
77 0.028446 0.033819 0.033777 0.022764 0.028612 0.028552
78 0.034852 0.038544 0.038525 0.027424 0.031540 0.031512
79 0.042059 0.043933 0.043928 0.032667 0.034821 0.034814

7
Age
MALE MALE MALE FEMALE FEMALE FEMALE
2018
Non-
Annuitant
Mortality
Rate
2018
Annuitant
Mortality
Rate
2018
Optional
Combined
Table
for Small
Plans
2018
Non-
Annuitant
Mortality
Rate
2018
Annuitant
Mortality
Rate
2018
Optional
Combined
Table
for Small
Plans
80 0.050067 0.050067 0.050067 0.038490 0.038490 0.038490
81 0.057467 0.057467 0.057467 0.042601 0.042601 0.042601
82 0.065843 0.065843 0.065843 0.047227 0.047227 0.047227
83 0.073396 0.073396 0.073396 0.052439 0.052439 0.052439
84 0.083709 0.083709 0.083709 0.058321 0.058321 0.058321
85 0.092919 0.092919 0.092919 0.066628 0.066628 0.066628
86 0.103019 0.103019 0.103019 0.076203 0.076203 0.076203
87 0.117040 0.117040 0.117040 0.087152 0.087152 0.087152
88 0.132854 0.132854 0.132854 0.097072 0.097072 0.097072
89 0.146819 0.146819 0.146819 0.110532 0.110532 0.110532
90 0.165921 0.165921 0.165921 0.122153 0.122153 0.122153
91 0.180722 0.180722 0.180722 0.134140 0.134140 0.134140
92 0.200931 0.200931 0.200931 0.146213 0.146213 0.146213
93 0.216754 0.216754 0.216754 0.162113 0.162113 0.162113
94 0.232553 0.232553 0.232553 0.173875 0.173875 0.173875
95 0.254433 0.254433 0.254433 0.185013 0.185013 0.185013
96 0.270045 0.270045 0.270045 0.195353 0.195353 0.195353
97 0.285214 0.285214 0.285214 0.209923 0.209923 0.209923
98 0.307507 0.307507 0.307507 0.218415 0.218415 0.218415
99 0.322050 0.322050 0.322050 0.225671 0.225671 0.225671
100 0.336045 0.336045 0.336045 0.231601 0.231601 0.231601
101 0.358628 0.358628 0.358628 0.244834 0.244834 0.244834
102 0.371685 0.371685 0.371685 0.254498 0.254498 0.254498
103 0.383040 0.383040 0.383040 0.266044 0.266044 0.266044
104 0.392003 0.392003 0.392003 0.279055 0.279055 0.279055
105 0.397886 0.397886 0.397886 0.293116 0.293116 0.293116
106 0.400000 0.400000 0.400000 0.307811 0.307811 0.307811
107 0.400000 0.400000 0.400000 0.322725 0.322725 0.322725
108 0.400000 0.400000 0.400000 0.337441 0.337441 0.337441
109 0.400000 0.400000 0.400000 0.351544 0.351544 0.351544
110 0.400000 0.400000 0.400000 0.364617 0.364617 0.364617
111 0.400000 0.400000 0.400000 0.376246 0.376246 0.376246
112 0.400000 0.400000 0.400000 0.386015 0.386015 0.386015
113 0.400000 0.400000 0.400000 0.393507 0.393507 0.393507
114 0.400000 0.400000 0.400000 0.398308 0.398308 0.398308
115 0.400000 0.400000 0.400000 0.400000 0.400000 0.400000
116 0.400000 0.400000 0.400000 0.400000 0.400000 0.400000
117 0.400000 0.400000 0.400000 0.400000 0.400000 0.400000
118 0.400000 0.400000 0.400000 0.400000 0.400000 0.400000
119 0.400000 0.400000 0.400000 0.400000 0.400000 0.400000
120 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000

8
APPENDIX B

APPLICABLE MORTALITY TABLE FOR DISTRIBUTIONS SUBJECT TO
§ 417(e)(3) WITH ANNUITY STARTING DATES OCCURRING IN
STABILITY PERIODS BEGINNING IN 2018

Age

Mortality Rate
Age

Mortality Rate
Age

Mortality Rate
0 0.002327
1 0.000141 41 0.000368 81 0.042142
2 0.000095 42 0.000400 82 0.047336
3 0.000076 43 0.000439 83 0.053242
4 0.000059 44 0.000486 84 0.059995
5 0.000052 45 0.000541 85 0.067626
6 0.000048 46 0.000608 86 0.076267
7 0.000044 47 0.000685 87 0.086016
8 0.000039 48 0.000775 88 0.096873
9 0.000035 49 0.000877 89 0.108929
10 0.000031 50 0.000995 90 0.122286
11 0.000033 51 0.001116 91 0.136576
12 0.000043 52 0.001267 92 0.151466
13 0.000053 53 0.001442 93 0.166679
14 0.000063 54 0.001645 94 0.182208
15 0.000073 55 0.001951 95 0.197901
16 0.000083 56 0.002348 96 0.215845
17 0.000093 57 0.002701 97 0.234417
18 0.000104 58 0.003092 98 0.253767
19 0.000114 59 0.003526 99 0.273753
20 0.000123 60 0.004029 100 0.294309
21 0.000135 61 0.004629 101 0.315174
22 0.000147 62 0.005297 102 0.336021
23 0.000157 63 0.006056 103 0.356761
24 0.000163 64 0.006793 104 0.377020
25 0.000160 65 0.007601 105 0.396564
26 0.000160 66 0.008513 106 0.415512
27 0.000163 67 0.009419 107 0.433450
28 0.000168 68 0.010399 108 0.450441
29 0.000175 69 0.011477 109 0.466489
30 0.000185 70 0.012664 110 0.481504
31 0.000197 71 0.013995 111 0.491560
32 0.000210 72 0.015486 112 0.498309
33 0.000225 73 0.017176 113 0.501231

9
Age

Mortality Rate
Age

Mortality Rate
Age

Mortality Rate
34 0.000239 74 0.019081 114 0.500577
35 0.000253 75 0.021243 115 0.500000
36 0.000266 76 0.023707 116 0.500000
37 0.000282 77 0.026500 117 0.500000
38 0.000299 78 0.029713 118 0.500000
39 0.000318 79 0.033373 119 0.500000
40 0.000342 80 0.037591 120 1.000000