On August 17, 2012, the IRS issued Notice 2012-55, which provides guidance on the average segment rates used to determine minimum funding requirements for single-employer defined benefit pension plans under IRC Section 430 and ERISA Section 303. The notice reflects changes required by the Moving Ahead for Progress in the 21st Century Act (MAP-21), which was enacted on July 6, 2012.

IRC Section 430 describes the interest rates that are used to calculate the minimum required contributions. The interest rates used for this purpose are a set of three segment rates or, alternatively, a full yield curve. As amended by MAP-21, IRC Section 430(h)(2)(C)(iv) provides that each of the three segment rates must be adjusted to fall within a specified range determined based on a percentage of the average of the corresponding segment rates for a 25-year period ending on September 30 preceding the calendar year that includes the first day of that plan year. The Notice sets out the adjusted average segment rates as well as a description of the methodology used to determine the yield curve and segment rates with sufficient detail to enable plans to make reasonable predictions about future months' yield curve and rates.

The IRS plans to issue additional guidance on other issues related to MAP-21, including guidance on benefit restrictions and transition issues.