Permission Granted to Use Substitute Mortality Tables

Significant Index No. 0430.00-00

Date: November 27, 2018

Refer Reply To: SE:T:EP:RA:A2

Re: Substitute Mortality Table Ruling

LEGEND:

Taxpayer = * * *
(EIN: * * *)
Plan A = * * *
(EIN: * * *; Plan No. * * *)
Plan B = * * *
(EIN: * * *; Plan No. * * *)
Plan C = * * *
(EIN: * * *; Plan No. * * *)
Plan D = * * *
(EIN: * * *; Plan No. * * *)
Plan E = * * *
(EIN: * * *; Plan No. * * *)

Dear * * *:

This letter is to inform you that your request to use substitute mortality tables for making computations under section 430 of the Internal Revenue Code (the “Code”) for Plan E has been granted with respect to the populations specified in this letter, subject to the conditions outlined herein. This ruling is effective for a period of 10 plan years beginning with the plan year commencing January 1, * * *. Your request has been granted in accordance with section 430(h)(3) of the Code and section 303(h)(3) of the Employee Retirement Income Security Act of 1974.

This approval applies to the following specific populations. The substitute mortality tables will also apply to the disabled participants in these populations.

• Male annuitants

• Female annuitants

• Male nonannuitants

In granting this approval, we have only considered whether the substitute mortality rates were developed in accordance with section 1.430(h)(3)-2 of the Treasury Regulations ("Regulations”) and Revenue Procedure 2017-55. Accordingly, we are not expressing any opinion as to the accuracy or acceptability of any calculations or other material submitted with your request.

Permission is hereby granted to use the substitute mortality rates shown in the table below for the populations in the Plan E.

During the study period, Plans A through E existed separately and were aggregated in accordance with section 1.430(h)(3)-2(c)(5) of the Regulations. Plans A through D were subsequently merged into Plan E. A request seeking approval to change one or more funding methods has not been received by the Internal Revenue Service.

The above rates were developed using a 2-year experience study period, with a base year of * * * The rates were calculated by adjusting the applicable standard mortality tables in section 1.430(h)(3)-1(d) of the Regulations indicated in the table below, using the mortality ratio and credibility weighting factor individually determined for each population, as shown in the table below.

The Internal Revenue Service has reviewed the substitute mortality rates and supporting information, and has determined that based on the information submitted, the rates were developed in accordance with section 1.430(h)(3)-2 of the Regulations and Revenue Procedure 2017-55.

The above rates must be applied on a generational basis, as provided in section 1.430(h)(3)-2(c)(3) of the Regulations.

This ruling has been granted subject to the following condition. In order to continue using the substitute mortality tables for making computations under section 430(h) of the Code, the following information must be provided by the October 15^th * * * immediately following the end of each plan year, beginning with the * * * plan year (due October 15, * * *). This condition is required because certain segments of the population have changed significantly from the population that existed during the experience study period, most notable male nonannuitants, and further changes can be expected.

This information must be provided to David M. Ziegler (or to another individual designated by the Service), by Fax at (202) 317-8811, or to the following address:

Failure to provide this information by the due date may result in the requirement that the standard mortality tables must be used for purposes of section 430 of the Code, beginning with the plan year during which the deadline for providing this information is missed.

Your attention is called to section 430(h)(3)(C)(ii) of the Code and section 1.430(h)(3)-2(d)(6) of the Regulations, which describe the circumstances in which the use of the substitute mortality table will terminate before the end of the 10-year period described above. In general, the substitute mortality tables can no longer be used as of the earliest of:

We draw your attention to the fact that the female nonannuitants experienced * * * deaths during the experience study period (using the simplified rule described in section 1.430(h)(3)-2(c)(2)(ii)(B) of the Regulations). Note that this population will have credible mortality experience if it experiences at least * * * deaths during a 2-year period (corresponding to the length of the experience study used to construct the substitute mortality tables for the other populations). It is important to monitor this population to ensure that appropriate action is taken should this occur, to avoid violating paragraph (2) above.

This ruling is directed only to the taxpayer that requested it. Section 6110(k)(3) of the Code provides that it may not be used or cited by others as precedent.

When filing Form 5500 for the plan years for which the substitute mortality tables are used, please note the information that is required to be attached to Schedule SB (Actuarial Information) in accordance with the instructions to that form.

We have sent a copy of this letter to your authorized representative pursuant to a power of attorney (Form 2848) on file in this office and to the Manager, EP Classification in Columbus, Ohio and to the Manager, EP Compliance Unit in Chicago, Illinois.

If you require further assistance in this matter, please contact * * * (ID # * * *) at * * *.

Sincerely,

David M. Ziegler, Manager
Employee Plans Actuarial Group 2

cc:
* * *