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October 15, 2014 Interest Rate Update

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October 15, 2014

For Lump Sum Payments

The immediate interest rate for valuing lump sum payments for the month of November 2014 is 1.25% and the deferred interest rate I1 is 4.00%, I2 is 4.00%, and I3 is 4.00%.

For Variable-Rate Premiums

The spot first, second, and third segment rates for September 2014 are, respectively, 1.40%, 3.98%, and 5.04%. These rates are used to determine the variable rate premium for premium payment years commencing in October 2014 if (A) the plan is using the standard premium funding target and (B) the plan is not a small plan using the lookback rule (see Premium Instructions).

For ERISA 4044 Annuities

The select and ultimate interest rates for valuing annuity benefits in single-employer plans and multiemployer plans for the month of November 2014 are 3.10% for the first 20 years following the date of plan termination, and 3.29% thereafter.

For Late Premium Payments

The interest rate that PBGC will charge on employer liability, unpaid contributions, and unpaid premiums, for the calendar quarter beginning October 1, and ending December 31, 2014, is 3.00%.

For Overdue or Defaulted Withdrawal Liability

The interest rate to be charged by multiemployer pension plans on withdrawal liability payments that are overdue or in default, or that is to be credited by such plans on overpayments of withdrawal liability during the calendar quarter beginning October 1, and ending December 31, 2014, is 3.25%.

This page was updated on October 15, 2014.