Notice 2011-83

of continuing education credits, including two hours of ethics or professional
conduct, three hours of federal tax law
updates, and ten hours of federal tax law
topics during each registration year.
a. Continuing Education Requirements
to be Completed on a Calendar Year
Basis
The IRS has determined that registered
tax return preparers must complete their
continuing education requirements on a
calendar year basis. The IRS will require registered tax return preparers (and
provisional PTIN holders) to satisfy continuing education requirements beginning
in 2012. Therefore, except as set forth in
section 4b of this notice, registered tax
return preparers must complete continuing
education requirements as prescribed in
section 10.6(e)(3) of Circular 230 between
January 1st and December 31st of each
year beginning in 2012.
b. Continuing Education Requirements
Prorated for Individuals Who Initially
Become a Registered Tax Return
Preparer During the Registration Year
Continuing education requirements for
individuals who initially become a registered tax return preparer after January 31st
will be prorated for the initial registration
year. These individuals will be required to
complete one hour of continuing education
credit regarding federal tax law updates or
federal tax law topics for each month or
portion of a month that the individual is a
registered tax return preparer. In addition,
these individuals will be required to complete two hours of ethics credits regardless
of when the individual becomes a registered tax return preparer. For example, an
individual who initially becomes a registered tax return preparer on April 20th is
required to complete two hours of ethics
credits plus 9 hours of credits regarding
federal tax law or federal tax law updates.
Except in the case of a waiver under section 10.6(i) of Circular 230, continuing education requirements will not be prorated
after the initial application year. Individuals who do not timely renew their PTIN
before December 31st ordinarily will not
qualify for a waiver and must complete all
of the continuing education hours required
in section10.6(e)(3) of Circular 230.

October 24, 2011

Contact Information
The principal author of this notice
is Emily M. Lesniak of the Office of
Associate Chief Counsel (Procedure
and Administration).
For further
information regarding this notice, contact
Emily M. Lesniak at (202) 622–4570 (not
a toll-free call).

Pennsylvania Low-Income
Housing Credit Disaster Relief
Notice 2011–83
The Internal Revenue Service is suspending certain requirements under § 42 of
the Internal Revenue Code for low-income
housing credit projects to provide emergency housing relief needed as a result of
the devastation in Pennsylvania caused by
either Hurricane Irene during the period of
August 26, 2011 to August 30, 2011, or
Tropical Storm Lee beginning on September 3, 2011. This relief is being granted
pursuant to the Service’s authority under
§ 42(n) and § 1.42–13(a) of the Income Tax
Regulations.
BACKGROUND
On September 3,
2011,
and
September 12, 2011, the President
declared major disasters for the
Commonwealth of Pennsylvania. The
declarations were made under the Robert
T. Stafford Disaster Relief and Emergency
Assistance Act, 42 U.S.C. 5121 et seq.
Subsequently, the Federal Emergency
Management Agency (FEMA) designated
jurisdictions for Individual Assistance.
The Commonwealth of Pennsylvania
has requested that the Service allow
owners of low-income housing credit
projects to provide temporary housing in
vacant units to individuals who resided
in jurisdictions designated for Individual
Assistance in Pennsylvania and who have
been displaced because their residences
were destroyed or damaged as a result of
the devastation caused by Hurricane Irene
or Tropical Storm Lee. Based upon this
request and because of the widespread
damage to housing caused by Hurricane
Irene and Tropical Storm Lee, the Service
has determined that the Pennsylvania
Housing Finance Agency (Agency) may

593

provide approval to project owners to
provide temporary emergency housing for
displaced individuals in accordance with
this notice.
I. SUSPENSION OF INCOME
LIMITATIONS
The Service has determined that it is
appropriate to temporarily suspend certain
income limitation requirements under § 42
for certain qualified low-income projects.
The suspension will apply to low-income
housing projects approved by the Agency,
in which vacant units are rented to displaced individuals. The Agency will determine the appropriate period of temporary
housing for each project, not to extend beyond October 31, 2012 (temporary housing period).
II. STATUS OF UNITS
A. Units in the first year of the credit
period
A displaced individual temporarily
occupying a unit during the first year of
the credit period under § 42(f)(1) will be
deemed a qualified low-income tenant
for purposes of determining the project’s
qualified basis under § 42(c)(1), and for
meeting the project’s 20–50 test or 40–60
test as elected by the project owner under
§ 42(g)(1). After the end of the temporary
housing period established by the Agency
(not to extend beyond October 31, 2012),
a displaced individual will no longer be
deemed a qualified low-income tenant.
B. Vacant units after the first year of the
credit period
During the temporary housing period
established by the Agency, the status of a
vacant unit (that is, market-rate or low-income for purposes of § 42 or never previously occupied) after the first year of the
credit period that becomes temporarily occupied by a displaced individual remains
the same as the unit’s status before the
displaced individual moves in. Displaced
individuals temporarily occupying vacant
units will not be treated as low-income
tenants under § 42(i)(3)(A)(ii). However,
even if it houses a displaced individual, a
low-income or market rate unit that was
vacant before the effective date of this notice will continue to be treated as a va-

2011–43 I.R.B.

cant low-income or market rate unit. Similarly, a unit that was never previously occupied before the effective date of this notice will continue to be treated as a unit
that has never been previously occupied
even if it houses a displaced individual.
Thus, the fact that a vacant unit becomes
occupied by a displaced individual will
not affect the building’s applicable fraction under § 42(c)(1)(B) for purposes of
determining the building’s qualified basis,
nor will it affect the 20–50 test or 40–60
test of § 42(g)(1). If the income of occupants in low-income units exceeds 140
percent of the applicable income limitation, the temporary occupancy of a unit by
a displaced individual will not cause application of the available unit rule under
§ 42(g)(2)(D)(ii). In addition, the project
owner is not required during the temporary
housing period to make attempts to rent
to low-income individuals the low-income
units that house displaced individuals.
III. SUSPENSION OF
NON-TRANSIENT REQUIREMENTS
The non-transient use requirement of
§ 42(i)(3)(B)(i) shall not apply to any
unit providing temporary housing to a
displaced individual during the temporary
housing period determined by the Agency
in accordance with section I of this notice.
IV. OTHER REQUIREMENTS
All other rules and requirements of
§ 42 will continue to apply during the
temporary housing period established
by the Agency. After the end of the
temporary housing period, the applicable income limitations contained in
§ 42(g)(1), the available unit rule under § 42(g)(2)(D)(ii), the nontransient
requirement of § 42(i)(3)(B)(i), and the
requirement to make reasonable attempts
to rent vacant units to low-income individuals shall resume. If a project owner offers
to rent a unit to a displaced individual after
the end of the temporary housing period,
the displaced individual must be certified
under the requirements of § 42(i)(3)(A)(ii)
and § 1.42–5(b) and (c) to be a qualified
low-income tenant. To qualify for the relief in this notice, the project owner must
additionally meet all of the following requirements:
(1) Major Disaster Area

2011–43 I.R.B.

In the case of an individual displaced by
the devastation caused by Hurricane Irene,
the displaced individual must have resided
in a Pennsylvania jurisdiction designated
for Individual Assistance by FEMA as a
result of the devastation in Pennsylvania
caused by Hurricane Irene during the period of August 26, 2011, to August 30,
2011.
In the case of an individual displaced
by the devastation caused by Tropical
Storm Lee, the displaced individual must
have resided in a Pennsylvania jurisdiction designated for Individual Assistance
by FEMA as a result of the devastation in
Pennsylvania caused by Tropical Storm
Lee beginning on September 3, 2011.
(2) Approval of the Pennsylvania Housing Finance Agency
The project owner must obtain approval
from the Agency for the relief described
in this notice. The Agency will determine
the appropriate period of temporary housing for each project, not to extend beyond
October 31, 2012.
(3) Certifications and Recordkeeping
To comply with the requirements of
§ 1.42–5, project owners are required to
maintain and certify certain information
concerning each displaced individual temporarily housed in the project, specifically
the following: name, address of damaged
residence, social security number, and a
statement signed under penalties of perjury
by the displaced individual that, because
of damage to the individual’s residence in
a Pennsylvania jurisdiction designated for
Individual Assistance by FEMA as a result
of the devastation caused in Pennsylvania
by Hurricane Irene during the period of
August 26, 2011 to August 30, 2011, or
Tropical Storm Lee beginning on September 3, 2011, as applicable, the individual
requires temporary housing. The owner
must notify the Agency that vacant units
are available for rent to displaced individuals.
The owner must also certify the date the
displaced individual began temporary occupancy and the date the project will discontinue providing temporary housing as
established by the Agency. The certifications and recordkeeping for displaced individuals must be maintained as part of
the annual compliance monitoring process
with the Agency.
(4) Rent Restrictions

594

Rents for the low-income units that
house displaced individuals must not exceed the existing rent-restricted rates for
the low-income units established under
§ 42(g)(2).
(5) Protection of Existing Tenants
Existing tenants in occupied low-income units cannot be evicted or have their
tenancy terminated as a result of efforts to
provide temporary housing for displaced
individuals.
EFFECTIVE DATES
This notice is effective September 3,
2011 (the date of the President’s major disaster declaration) for devastation
caused by Hurricane Irene in Pennsylvania during the period of August 26,
2011 to August 30, 2011. This notice
is effective September 12, 2011 (the
date of the President’s major disaster
declaration) for devastation caused by
Tropical Storm Lee in Pennsylvania
beginning on September 3, 2011.
PAPERWORK REDUCTION ACT
The collection of information contained
in this notice has been reviewed and approved by the Office of Management and
Budget in accordance with the Paperwork
Reduction Act (44 U.S.C. 3507) under
control number 1545–2218.
An Agency may not conduct or sponsor,
and a person is not required to respond
to, a collection of information unless the
collection of information displays a valid
OMB control number.
The collection of information in this
notice is in the section titled “OTHER
REQUIREMENTS” under “(3) Certifications and Recordkeeping.” This information is required to enable the Service to
verify whether individuals are displaced
as a result of the devastation caused in
Pennsylvania by either Hurricane Irene
during the period of August 26, 2011
to August 30, 2011, or Tropical Storm
Lee beginning on September 3, 2011,
and thus warrant temporary housing in
vacant low-income housing units. The
collection of information is required to
obtain a benefit. The likely respondents
are individuals and businesses.
The estimated total annual recordkeeping burden is 150 hours.
The estimated annual burden per
recordkeeper is approximately 15 minutes.

October 24, 2011

The estimated number of recordkeepers is
600.
Books or records relating to a collection
of information must be retained as long
as their contents may become material to
the administration of the internal revenue
law. Generally, tax returns and tax return
information are confidential, as required
by 26 U.S.C. 6103.
DRAFTING INFORMATION
The principal author of this notice is
David Selig of the Office of Associate
Chief Counsel (Passthroughs & Special
Industries).
For further information
regarding this notice, contact Mr. Selig at
(202) 622–3040 (not a toll-free call).

Update for Weighted Average
Interest Rates, Yield Curves,
and Segment Rates
Notice 2011–84
This notice provides guidance as to the
corporate bond weighted average interest
rate and the permissible range of interest
rates specified under § 412(b)(5)(B)(ii)(II)

For Plan Years
Beginning in

of the Internal Revenue Code as in effect for plan years beginning before 2008.
It also provides guidance on the corporate bond monthly yield curve (and
the corresponding spot segment rates),
and the 24-month average segment rates
under § 430(h)(2). In addition, this notice provides guidance as to the interest
rate on 30-year Treasury securities under § 417(e)(3)(A)(ii)(II) as in effect for
plan years beginning before 2008, the
30-year Treasury weighted average rate
under § 431(c)(6)(E)(ii)(I), and the minimum present value segment rates under
§ 417(e)(3)(D) as in effect for plan years
beginning after 2007.
CORPORATE BOND WEIGHTED
AVERAGE INTEREST RATE
Sections
412(b)(5)(B)(ii)
and
412(l)(7)(C)(i), as amended by the Pension Funding Equity Act of 2004 and by
the Pension Protection Act of 2006 (PPA),
provide that the interest rates used to calculate current liability and to determine
the required contribution under § 412(l)
for plan years beginning in 2004 through
2007 must be within a permissible range
based on the weighted average of the rates

Month

Year

Corporate
Bond Weighted
Average

October

2011

5.86

YIELD CURVE AND SEGMENT
RATES
Generally for plan years beginning
after 2007 (except for delayed effective
dates for certain plans under sections 104,
105, and 106 of PPA), § 430 of the Code
specifies the minimum funding requirements that apply to single employer plans
pursuant to § 412. Section 430(h)(2) specifies the interest rates that must be used
to determine a plan’s target normal cost
and funding target. Under this provision,
present value is generally determined using three 24-month average interest rates

(“segment rates”), each of which applies
to cash flows during specified periods.
However, an election may be made under
§ 430(h)(2)(D)(ii) to use the monthly yield
curve in place of the segment rates. Section 430(h)(2)G) set forth a transitional
rule applicable to plan years beginning in
2008 and 2009 under which the segment
rates were blended with the corporate bond
weighted average described above, including an election under § 430(h)(2)(G)(iv)
for an employer to use the segment rates
without the transitional rule.
Notice 2007–81, 2007–2 C.B. 899,
provides guidelines for determining the

of interest on amounts invested conservatively in long term investment grade
corporate bonds during the 4-year period
ending on the last day before the beginning
of the plan year.
Notice 2004–34, 2004–1 C.B. 848, provides guidelines for determining the corporate bond weighted average interest rate
and the resulting permissible range of interest rates used to calculate current liability. That notice establishes that the corporate bond weighted average is based on the
monthly composite corporate bond rate derived from designated corporate bond indices. The methodology for determining
the monthly composite corporate bond rate
as set forth in Notice 2004–34 continues to
apply in determining that rate. See Notice
2006–75, 2006–2 C.B. 366.
The composite corporate bond rate for
September 2011 is 4.82 percent. Pursuant
to Notice 2004–34, the Service has determined this rate as the average of the
monthly yields for the included corporate
bond indices for that month.
The following corporate bond weighted
average interest rate was determined for
plan years beginning in the month shown
below.

Permissible Range
90%
5.28

to

5.86

monthly corporate bond yield curve, and
the 24-month average corporate bond segment rates used to compute the target normal cost and the funding target. Pursuant
to Notice 2007–81, the monthly corporate
bond yield curve derived from September
2011 data is in Table I at the end of this
notice. The spot first, second, and third
segment rates for the month of September
2011 are, respectively, 1.98, 4.49, and
5.80. The three 24-month average corporate bond segment rates applicable for
October 2011 are as follows:

First
Segment

Second
Segment

Third
Segment

2.03

5.20

6.30

October 24, 2011

595

100%

2011–43 I.R.B.