PUBLIC LAW 99-514—OCT. 22, 1986
100 STAT. 2487
(c) EFFECTIVE DATE.—The amendment made by this section shall apply to overstatements made after the date of the enactment of this Act. SEC. 1139. INTEREST RATE ASSUMPTIONS.
(a) IN GENERAL.—Subparagraph (B) of section 411(a)(ll) is amended to read as follows: "(B) DETERMINATION OF PRESENT VALUE.—
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"(i) IN GENERAL.—For purposes of subparagraph (A), the present value shall be calculated— "(I) by using an interest rate no greater than the applicable interest rate if the vested accrued benefit (using such rate) is not in excess of $25,000, and "(II) by using an interest rate no greater than 120 percent of the applicable interest rate if the ^ vested accrued benefit exceeds $25,000 (as determined under subclause (I)). In no event shall the present value determined under subclause (II) be less than $25,000. "(ii)
APPLICABLE INTEREST RATE.—For purposes
of
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clause (i), the term 'applicable interest rate' means the interest rate which would be used (as of the date of the distribution) by the Pension Benefit Guaranty Corporation for purposes of determining the present value of a lump sum distribution on plan termination." O> CONFORMING AMENDMENT.—Paragraph (3) of section 417(e) t) (relating to determination of present value) is amended to read as follows: "(3) DETERMINATION OF PRESENT VALUE.—
"(A) IN GENERAL.—For purposes of paragraphs (1) and (2), the present value shall be calculated— "(i) by using an interest rate no greater than the applicable interest rate if the vested accrued benefit (using such rate) is not in excess of $25,000, and "(ii) by using an interest rate no greater than 120 percent of the applicable interest rate if the vested accrued benefit exceeds $25,000 (as determined under clause (i)). In no event shall the present value determined under subclause (II) be less than $25,000. "(B) APPLICABLE INTEREST RATE.—For purposes of subparagraph (A), the term 'applicable interest rate' means the interest rate which would be used (as of the date of the distribution) by the Pension Benefit Guaranty Corporation for purposes of determining the present value of a lump sum distribution on plan termination." (c) AMENDMENTS TO ERISA.—
(1) IN GENERAL.—Paragraph (2) of section 203(e) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1053(e)(2)) is amended to read as follows: "(2)(A) For purposes of paragraph (1), the present value shall be calculated— "(i) by using an interest rate no greater than the applicable interest rate if the vested accrued benefit (using such rate) is not in excess of $25,000, and
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