rr-18-12.pdf

Preserve advance releases and the authoritative Internal Revenue Bulletin rendition; directory timestamps are file-publication metadata, not legal effective dates. HTML bulletins begin June 2003; earlier available issues require full PDF parsing.

This collection currently includes the publisher’s available advance-release directory. Historical bulletin renditions are discovered separately; an advance-release record alone does not certify the collection archive complete.

Section 1274.--Determination of Issue Price in the Case of Certain Debt Instruments
Issued for Property

(Also Sections 42, 280G, 382, 467, 468, 482, 483, 1288, 7520.)

Rev. Rul. 2018-12

This revenue ruling provides various prescribed rates for federal
income tax purposes for May 2018 (the current month). Table 1 contains
the short-term, mid-term, and long-term applicable federal rates (AFR) for
the current month for purposes of section 1274(d) of the Internal Revenue
Code. Table 2 contains the short-term, mid-term, and long-term adjusted
applicable federal rates (adjusted AFR) for the current month for purposes
of section 1288(b). Table 3 sets forth the adjusted federal long-term rate
and the long-term tax-exempt rate described in section 382(f). Table 4
contains the appropriate percentages for determining the low-income
housing credit described in section 42(b)(1) for buildings placed in service
during the current month. However, under section 42(b)(2), the applicable
percentage for non-federally subsidized new buildings placed in service
after July 30, 2008, shall not be less than 9%. Finally, Table 5 contains
the federal rate for determining the present value of an annuity, an interest
for life or for a term of years, or a remainder or a reversionary interest for
purposes of section 7520.

2
REV. RUL. 2018-12 TABLE 1

Applicable Federal Rates (AFR) for May 2018

Period for Compounding
Annual Semiannual Quarterly Monthly

Short-term

AFR 2.18% 2.17% 2.16% 2.16%
110% AFR 2.40% 2.39% 2.38% 2.38%
120% AFR 2.62% 2.60% 2.59% 2.59%
130% AFR 2.84% 2.82% 2.81% 2.80%

Mid-term

AFR 2.69% 2.67% 2.66% 2.66%
110% AFR 2.96% 2.94% 2.93% 2.92%
120% AFR 3.23% 3.20% 3.19% 3.18%
130% AFR 3.50% 3.47% 3.46% 3.45%
150% AFR 4.05% 4.01% 3.99% 3.98%
175% AFR 4.72% 4.67% 4.64% 4.63%

Long-term

AFR 2.94% 2.92% 2.91% 2.90%
110% AFR 3.24% 3.21% 3.20% 3.19%
120% AFR 3.53% 3.50% 3.48% 3.47%
130% AFR 3.84% 3.80% 3.78% 3.77%

3
REV. RUL. 2018-12 TABLE 2

Adjusted AFR for May 2018

Period for Compounding
Annual Semiannual Quarterly Monthly
Short-term
adjusted AFR 1.66% 1.65% 1.65% 1.64%

Mid-term
adjusted AFR 2.04% 2.03% 2.02% 2 .02%

Long-term
adjusted AFR 2.23% 2.22% 2.21% 2.21%

REV. RUL. 2018-12 TABLE 3

Rates Under Section 382 for May 2018

Adjusted federal long-term rate for the current month 2.23%

Long-term tax-exempt rate for ownership changes during the
current month (the highest of the adjusted federal long-term
rates for the current month and the prior two months.) 2.30%

4
REV. RUL. 2018-12 TABLE 4

Appropriate Percentages Under Section 42(b)(1) for May 2018
Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized
new buildings placed in service after July 30, 2008, shall not be less than 9%.

Appropriate percentage for the 70% present value low-income
housing credit 7.65%

Appropriate percentage for the 30% present value low-income
housing credit 3.28%

REV. RUL. 2018-12 TABLE 5

Rate Under Section 7520 for May 2018

Applicable federal rate for determining the present value of an
annuity, an interest for life or a term of years, or a remainder or
reversionary interest 3.2%