rr-21-04.pdf

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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, 7872.)

Rev. Rul. 2021-4

This revenue ruling provides various prescribed rates for federal income tax
purposes for February 2021 (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.

REV. RUL. 2021-4 TABLE 1

2

Applicable Federal Rates (AFR) for February 2021

Period for Compounding
Annual Semiannual Quarterly Monthly

Short-term

AFR 0.12% 0.12% 0.12% 0.12%
110% AFR 0.13% 0.13% 0.13% 0.13%
120% AFR 0.14% 0.14% 0.14% 0.14%
130% AFR 0.16% 0.16% 0.16% 0.16%

Mid-term

AFR 0.56% 0.56% 0.56% 0.56%
110% AFR 0.62% 0.62% 0.62% 0.62%
120% AFR 0.67% 0.67% 0.67% 0.67%
130% AFR 0.73% 0.73% 0.73% 0.73%
150% AFR 0.84% 0.84% 0.84% 0.84%
175% AFR 0.98% 0.98% 0.98% 0.98%

Long-term

AFR 1.46% 1.45% 1.45% 1.45%
110% AFR 1.61% 1.60% 1.60% 1.59%
120% AFR 1.75% 1.74% 1.74% 1.73%
130% AFR 1.90% 1.89% 1.89% 1.88%

REV. RUL. 2021-4 TABLE 2

3
Adjusted AFR for February 2021

Period for Compounding
Annual Semiannual Quarterly Monthly
Short-term
adjusted AFR 0.09% 0.09% 0.09% 0.09%

Mid-term
adjusted AFR 0.43% 0.43% 0.43% 0.43%

Long-term
adjusted AFR 1.10% 1.10% 1.10% 1.10%

REV. RUL. 2021-4 TABLE 3

Rates Under Section 382 for February 2021

Adjusted federal long-term rate for the current month 1.10%

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.) 1.10%

REV. RUL. 2021-4 TABLE 4

Appropriate Percentages Under Section 42(b)(1) for February 2021
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 7.23%

Appropriate percentage for the 30% present value low-income
housing credit 3.10%

REV. RUL. 2021-4 TABLE 5

Rate Under Section 7520 for February 2021

4

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 . 6%