IRS Released Updated Pension Funding Interest Rates

The latest interest rate guidance impacts minimum funding requirements and benefit calculations for defined benefit pension plans.

Updated on Sept. 18, 2026 in Retirement Planning

Bold flat-color editorial illustration of a geometric brass door hinge, evoking institutional stability and regulatory oversight. — The Internal Revenue Service issued updated interest rate guidance for pension plans, impacting minimum funding requirements and benefit calculations for U.S. employers. AI Illustration. Upload story photo >

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The IRS has issued updated interest rate guidance for pension plan funding and benefit calculations in the United States. These adjustments ensure that plans remain compliant with established statutory minimum and maximum ranges.

Why it matters

These rates are required for determining the minimum funding requirements for single-employer defined benefit plans and calculating the present value of certain pension benefits. Keeping these figures within statutory bounds is essential for long-term plan solvency.

The IRS guidance establishes updated interest rates for I.R.C. §430(h)(2), I.R.C. §431(c)(6), and I.R.C. §417(e)(3) to align with statutory requirements. It is not yet known how these specific rate adjustments will affect the funding status of individual pension plans.

The players

Internal Revenue Service

The federal agency responsible for tax collection and the regulation of retirement plan funding and benefit calculations.

The details

The guidance applies to the corporate bond yield curve, the 30-year Treasury weighted average rate, and minimum present value segment rates. Pension plans must use these figures to determine the present value of participant benefits and the minimum cash contributions required from employers. These rates are adjusted periodically to remain within statutorily prescribed minimum and maximum ranges.

September 18, 2026: The IRS issued updated pension plan funding and interest rates.

Money Landscape

This regulatory update follows the standard cycle of interest rate adjustments required by I.R.C. §430(h)(2). It ensures that pension plans continue to operate within the historical range set by federal statute.

These changes influence the minimum funding requirements for defined benefit plans, which can affect the financial obligations of employers. If you are a beneficiary of a defined benefit pension plan, consider discussing your plan's funding status with a qualified financial professional.

The takeaway

The IRS update ensures that pension funding calculations remain aligned with current statutory interest rate requirements. Review your most recent summary plan description and consult with a professional to understand how your pension plan's funding status might change.