On August 7, the Centers for Decease Control and Prevention published mortality tables based on the 2010 census. “U.S. Decennial Life Tables for 2009-2011, United States Life Tables,” National Vital Statistics Reports, Vol. 69, No. 8 (8/7/2020). Table 1 of those life tables is the mortality table that the Internal Revenue Service will now be using to develop new actuarial tables under I.R.C. § 7520.

I.R.C. § 7520 specifies how to value life estates, annuities, and remainders, and it requires the Secretary of the Treasury to publish new actuarial tables every 10 years, based on the most recent mortality information then available. The first actuarial tables under § 7520 were published effective as of May 1, 1989, and were based on the 1980 census. The IRS has published new tables every ten years since then, but was unable to publish new tables in 2019 because the Centers for Disease Control (CDC) had been unable to finish compiling the mortality data from the 2010 census.

Now that the necessary mortality table has been completed, the IRS will begin preparing new actuarial tables, a process that could take six to eight weeks. It is therefore possible that new tables will be published (and effective) by October 1, although the IRS has in the past allowed a two month transition period during which taxpayers could elect to use the previous tables.

The new mortality table shows a significant increase in life expectancy, as much as 1.8 years for the very young, although there appears to be no increase in life expectancy for those 89 or older. For those younger than 89, the new tables will therefore result in smaller charitable remainders for charitable remainder unitrusts, charitable remainder annuity trusts, and charitable gifts of remainder interests in farms. There will be larger values for life estates, and for charitable lead trusts that are measured by lives and not terms of years. Longer life expectancies will also allow smaller payments for both private annuities and self-cancelling installment notes.