Comment on FR Doc # 07-02631

I'm writing on behalf of the 21 enrolled actuaries at Principal Financial Group. We provide actuarial services for approximately 1100 defined benefit plans. We have the following comments concerning the proposed IRS regulations for "Mortality Tables for Determining Present Value" that will be used for valuations starting in 2008. 1. Please clarify whether plan sponsors are allowed to change each year to the static or generational (or static combined, if small plan) table for that year regardless of which table was used in the previous year. We would agree with providing this flexibility. 2. Under the new funding rules added by PPA, please clarify whether there will still be the option to use no pre retirement mortality for very small plans (possibly less than 100 participants). We support this option. 3. Please clarify the use of non-annuitant and annuitant mortality for ancillary benefits. For example, for a disability benefit that is deferred to retirement date, our opinion is that the annuitant table should be used although the actual payout doesn't occur until retirement. An alternate approach would be to use non-annuitant rates until the actual benefit payments begin. For Qualified Preretirement Spouse Annuities and similar death benefits, we would use the non-annuitant table for the spouse after the death of the participant until payments begin at the early retirement age of the participant. Annuitant rates would be used after payment begins. An alternate approach would be to consider that the benefit is in pay status after any decrement, including death. Under this approach, annuitant rates would also be used for the period from death to actual payout. 4. On the question of whether the IRS should publish a series of static tables (such as 5 years) or one table each year, we would be in favor of seeing a series of tables. This will allow more time to build tables for subsequent years. 5. How should the table be modified for use in applying the minimum present value rules of section 417(e)(3)? We would be in favor of using static tables rather than the more complex generational mortality. Static tables are more easily communicated to participants and plan sponsors. Because small amounts are paid at younger ages prior to retirement, we think the combined table would be appropriate for this purpose rather than the annuitant table. 6. Are the proposed regulations clear and understandable? For the most part, yes, with some clarification needed as noted above. Thank you for your consideration of these comments. Karen V. Claypool Actuary Retirement Actuarial Services Principal Financial Group Ph.1-800-543-4015 ext. 75794 or 515-247-5794 claypool.karen@principal.com