Interest rates; underpayments and overpayments. The rates for interest determined under section 6621 of the Code for the calendar quarter beginning July 1, 2012, will be 3 percent for overpayments (2 percent in the case of a corporation), 3 percent for the underpayments, and 5 percent for large corporate underpayments. The rate of interest paid on the portion of a corporate overpayment exceeding $10,000 will be 0.5 percent.

This notice provides guidance on the limits in section 125(i) of the Code on salary reduction contributions to health flexible spending arrangements, effective for cafeteria plan years beginning after December 31, 2012, and also requests comments on possible modification to the “use-or-lose” rule in the proposed section 125 regulations.

Credit for carbon dioxide sequestration; 2012 section 45Q inflation adjustment factor. This notice publishes the inflation adjustment factor for the carbon dioxide (CO2) sequestration credit under section 45Q of the Code for calendar year 2012.

Weighted average interest rate update; corporate bond indices; 30-year Treasury securities; segment rates. This notice contains updates for the corporate bond weighted average interest rate for plan years beginning in June 2012; the 24-month average segment rates; the funding transitional segment rates applicable for June 2012; and the minimum present value transitional rates for May 2012.

Tips included for both employee and employer taxes. This ruling provides guidance for employers and employees in a question and answer format regarding taxes imposed on tips under the Federal Insurance Contributions Act (FICA), including information on the difference between tips and service charges, the reporting of the employer share of FICA under section 3121(q) of the Code, and the section 45B credit. See related Announcement 2012-25, published elsewhere in this Bulletin. Rev. Rul. 95-7 modified and superseded.

This announcement is seeking comments from the public regarding an interim guidance memo (IGM) issued to its examiners relating to Rev. Rul. 2012-18, published elsewhere in this Bulletin. The IGM provides audit issue direction to examiners in dealing with issues concerning the proper treatment of tips and service charges. This announcement also announces plans to solicit comments in the future regarding possible changes to voluntary tip compliance agreements.

Tips included for both employee and employer taxes. This ruling provides guidance for employers and employees in a question and answer format regarding taxes imposed on tips under the Federal Insurance Contributions Act (FICA), including information on the difference between tips and service charges, the reporting of the employer share of FICA under section 3121(q) of the Code, and the section 45B credit. See related Announcement 2012-25, published elsewhere in this Bulletin. Rev. Rul. 95-7 modified and superseded.

This notice provides an extension of time to pay under section 6651 of the Code to eligible civilian spouses of military servicemembers who work in American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, or the U.S. Virgin Islands (each a “U.S. territory”) and claim residence or domicile for tax purposes in a State or the District of Columbia pursuant to the Military Spouses Residency Relief Act (“MSRRA”), for tax year 2011 and subsequent tax years. In addition, this notice provides that civilian spouses of military servicemembers working in a State or the District of Columbia but claiming residence or domicile for tax purposes in a U.S. territory under MSRRA should follow the procedures described in Notice 2010-30 with respect to their individual income tax returns for tax year 2011 and subsequent tax years.