The IRS has announced that it is considering changes to the methodology used to determine the adjusted applicable federal rates (AFRs) and the adjusted federal long-term rate, for the following reasons. When the adjustment factor was originally created, it used prime, general obligation tax-exempt bonds, which no longer are perceived to have the same credit quality with U.S. Treasury obligations. As a result, market yields of prime, general obligation tax-exempt bonds often have exceeded the corresponding AFRs. Accordingly, the adjustment factor no longer serves its intended purpose of making adjustments to reflect tax exemption but not credit quality, and are also in conflict with Congress's express intent that the adjusted federal long-term rate and long-term tax-exempt rate be lower than the federal long-term rate.