Rule2023-25049
Consumer Leasing (Regulation M)
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 29, 2023
Effective
January 1, 2024
Issuing agencies
Federal Reserve SystemConsumer Financial Protection Bureau
Abstract
The Board and the Bureau (collectively, the Agencies) are finalizing amendments to the official interpretations and commentary for the Agencies' regulations that implement the Consumer Leasing Act (CLA). The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) amended the CLA by requiring that the dollar threshold for exempt consumer leases be adjusted annually by the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Under regulations adopted by the Agencies, if there is no annual percentage increase in the CPI-W, the Agencies will not adjust this exemption threshold from the prior year. Additionally, in years following a year in which the exemption threshold was not adjusted because the CPI-W decreased, the threshold is calculated by applying the annual percentage change in the CPI-W to the dollar amount that would have resulted, after rounding, if the decreases and any subsequent increases in the CPI-W had been taken into account. Based on the annual percentage increase in the CPI-W as of June 1, 2023, the exemption threshold will increase from $66,400 to $69,500 effective January 1, 2024. Because the Dodd-Frank Act also requires similar adjustments in the Truth in Lending Act's threshold for exempt consumer credit transactions, the Agencies are making similar amendments to each of their respective regulations implementing the Truth in Lending Act elsewhere in the Rules section of this issue of the Federal Register.
Full Text
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<title>Federal Register, Volume 88 Issue 228 (Wednesday, November 29, 2023)</title>
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[Federal Register Volume 88, Number 228 (Wednesday, November 29, 2023)]
[Rules and Regulations]
[Pages 83318-83322]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-25049]
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FEDERAL RESERVE SYSTEM
12 CFR Part 213
[Docket No. R-1821]
RIN 7100-AG70
CONSUMER FINANCIAL PROTECTION BUREAU
12 CFR Part 1013
Consumer Leasing (Regulation M)
AGENCY: Board of Governors of the Federal Reserve System (Board) and
Consumer Financial Protection Bureau (Bureau).
ACTION: Final rules, official interpretations, and commentary.
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SUMMARY: The Board and the Bureau (collectively, the Agencies) are
finalizing amendments to the official interpretations and commentary
for the Agencies' regulations that implement the Consumer Leasing Act
(CLA). The Dodd-Frank Wall Street Reform and Consumer Protection Act
(Dodd-Frank Act) amended the CLA by requiring that the dollar threshold
for exempt consumer leases be adjusted annually by the annual
percentage increase in the Consumer Price Index for Urban Wage Earners
and Clerical Workers (CPI-W). Under regulations adopted by the
Agencies, if there is no annual percentage increase in the CPI-W, the
Agencies will not adjust this exemption threshold from the prior year.
Additionally, in years following a year in which the exemption
threshold was not adjusted because the CPI-W decreased, the threshold
is calculated by applying the annual percentage change in the CPI-W to
the dollar amount that would have resulted, after rounding, if the
decreases and any subsequent increases in the CPI-W had been taken into
account. Based on the annual percentage increase in the CPI-W as of
June 1, 2023, the exemption threshold will increase from $66,400 to
$69,500 effective January 1, 2024. Because the Dodd-Frank Act also
requires similar adjustments in the Truth in Lending Act's threshold
for exempt consumer credit transactions, the Agencies are making
similar amendments to each of their respective regulations implementing
the Truth in Lending Act elsewhere in the Rules section of this issue
of the Federal Register.
DATES: This final rule is effective January 1, 2024.
FOR FURTHER INFORMATION CONTACT:
Board: Vivian W. Wong, Senior Counsel, Division of Consumer and
Community Affairs, Board of Governors
[[Page 83319]]
of the Federal Reserve System, at (202) 452-3667. For users of TTY-TRS,
please call 711 from any telephone, anywhere in the United States.
Bureau: Anna Boadwee and Adrien Fernandez, Attorney-Advisors,
Office of Regulations, Consumer Financial Protection Bureau, at (202)
435-7700. If you require this document in an alternative electronic
format, please contact <a href="/cdn-cgi/l/email-protection#ca898c9a88958ba9a9afb9b9a3a8a3a6a3beb38aa9acbaa8e4ada5bc"><span class="__cf_email__" data-cfemail="e8abaeb8aab7a98b8b8d9b9b818a8184819c91a88b8e988ac68f879e">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background
The Dodd-Frank Act increased the threshold in the CLA for exempt
consumer leases, and the threshold in the Truth in Lending Act (TILA)
for exempt consumer credit transactions,\1\ from $25,000 to $50,000,
effective July 21, 2011.\2\ In addition, the Dodd-Frank Act requires
that, on and after December 31, 2011, these thresholds be adjusted
annually for inflation by the annual percentage increase in the CPI-W,
as published by the Bureau of Labor Statistics.\3\ In April 2011, the
Board issued a final rule amending Regulation M (which implements the
CLA) consistent with these provisions of the Dodd-Frank Act, along with
a similar final rule amending Regulation Z (which implements TILA)
(collectively, the Board Final Threshold Rules).\4\
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\1\ Although consumer credit transactions above the threshold
are generally exempt, loans secured by real property or by personal
property used or expected to be used as the principal dwelling of a
consumer and private education loans are covered by TILA regardless
of the loan amount. See 12 CFR 226.3(b)(1)(i) (Board) and 12 CFR
1026.3(b)(1)(i) (Bureau).
\2\ Public Law 111-203, section 1100E, 124 Stat. 1376, 2111
(2010).
\3\ Id.
\4\ 76 FR 18349 (Apr. 4, 2011); 76 FR 18354 (Apr. 4, 2011).
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Title X of the Dodd-Frank Act transferred rulemaking authority for
a number of consumer financial protection laws from the Board to the
Bureau, effective July 21, 2011. In connection with this transfer of
rulemaking authority, the Bureau issued its own Regulation M
implementing the CLA, 12 CFR part 1013, substantially duplicating the
Board's Regulation M.\5\ Although the Bureau has the authority to issue
rules to implement the CLA for most entities, the Board retains
authority to issue rules under the CLA for certain motor vehicle
dealers covered by section 1029(a) of the Dodd-Frank Act, and the
Board's Regulation M continues to apply to those entities.\6\
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\5\ See 76 FR 78500 (Dec. 19, 2011); 81 FR 25323 (Apr. 28,
2016).
\6\ Section 1029(a) of the Dodd-Frank Act states: ``Except as
permitted in subsection (b), the Bureau may not exercise any
rulemaking, supervisory, enforcement, or any other authority . . .
over a motor vehicle dealer that is predominantly engaged in the
sale and servicing of motor vehicles, the leasing and servicing of
motor vehicles, or both.'' 12 U.S.C. 5519(a). Section 1029(b) of the
Dodd-Frank Act provides that ``[s]ubsection (a) shall not apply to
any person, to the extent that such person--(1) provides consumers
with any services related to residential or commercial mortgages or
self-financing transactions involving real property; (2) operates a
line of business--(A) that involves the extension of retail credit
or retail leases involving motor vehicles; and (B) in which--(i) the
extension of retail credit or retail leases are provided directly to
consumers; and (ii) the contract governing such extension of retail
credit or retail leases is not routinely assigned to an unaffiliated
third party finance or leasing source; or (3) offers or provides a
consumer financial product or service not involving or related to
the sale, financing, leasing, rental, repair, refurbishment,
maintenance, or other servicing of motor vehicles, motor vehicle
parts, or any related or ancillary product or service.'' 12 U.S.C.
5519(b).
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The Agencies' regulations,\7\ and their accompanying commentaries,
provide that the exemption threshold will be adjusted annually
effective January 1 of each year based on any annual percentage
increase in the CPI-W that was in effect on the preceding June 1. They
further provide that any increase in the threshold amount will be
rounded to the nearest $100 increment. For example, if the annual
percentage increase in the CPI-W would result in a $950 increase in the
threshold amount, the threshold amount will be increased by $1,000.
However, if the annual percentage increase in the CPI-W would result in
a $949 increase in the threshold amount, the threshold amount will be
increased by $900.\8\ Since 2011, the Agencies have adjusted the
Regulation M exemption threshold annually, in accordance with these
rules.
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\7\ 12 CFR 213.2(e)(1) (Board) and 12 CFR 1013.2(e)(1) (Bureau).
\8\ See comments 2(e)-9 in Supplements I of 12 CFR parts 213 and
1013.
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On November 30, 2016, the Agencies published a final rule in the
Federal Register to memorialize the calculation method used by the
Agencies each year to adjust the exemption threshold to ensure that, as
contemplated by section 1100E(b) of the Dodd-Frank Act, the values for
the exemption threshold keep pace with the CPI-W (Regulation M
Adjustment Calculation Rule).\9\ The Regulation M Adjustment
Calculation Rule memorialized the policy that, if there is no annual
percentage increase in the CPI-W, the Agencies will not adjust the
exemption threshold from the prior year. The Regulation M Adjustment
Calculation Rule also provided that, in years following a year in which
the exemption threshold was not adjusted because there was a decrease
in the CPI-W from the previous year, the threshold is calculated by
applying the annual percentage change in the CPI-W to the dollar amount
that would have resulted, after rounding, if the decreases and any
subsequent increases in the CPI-W had been taken into account. If the
resulting amount calculated, after rounding, is greater than the
current threshold, then the threshold effective January 1 the following
year will increase accordingly; if the resulting amount calculated,
after rounding, is equal to or less than the current threshold, then
the threshold effective January 1 the following year will not change,
but future increases will be calculated based on the amount that would
have resulted, after rounding.
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\9\ See 81 FR 86256 (Nov. 30, 2016).
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II. 2024 Adjustment and Commentary Revision
Effective January 1, 2024, the exemption threshold amount is
increased from $66,400 to $69,500. This amount is based on the CPI-W in
effect on June 1, 2023, which was reported on May 10, 2023 (based on
April 2023 data).\10\ The CPI-W is a subset of the CPI-U index (based
on all urban consumers) and represents approximately 30 percent of the
U.S. population. The CPI-W reported on May 10, 2023, reflects a 4.6
percent increase in the CPI-W from April 2022 to April 2023.
Accordingly, the 4.6 percent increase in the CPI-W from April 2022 to
April 2023 results in an exemption threshold amount of $69,500, after
rounding. The Agencies are revising the commentaries to their
respective regulations to add new comment 2(e)-11.xv to state that,
from January 1, 2024, through December 31, 2024, the threshold amount
is $69,500. These revisions are effective January 1, 2024.
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\10\ The Bureau of Labor Statistics calculates consumer-based
indices for each month but does not report those indices until the
middle of the following month. As such, the most recently reported
indices as of June 1, 2023, were reported on May 10, 2023, and
reflect economic conditions in April 2023.
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III. Regulatory Analysis
Administrative Procedure Act
Under the Administrative Procedure Act, notice and opportunity for
public comment are not required if the Agencies find that notice and
public comment are impracticable, unnecessary, or contrary to the
public interest.\11\ The amendments in this rule are technical and
apply the method previously set forth in the Board Final Threshold
Rules and the Regulation M Adjustment Calculation Rule. For these
reasons, the Agencies have determined
[[Page 83320]]
that publishing a notice of proposed rulemaking and providing
opportunity for public comment are unnecessary. Therefore, the
amendments are adopted in final form.
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\11\ 5 U.S.C. 553(b)(B).
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Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) does not apply to a rulemaking
where a general notice of proposed rulemaking is not required.\12\ As
noted previously, the Agencies have determined that it is unnecessary
to publish a general notice of proposed rulemaking for this joint final
rule. Accordingly, the RFA's requirements relating to an initial and
final regulatory flexibility analysis do not apply.
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\12\ 5 U.S.C. 603(a) and 604(a).
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Paperwork Reduction Act
The information collections contained in Regulation Z which
implements TILA are approved by OMB under Control number 3170-0006. The
current approval for this control number expires on October 31, 2025.
In accordance with the Paperwork Reduction Act of 1995,\13\ the
Agencies reviewed this final rule. The Agencies have determined that
this rule does not create any new information collections or
substantially revise any existing collections.
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\13\ 44 U.S.C. 3506; 5 CFR part 1320.
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Bureau Congressional Review Act Statement
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Bureau will submit a report containing this rule and other required
information to the U.S. Senate, the U.S. House of Representatives, and
the Comptroller General of the United States prior to the rule taking
effect. The Office of Information and Regulatory Affairs has designated
this rule as not a ``major rule'' as defined by 5 U.S.C. 804(2).
List of Subjects
12 CFR Part 213
Advertising, Consumer leasing, Consumer protection, Federal Reserve
System, Reporting and recordkeeping requirements.
12 CFR Part 1013
Administrative practice and procedure, Advertising, Consumer
protection, Reporting and recordkeeping requirements, Truth in lending.
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
Authority and Issuance
For the reasons set forth in the preamble, the Board amends
Regulation M, 12 CFR part 213, as set forth below:
PART 213--CONSUMER LEASING (REGULATION M)
0
1. The authority citation for part 213 continues to read as follows:
Authority: 15 U.S.C. 1604 and 1667f; Pub. L. 111-203 section
1100E, 124 Stat. 1376.
0
2. In Supplement I to Part 213, under Section 213.2--Definitions,
revise 2(e) Consumer Lease, as follows:
Supplement I to Part 213--Official Staff Interpretations
* * * * *
Section 213.2--Definitions
* * * * *
2(e) Consumer Lease.
1. Primary purposes. A lessor must determine in each case if the
leased property will be used primarily for personal, family, or
household purposes. If a question exists as to the primary purpose for
a lease, the fact that a lessor gives disclosures is not controlling on
the question of whether the transaction is covered. The primary purpose
of a lease is determined before or at consummation and a lessor need
not provide Regulation M disclosures where there is a subsequent change
in the primary use.
2. Period of time. To be a consumer lease, the initial term of the
lease must be more than four months. Thus, a lease of personal property
for four months, three months or on a month-to-month or week-to-week
basis (even though the lease actually extends beyond four months) is
not a consumer lease and is not subject to the disclosure requirements
of the regulation. However, a lease that imposes a penalty for not
continuing the lease beyond four months is considered to have a term of
more than four months. To illustrate:
i. A three-month lease extended on a month-to-month basis and
terminated after one year is not subject to the regulation.
ii. A month-to-month lease with a penalty, such as the forfeiture
of a security deposit for terminating before one year, is subject to
the regulation.
3. Total contractual obligation. The total contractual obligation
is not necessarily the same as the total of payments disclosed under
Sec. 213.4(e). The total contractual obligation includes nonrefundable
amounts a lessee is contractually obligated to pay to the lessor, but
excludes items such as:
i. Residual value amounts or purchase-option prices;
ii. Amounts collected by the lessor but paid to a third party, such
as taxes, licenses, and registration fees.
4. Credit sale. The regulation does not cover a lease that meets
the definition of a credit sale in Regulation Z, 12 CFR 226.2(a)(16),
which is defined, in part, as a bailment or lease (unless terminable
without penalty at any time by the consumer) under which the consumer:
i. Agrees to pay as compensation for use a sum substantially
equivalent to, or in excess of, the total value of the property and
services involved; and
ii. Will become (or has the option to become), for no additional
consideration or for nominal consideration, the owner of the property
upon compliance with the agreement.
5. Agricultural purpose. Agricultural purpose means a purpose
related to the production, harvest, exhibition, marketing,
transportation, processing, or manufacture of agricultural products by
a natural person who cultivates, plants, propagates, or nurtures those
agricultural products, including but not limited to the acquisition of
personal property and services used primarily in farming. Agricultural
products include horticultural, viticultural, and dairy products,
livestock, wildlife, poultry, bees, forest products, fish and
shellfish, and any products thereof, including processed and
manufactured products, and any and all products raised or produced on
farms and any processed or manufactured products thereof.
6. Organization or other entity. A consumer lease does not include
a lease made to an organization such as a corporation or a government
agency or instrumentality. Such a lease is not covered by the
regulation even if the leased property is used (by an employee, for
example) primarily for personal, family or household purposes, or is
guaranteed by or subsequently assigned to a natural person.
7. Leases of personal property incidental to a service. The
following leases of personal property are deemed incidental to a
service and thus are not subject to the regulation:
i. Home entertainment systems requiring the consumer to lease
equipment that enables a television to receive the transmitted
programming.
ii. Security alarm systems requiring the installation of leased
equipment intended to monitor unlawful entries into a home and in some
cases to provide fire protection.
iii. Propane gas service where the consumer must lease a propane
tank to receive the service.
8. Safe deposit boxes. The lease of a safe deposit box is not a
consumer lease under Sec. 213.2(e).
9. Threshold amount. A consumer lease is exempt from the
requirements of this part if the total contractual obligation exceeds
the threshold amount in effect at the time of consummation.
[[Page 83321]]
The threshold amount in effect during a particular time period is the
amount stated in comment 2(e)-11 for that period. The threshold amount
is adjusted effective January 1 of each year by any annual percentage
increase in the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W) that was in effect on the preceding June 1.
Comment 2(e)-11 will be amended to provide the threshold amount for the
upcoming year after the annual percentage change in the CPI-W that was
in effect on June 1 becomes available. Any increase in the threshold
amount will be rounded to the nearest $100 increment. For example, if
the annual percentage increase in the CPI-W would result in a $950
increase in the threshold amount, the threshold amount will be
increased by $1,000. However, if the annual percentage increase in the
CPI-W would result in a $949 increase in the threshold amount, the
threshold amount will be increased by $900. If a consumer lease is
exempt from the requirements of this part because the total contractual
obligation exceeds the threshold amount in effect at the time of
consummation, the lease remains exempt regardless of a subsequent
increase in the threshold amount.
10. No increase in the CPI-W. If the CPI-W in effect on June 1 does
not increase from the CPI-W in effect on June 1 of the previous year,
the threshold amount effective the following January 1 through December
31 will not change from the previous year. When this occurs, for the
years that follow, the threshold is calculated based on the annual
percentage change in the CPI-W applied to the dollar amount that would
have resulted, after rounding, if decreases and any subsequent
increases in the CPI-W had been taken into account.
i. Net increases. If the resulting amount calculated, after
rounding, is greater than the current threshold, then the threshold
effective January 1 the following year will increase accordingly.
ii. Net decreases. If the resulting amount calculated, after
rounding, is equal to or less than the current threshold, then the
threshold effective January 1 the following year will not change, but
future increases will be calculated based on the amount that would have
resulted.
11. Threshold. For purposes of Sec. 213.2(e)(1), the threshold
amount in effect during a particular period is the amount stated below
for that period.
i. Prior to July 21, 2011, the threshold amount is $25,000.
ii. From July 21, 2011, through December 31, 2011, the threshold
amount is $50,000.
iii. From January 1, 2012, through December 31, 2012, the threshold
amount is $51,800.
iv. From January 1, 2013, through December 31, 2013, the threshold
amount is $53,000.
v. From January 1, 2014, through December 31, 2014, the threshold
amount is $53,500.
vi. From January 1, 2015, through December 31, 2015, the threshold
amount is $54,600.
vii. From January 1, 2016, through December 31, 2016, the threshold
amount is $54,600.
viii. From January 1, 2017, through December 31, 2017, the
threshold amount is $54,600.
ix. From January 1, 2018, through December 31, 2018, the threshold
amount is $55,800.
x. From January 1, 2019, through December 31, 2019, the threshold
amount is $57,200.
xi. From January 1, 2020, through December 31, 2020, the threshold
amount is $58,300.
xii. From January 1, 2021, through December 31, 2021, the threshold
amount is $58,300.
xiii. From January 1, 2022, through December 31, 2022, the
threshold amount is $61,000.
xiv. From January 1, 2023, through December 31, 2023, the threshold
amount is $66,400.
xv. From January 1, 2024, through December 31, 2024, the threshold
amount is $69,500.
* * * * *
CONSUMER FINANCIAL PROTECTION BUREAU
Authority and Issuance
For the reasons set forth in the preamble, the Bureau amends
Regulation M, 12 CFR part 1013, as set forth below:
PART 1013--CONSUMER LEASING (REGULATION M)
0
3. The authority citation for part 1013 continues to read as follows:
Authority: 15 U.S.C. 1604 and 1667f; Pub. L. 111-203 sec.
1100E, 124 Stat. 1376.
0
4. In Supplement I to part 1013, under Section 1013.2--Definitions,
revise 2(e)--Consumer Lease to read as follows:
Supplement I to Part 1013--Official Interpretations
* * * * *
Section 1013.2--Definitions
* * * * *
2(e) Consumer Lease
1. Primary purposes. A lessor must determine in each case if the
leased property will be used primarily for personal, family, or
household purposes. If a question exists as to the primary purpose for
a lease, the fact that a lessor gives disclosures is not controlling on
the question of whether the transaction is covered. The primary purpose
of a lease is determined before or at consummation and a lessor need
not provide Regulation M disclosures where there is a subsequent change
in the primary use.
2. Period of time. To be a consumer lease, the initial term of the
lease must be more than four months. Thus, a lease of personal property
for four months, three months or on a month-to-month or week-to-week
basis (even though the lease actually extends beyond four months) is
not a consumer lease and is not subject to the disclosure requirements
of the regulation. However, a lease that imposes a penalty for not
continuing the lease beyond four months is considered to have a term of
more than four months. To illustrate:
i. A three-month lease extended on a month-to-month basis and
terminated after one year is not subject to the regulation.
ii. A month-to-month lease with a penalty, such as the forfeiture
of a security deposit for terminating before one year, is subject to
the regulation.
3. Total contractual obligation. The total contractual obligation
is not necessarily the same as the total of payments disclosed under
Sec. 1013.4(e). The total contractual obligation includes
nonrefundable amounts a lessee is contractually obligated to pay to the
lessor, but excludes items such as:
i. Residual value amounts or purchase-option prices;
ii. Amounts collected by the lessor but paid to a third party, such
as taxes, licenses, and registration fees.
4. Credit sale. The regulation does not cover a lease that meets
the definition of a credit sale in Regulation Z, 12 CFR 226.2(a)(16),
which is defined, in part, as a bailment or lease (unless terminable
without penalty at any time by the consumer) under which the consumer:
i. Agrees to pay as compensation for use a sum substantially
equivalent to, or in excess of, the total value of the property and
services involved; and
ii. Will become (or has the option to become), for no additional
consideration or for nominal consideration, the owner of the property
upon compliance with the agreement.
[[Page 83322]]
5. Agricultural purpose. Agricultural purpose means a purpose
related to the production, harvest, exhibition, marketing,
transportation, processing, or manufacture of agricultural products by
a natural person who cultivates, plants, propagates, or nurtures those
agricultural products, including but not limited to the acquisition of
personal property and services used primarily in farming. Agricultural
products include horticultural, viticultural, and dairy products,
livestock, wildlife, poultry, bees, forest products, fish and
shellfish, and any products thereof, including processed and
manufactured products, and any and all products raised or produced on
farms and any processed or manufactured products thereof.
6. Organization or other entity. A consumer lease does not include
a lease made to an organization such as a corporation or a government
agency or instrumentality. Such a lease is not covered by the
regulation even if the leased property is used (by an employee, for
example) primarily for personal, family or household purposes, or is
guaranteed by or subsequently assigned to a natural person.
7. Leases of personal property incidental to a service. The
following leases of personal property are deemed incidental to a
service and thus are not subject to the regulation:
i. Home entertainment systems requiring the consumer to lease
equipment that enables a television to receive the transmitted
programming.
ii. Security alarm systems requiring the installation of leased
equipment intended to monitor unlawful entries into a home and in some
cases to provide fire protection.
iii. Propane gas service where the consumer must lease a propane
tank to receive the service.
8. Safe deposit boxes. The lease of a safe deposit box is not a
consumer lease under Sec. 1013.2(e).
9. Threshold amount. A consumer lease is exempt from the
requirements of this part if the total contractual obligation exceeds
the threshold amount in effect at the time of consummation. The
threshold amount in effect during a particular time period is the
amount stated in comment 2(e)-11 for that period. The threshold amount
is adjusted effective January 1 of each year by any annual percentage
increase in the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W) that was in effect on the preceding June 1.
Comment 2(e)-11 will be amended to provide the threshold amount for the
upcoming year after the annual percentage change in the CPI-W that was
in effect on June 1 becomes available. Any increase in the threshold
amount will be rounded to the nearest $100 increment. For example, if
the annual percentage increase in the CPI-W would result in a $950
increase in the threshold amount, the threshold amount will be
increased by $1,000. However, if the annual percentage increase in the
CPI-W would result in a $949 increase in the threshold amount, the
threshold amount will be increased by $900. If a consumer lease is
exempt from the requirements of this part because the total contractual
obligation exceeds the threshold amount in effect at the time of
consummation, the lease remains exempt regardless of a subsequent
increase in the threshold amount.
10. No increase in the CPI-W. If the CPI-W in effect on June 1 does
not increase from the CPI-W in effect on June 1 of the previous year,
the threshold amount effective the following January 1 through December
31 will not change from the previous year. When this occurs, for the
years that follow, the threshold is calculated based on the annual
percentage change in the CPI-W applied to the dollar amount that would
have resulted, after rounding, if decreases and any subsequent
increases in the CPI-W had been taken into account.
i. Net increases. If the resulting amount calculated, after
rounding, is greater than the current threshold, then the threshold
effective January 1 the following year will increase accordingly.
ii. Net decreases. If the resulting amount calculated, after
rounding, is equal to or less than the current threshold, then the
threshold effective January 1 the following year will not change, but
future increases will be calculated based on the amount that would have
resulted.
11. Threshold. For purposes of Sec. 1013.2(e)(1), the threshold
amount in effect during a particular period is the amount stated below
for that period.
i. Prior to July 21, 2011, the threshold amount is $25,000.
ii. From July 21, 2011, through December 31, 2011, the threshold
amount is $50,000.
iii. From January 1, 2012, through December 31, 2012, the threshold
amount is $51,800.
iv. From January 1, 2013, through December 31, 2013, the threshold
amount is $53,000.
v. From January 1, 2014, through December 31, 2014, the threshold
amount is $53,500.
vi. From January 1, 2015, through December 31, 2015, the threshold
amount is $54,600.
vii. From January 1, 2016, through December 31, 2016, the threshold
amount is $54,600.
viii. From January 1, 2017, through December 31, 2017, the
threshold amount is $54,600.
ix. From January 1, 2018, through December 31, 2018, the threshold
amount is $55,800.
x. From January 1, 2019, through December 31, 2019, the threshold
amount is $57,200.
xi. From January 1, 2020, through December 31, 2020, the threshold
amount is $58,300.
xii. From January 1, 2021, through December 31, 2021, the threshold
amount is $58,300.
xiii. From January 1, 2022, through December 31, 2022, the
threshold amount is $61,000.
xiv. From January 1, 2023, through December 31, 2023, the threshold
amount is $66,400.
xv. From January 1, 2024, through December 31, 2024, the threshold
amount is $69,500.
* * * * *
By order of the Board of Governors of the Federal Reserve
System, acting through the Secretary of the Board under delegated
authority.
Michele Taylor Fennell,
Deputy Associate Secretary of the Board.
Brian Shearer,
Senior Advisor, Consumer Financial Protection Bureau.
[FR Doc. 2023-25049 Filed 11-28-23; 8:45 am]
BILLING CODE 4810-AM-P; 6210-01-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.