diff --git a/specs/core/0_beacon-chain.md b/specs/core/0_beacon-chain.md
index d32716295..cf9f719ac 100644
--- a/specs/core/0_beacon-chain.md
+++ b/specs/core/0_beacon-chain.md
@@ -1858,9 +1858,11 @@ First, we define some additional helpers:
 * Let `base_reward(state, index) = get_effective_balance(state, index) // base_reward_quotient // 5` for any validator with the given `index`.
 * Let `inactivity_penalty(state, index, epochs_since_finality) = base_reward(state, index) + get_effective_balance(state, index) * epochs_since_finality // INACTIVITY_PENALTY_QUOTIENT // 2` for any validator with the given `index`.
 
+Note: When applying penalties in the following balance recalculations implementers should make sure the `uint64` does not underflow.
+
 ##### Justification and finalization
 
-Note: When applying penalties in the following balance recalculations implementers should make sure the `uint64` does not underflow.
+Note: Rewards and penalties are for participation in the previous epoch, so the "active validator" set is drawn from `get_active_validator_indices(state.validator_registry, previous_epoch)`.
 
 * Let `epochs_since_finality = next_epoch - state.finalized_epoch`.
 
@@ -1883,7 +1885,7 @@ Case 2: `epochs_since_finality > 4`:
 * Any [active validator](#dfn-active-validator) `index` not in `previous_epoch_attester_indices`, loses `inactivity_penalty(state, index, epochs_since_finality)`.
 * Any [active validator](#dfn-active-validator) `index` not in `previous_epoch_boundary_attester_indices`, loses `inactivity_penalty(state, index, epochs_since_finality)`.
 * Any [active validator](#dfn-active-validator) `index` not in `previous_epoch_head_attester_indices`, loses `base_reward(state, index)`.
-* Any [active_validator](#dfn-active-validator) `index` with `validator.penalized_epoch <= current_epoch`, loses `2 * inactivity_penalty(state, index, epochs_since_finality) + base_reward(state, index)`.
+* Any [active validator](#dfn-active-validator) `index` with `validator.penalized_epoch <= current_epoch`, loses `2 * inactivity_penalty(state, index, epochs_since_finality) + base_reward(state, index)`.
 * Any [validator](#dfn-validator) `index` in `previous_epoch_attester_indices` loses `base_reward(state, index) - base_reward(state, index) * MIN_ATTESTATION_INCLUSION_DELAY // inclusion_distance(state, index)`
 
 ##### Attestation inclusion