[Federal Register Volume 73, Number 175 (Tuesday, September 9, 2008)]
[Proposed Rules]
[Pages 52218-52220]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-20556]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 73, No. 175 / Tuesday, September 9, 2008 /
Proposed Rules
[[Page 52218]]
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[REG-142333-07]
RIN 1545-BH28
Implementation of Form 990
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Notice of proposed rulemaking by cross-reference to temporary
regulations.
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SUMMARY: In the Rules and Regulations section of this issue of the
Federal Register, the IRS and the Treasury Department are issuing
temporary regulations necessary to implement the redesigned Form 990,
``Return of Organization Exempt From Income Tax.'' The temporary
regulations make revisions to the regulations under section 6033 and
section 6043 to allow for new threshold amounts for reporting
compensation, to require that compensation be reported on a calendar
year basis, and to modify the scope of organizations subject to
information reporting requirements upon a substantial contraction. The
temporary regulations also eliminate the advance ruling process for new
organizations, change the public support computation period for
organizations described in sections 170(b)(1)(A)(vi) and 509(a)(1) and
in section 509(a)(2) to five years, consistent with the revised Form
990, and clarify that support must be reported using the organization's
overall method of accounting. All tax exempt organizations required
under section 6033 of the Internal Revenue Code (Code) to file annual
information returns are affected by the temporary regulations. The text
of the temporary regulations also serves as the text of these proposed
regulations.
DATES: Written or electronic comments and requests for a public hearing
must be received by November 10, 2008.
ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-142333-07), Room
5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station,
Washington, DC 20044. Submissions may be hand-delivered Monday through
Friday between the hours of 8 a.m. and 4 p.m. to: CC:PA:LPD:PR (REG-
142333-07), Courier's Desk, Internal Revenue Service, 1111 Constitution
Avenue, NW., Washington, DC, or sent electronically, via the Federal
eRulemaking Portal at http://www.regulations.gov (IRS REG-142333-07).
FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations,
Terri Harris, at (202) 622-6070; concerning submissions of comments or
requests for a hearing, Oluwafunmilayo Taylor, at (202) 622-3401 (not
toll-free numbers).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information contained in this notice of proposed
rulemaking has been reviewed and approved by the Office of Management
and Budget in accordance with the Paperwork Reduction Act of 1995 (44
U.S.C. 3507(d)) under control number 1545-2117. Comments on the
collection of information should be sent to the Office of Management
and Budget, Attn: Desk Officer for the Department of the Treasury,
Office of Information and Regulatory Affairs, Washington, DC 20503,
with copies to the Internal Revenue Service, Attn: IRS Reports
Clearance Officer, SE:W:CAR: MP:T:T:SP, Washington, DC 20224. Comments
on the collection of information should be received by November 10,
2008. Comments are specifically requested concerning:
Whether the proposed collection of information is necessary for the
proper performance of the functions of the Internal Revenue Service,
including whether the information will have practical utility;
The accuracy of the estimated burden associated with the proposed
collection of information;
How the quality, utility and clarity of the information to be
collected may be enhanced;
How the burden of complying with the proposed collection of
information may be minimized, including through the application of
automated collection techniques or other forms of information
technology; and
Estimates of capital or start-up costs and costs of operation,
maintenance and purchase of service to provide information.
The collection of information in this proposed regulation is in
Sec. 1.6033-2T. The information collected under Sec. 1.6033-2T
relates to compensation reporting by tax exempt organizations. The
information that is required to be collected for purposes of Sec.
1.6033-2T is required to be submitted on Form 990, ``Return of
Organization Exempt From Income Tax.'' The estimated number of
recordkeepers that will submit Form 990 is approximately 105,000.
Estimated total annual reporting burden: One hour.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a valid
control number assigned by the Office of Management and Budget.
Books or records relating to a collection of information must be
retained as long as their contents may become material in the
administration of any internal revenue law. Generally, tax returns and
tax return information are confidential, as required by 26 U.S.C. 6103.
Background and Explanation of Provision
Temporary regulations in the Rules and Regulations section of this
issue of the Federal Register amend the Income Tax Regulations (26 CFR
part 1) relating to sections 170(b), 507, 509(a), 6033, and 6043. The
amendments to Sec. Sec. 1.170A-9, 1.507-2 and 1.509(a)-3 eliminate the
advance ruling process, clarify that support must be reported using the
organization's overall method of accounting, eliminate the exception
for material changes in sources of support, and change the public
support computation period for organizations described in sections
170(b)(1)(A)(vi) and 509(a)(1) and in section 509(a)(2) to five years,
consistent with the revised Schedule A to the redesigned Form 990,
``Return of Organization Exempt From Income Tax.'' The amendments to
Sec. Sec. 1.6033-2(a)(2)(ii)(g) and (h) allow for new threshold
amounts for reporting compensation and require that organizations use a
calendar year basis or a basis that is prescribed by publication, form
or instruction when
[[Page 52219]]
reporting listed officer, director, trustee, key employee and
independent contractor compensation. The amendments to Sec. Sec.
1.6043-3(b)(8) and (d) expand the scope of organizations subject to
information reporting requirements upon a substantial contraction. The
text of those temporary regulations also serves as the text of these
proposed regulations. The preamble to the temporary regulations
explains the temporary regulations and these proposed regulations.
Special Analyses
It has been determined that this notice of proposed rulemaking is
not a significant regulatory action as defined in Executive Order
12866. Therefore, a regulatory assessment is not required. It has also
been determined that section 553(b) of the Administrative Procedure Act
(5 U.S.C. chapter 5) does not apply. It is hereby certified that the
collection of information in this regulation will not have a
significant economic impact on a substantial number of small entities.
This certification is based on the fact that burden on tax-exempt
entities will be reduced by (1) eliminating the separate advance ruling
process and the additional process for subsequently seeking a
definitive ruling, (2) clarifying rules regarding the method of
accounting and period for reporting certain items, and (3) providing
discretion for the IRS to narrow or clarify circumstances under which
reporting is required. Accordingly, a Regulatory Flexibility Analysis
under the Regulatory Flexibility Act (5 U.S.C. chapter 6) is not
required. Pursuant to section 7805(f) of the Code, these regulations
have been submitted to the Chief Counsel for Advocacy of the Small
Business Administration for comment on their impact on small business.
Comments and Requests for Public Hearing
Before these proposed regulations are adopted as final regulations,
consideration will be given to any written comments (a signed original
and eight (8) copies) or electronic comments that are submitted timely
to the IRS. Comments are requested on all aspects of the proposed
regulations. The IRS and the Treasury Department request comments on
the clarity of the proposed rules and how they can be made easier to
understand. All comments will be available for public inspection and
copying.
A public hearing will be scheduled if requested in writing by any
person that timely submits written comments. If a public hearing is
scheduled, notice of the date, time, and place for the public hearing
will be published in the Federal Register.
Drafting Information
The principal author of this regulation is Terri Harris of the
Office of Division Counsel/Associate Chief Counsel (Tax Exempt and
Government Entities). However, other personnel from the IRS and the
Treasury Department participated in their development.
List of Subjects for 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Proposed Amendments to the Regulations
Accordingly, 26 CFR part 1 is proposed to be amended as follows:
PART 1--INCOME TAXES
Paragraph 1. The authority citation for part 1 continues to read in
part as follows:
Authority: 26 U.S.C. 7805 * * *
Par. 2. Section 1.170A-9 is amended by revising paragraphs (f) and
(k) to read as follows:
Sec. 1.170A-9 Definition of section 170(b)(1)(A) organization.
* * * * *
(f) [The text of this proposed amendment to Sec. 1.170A-9(f) is
the same as the text of Sec. 1.170A-9T(f) published elsewhere in this
issue of the Federal Register.]
* * * * *
(k) [The text of this proposed amendment to Sec. 1.170A-9(k) is
the same as the text of Sec. 1.170A-9T(k)(1) and (k)(2) published
elsewhere in this issue of the Federal Register.]
Par. 3. Section 1.507-2 is revised to read as follows:
Sec. 1.507-2 Special rules; transfer to, or operation as, public
charity.
[The text of this proposed amendment to Sec. 1.507-2 is the same
as the text of Sec. 1.507-2T(a) through (f)(2) published elsewhere in
this issue of the Federal Register.]
Par. 4. Section 1.509(a)-3 is amended by revising paragraphs
(a)(2), (a)(3)(i), (c), (d), (e), (k), and (n) and adding paragraph (o)
to read as follows:
Sec. 1.509(a)-3 Broadly, publicly supported organizations.
(a) * * *
(2) [The text of this proposed amendment to Sec. 1.509(a)-3(a)(2)
is the same as the text of Sec. 1.509(a)-3T(a)(2) published elsewhere
in this issue of the Federal Register.]
(3) * * *
(i) [The text of this proposed amendment to Sec. 1.509(a)-
3(a)(3)(i) is the same as the text of Sec. 1.509(a)-3T(a)(3)(i)
published elsewhere in this issue of the Federal Register.]
* * * * *
(c) [The text of this proposed amendment to Sec. 1.509(a)-3(c) is
the same as the text of Sec. 1.509(a)-3T(c) published elsewhere in
this issue of the Federal Register.]
(d) [The text of this proposed amendment to Sec. 1.509(a)-3(d) is
the same as the text of Sec. 1.509(a)-3T(d) published elsewhere in
this issue of the Federal Register.]
(e) [The text of this proposed amendment to Sec. 1.509(a)-3(e) is
the same as the text of Sec. 1.509(a)-3T(e) published elsewhere in
this issue of the Federal Register.]
* * * * *
(k) [The text of this proposed amendment to Sec. 1.509(a)-3(k) is
the same as the text of Sec. 1.509(a)-3T(k) published elsewhere in
this issue of the Federal Register.]
* * * * *
(n) [The text of this proposed amendment to Sec. 1.509(a)-3(n) is
the same as the text of Sec. 1.509(a)-3T(n) published elsewhere in
this issue of the Federal Register.]
(o) [The text of this proposed Sec. 1.509(a)-3(o) is the same as
the text of Sec. 1.509(a)-3T(o)(1) and (o)(2) published elsewhere in
this issue of the Federal Register.]
Par. 5. Section 1.6033-2 is amended by revising paragraphs
(a)(2)(ii)(g), (a)(2)(ii)(h) and (k) to read as follows:
Sec. 1.6033-2 Returns by exempt organizations (taxable years
beginning after December 31, 1969) and returns by certain nonexempt
organizations (taxable years beginning after December 31, 1980).
(a) * * *
(2) * * *
(ii) * * *
(g) [The text of this proposed amendment to Sec. 1.6033-
2(a)(2)(ii)(g) is the same as the text of Sec. 1.6033-2T(a)(2)(ii)(g)
published elsewhere in this issue of the Federal Register.]
(h) [The text of this proposed amendment to Sec. 1.6033-
2(a)(2)(ii)(h) is the same as the text of Sec. 1.6033-2T(a)(2)(ii)(h)
published elsewhere in this issue of the Federal Register.]
* * * * *
(k) [The text of this proposed amendment to Sec. 1.6033-2(k) is
the same as the text of Sec. 1.6033-2T(k)(1) and (k)(2) published
elsewhere in this issue of the Federal Register.]
Par. 6. Section 1.6043-3 is amended by revising paragraphs (b)(8)
and (d) and adding paragraph (e) to read as follows:
[[Page 52220]]
Sec. 1.6043-3 Returns regarding liquidation, dissolution,
termination, or substantial contraction of organizations exempt from
taxation under section 501(a).
* * * * *
(b) * * *
(8) [The text of this proposed amendment to Sec. 1.6043-3(b)(8) is
the same as the text of Sec. 1.6043-3T(b)(8) published elsewhere in
this issue of the Federal Register.]
* * * * *
(d) [The text of this proposed amendment to Sec. 1.6043-3(d) is
the same as the text of Sec. 1.6043-3T(d) published elsewhere in this
issue of the Federal Register.]
(e) [The text of this proposed amendment to Sec. 1.6043-3(e) is
the same as the text of Sec. 1.6043-3T(e)(1) and (e)(2) published
elsewhere in this issue of the Federal Register.]
Linda E. Stiff,
Deputy Commissioner for Services and Enforcement.
[FR Doc. E8-20556 Filed 9-8-08; 8:45 am]
BILLING CODE 4830-01-P