[Federal Register Volume 59, Number 130 (Friday, July 8, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-16358]
[[Page Unknown]]
[Federal Register: July 8, 1994]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[IL-21-91]
RIN 1545-AS24
Imposition of Accuracy-Related Penalty
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 is issuing temporary regulations that provide
guidance on the imposition of the accuracy-related penalty under
Internal Revenue Code sections 6662 (e) and (h) for net section 482
transfer price adjustments. The text of those temporary regulations
also serves as the comment document for this notice of proposed
rulemaking.
DATES: Comments and requests to appear at the public hearing scheduled
on September 19, 1994, must be received by August 19, 1994.
ADDRESSES: Send submissions to: CC:DOM:CORP:T:R (IL-21-91), room 5228,
Internal Revenue Service, POB 7604, Ben Franklin Station, Washington,
DC 20044. In the alternative, submissions may be hand delivered to:
CC:DOM:CORP:T:R (IL-21-91), Internal Revenue Service, room 5228, 1111
Constitution Avenue NW., Washington, DC 20224.
FOR FURTHER INFORMATION CONTACT: Thomas L. Ralph at (202) 622-3880 (not
a toll-free number).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information contained in this notice of proposed
rulemaking has been submitted to the Office of Management and Budget
for review in accordance with the Paperwork Reduction Act (44 U.S.C.
3504(h)). 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 PC:FP, Washington, DC
20224.
The collection of information in this notice of proposed rulemaking
is in Secs. 1.6662-6T (d)(2)(iii) and (d)(3)(iii). This information is
required by the IRS to implement section 6662(e)(3)(B) of the Internal
Revenue Code. This information will be used to determine whether the
taxpayer reasonably concluded that the transfer prices charged in
related party transactions were consistent with the arm's length
standard. The likely respondents and recordkeepers are business or
other for-profit institutions and small businesses or organizations.
Estimated total reporting burden: 125 hours. The estimated average
burden per respondent: .25 hour. Estimated number of respondents: 500.
Estimated annual frequency of responses: 1. Estimated total annual
recordkeeping burden: 20,000. The estimated annual burden per
recordkeeper varies from 5 hours to 15 hours, depending on individual
circumstances, with an estimated average of 10 hours. Estimated number
of recordkeepers: 2,000.
Background
The temporary regulations published in the Rules and Regulations
section of this issue of the Federal Register contain amendments to the
Income Tax Regulations under sections 6662 (e) and (h) relating to the
imposition of accuracy-related penalties. The final regulations that
will result from the regulations proposed in this notice would be based
on the text of the temporary regulations and would provide rules
relating to the imposition of accuracy-related penalties under those
sections for net section 482 transfer price adjustments.
The text of those temporary regulations also serves as the text of
these proposed regulations. The preamble to the temporary regulations
explains these proposed regulations.
Special Analysis
It has been determined that this notice of proposed rulemaking is
not a significant regulatory action as defined in Executive Order
12866. It has also been determined that section 553(b) of the
Administrative Procedure Act (5 U.S.C. chapter 5) and the Regulatory
Flexibility Act (5 U.S.C. chapter 6) do not apply to these regulations,
and therefore, a Regulatory Flexibility Analysis is not required.
Pursuant to section 7805(f) of the Internal Revenue Code, this notice
of proposed rulemaking will be submitted to the Chief Counsel for
Advocacy of the Small Business Administration for comment on its impact
on small business.
Comments
Before these proposed regulations are adopted as final regulations,
consideration will be given to any written comments that are timely
submitted (preferably a signed original and eight copies) to the
Internal Revenue Service. All comments will be available for public
inspection and copying. A public hearing has been scheduled on
September 19, 1994, at 10 a.m. in the IRS auditorium.
Drafting Information
The principal author of these proposed regulations is Thomas L.
Ralph of the Office of the Associate Chief Counsel (International),
Internal Revenue Service. However, other personnel from the IRS and the
Treasury Department participated in their development.
List of Subjects in 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 is amended by adding
an entry in numerical order to read as follows:
Authority: 26 U.S.C. 7805 * * *
Sec. 1.6662-6 also issued under 26 U.S.C. 6662. * * *
Par. 2. Section 1.6662-0 is amended by adding entries to the table
to read as follows:
Sec. 1.6662-0 Table of contents.
[The text of the proposed amendments to this section is the same as
the text of the amendments to Sec. 1.6662-0 published elsewhere in this
issue of the Federal Register.]
Par. 3. Section 1.6662-6 is added to read as follows:
Sec. 1.6662-6 Transactions between persons described in section 482
and net section 482 transfer price adjustments.
[The text of this proposed section is the same as the text of
Sec. 1.6662-6T published elsewhere in this issue of the Federal
Register.]
Margaret Milner Richardson,
Commissioner of Internal Revenue.
[FR Doc. 94-16358 Filed 7-5-94; 12:26 pm]
BILLING CODE 4830-01-P