[Federal Register Volume 60, Number 184 (Friday, September 22, 1995)]
[Proposed Rules]
[Pages 49236-49237]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-23264]



=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[EE-24-93]
RIN 1545-AT75


Notice, Consent, and Election Requirements Under Sections 
411(a)(11) and 417

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking by cross-reference to temporary 
regulations.

-----------------------------------------------------------------------

SUMMARY: In the Rules and Regulations section of this issue of the 
Federal Register, the IRS is issuing temporary regulations that provide 
guidance concerning the notice and consent requirements under section 
411(a)(11) and the notice and election requirements of section 417. The 
text of those temporary regulations also serves as the text of these 
proposed regulations.

DATES: Written comments must be received by December 20, 1995.

ADDRESSES: Send submissions to CC:DOM:CORP:T:R (EE-24-93), room 5228, 
Internal Revenue Service, POB 7604, Ben Franklin Station, Washington, 
DC 20044. In the alternative, submissions may be hand delivered between 
the hours of 8 a.m. and 5 p.m. to CC:DOM:CORP:T:R (EE-24-93), Courier's 
Desk, Internal Revenue Service, 1111 Constitution Avenue NW., 
Washington, DC.

FOR FURTHER INFORMATION CONTACT: Thomas Foley, (202) 622-6050 (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 
(OMB) for review in accordance with the Paperwork Reduction Act of 1995 
(44 U.S.C. 3507).
    Comments on the collection of information should be sent to the 
Office of Management and Budget, Attn: Desk Officer for the Department 
of 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. To ensure that 
comments on the collection of information may be given full 
consideration during the review by OMB, these comments should be 
received by December 20, 1995.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless the collection of 
information displays a valid control number.
    The collection of information is in the provisions of 
Secs. 1.411(a)-11(c)(2)(iii) and 1.417(e)-1(b)(3)(ii) that require the 
plan administrator to inform a participant that the participant has a 
right to at least 30 days to consider distribution options. Existing 
regulations implement the mandate of section 417(a)(3) that a qualified 
plan provide a written explanation of distribution options to each 
participant. Under existing regulations, a distribution cannot be made 
until 30 days after the explanation is provided. The provisions of this 
notice of proposed rulemaking give plans the flexibility to make a 
distribution within 30 days provided the participant is clearly 
informed of the right to at least 30 days for consideration of the 
distribution options. The IRS requires this information to be provided 
to participants to assure they have adequate time to evaluate their 
distribution options.
    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.
    The collection of information under this notice of proposed 
rulemaking can be satisfied by the addition of a statement to the 
explanation already provided by plan administrators to participants 
under existing regulations. Therefore, this collection of information 
results in a minor increase in an existing burden. 

[[Page 49237]]

    Estimated total annual reporting burden: 8333 hours. The estimated 
burden per respondent varies from 0 hours to 2 hours, depending on 
individual circumstances, with an estimated average of .011 hours.
    Estimated number of respondents: 750,000.
    Estimated annual frequency of responses: One time per year.

Background

    Temporary regulations in the Rules and Regulations portion of this 
issue of the Federal Register amend the Income Tax Regulations (26 CFR 
part 1) relating to section 411(a)(11) and section 417. The temporary 
regulations contain rules relating to the notice, consent, and election 
requirements of those sections.
    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.

Special Analyses

    It has been determined that this notice of proposed rulemaking is 
not a significant regulatory action as defined in EO 12866. Therefore, 
a regulatory assessment is not required. It also has 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 and Requests for a 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) that are submitted timely to the IRS. All 
comments will be available for public inspection and copying.
    A public hearing may be scheduled if requested in writing by a 
person that timely submits written comments. If a public hearing is 
scheduled, notice of the date, time, and place for the hearing will be 
published in the Federal Register.

Drafting Information

    The principal author of these regulations is Marjorie Hoffman, 
Office of the Associate Chief Counsel, (Employee Benefits and Exempt 
Organizations), IRS. However, other personnel from the IRS and 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 continues to read, 
in part, as follows:

    Authority: 26 U.S.C. 7805. * * *

    Par. 2. Section 1.411(a)-11 is amended by:
    1. Revising paragraphs (c)(2) (ii) and (iii).
    2. Adding paragraphs (c)(2) (iv) and (v) and (c)(8).
    The revisions and additions read as follows:


Sec. 1.411(a)-11  Restriction and valuation of distributions.

[The text of proposed paragraphs (c)(2)(ii) through (c)(2)(v) and 
(c)(8) are the same as the text of Sec. 1.411(a)-11T published 
elsewhere in this issue of the Federal Register].
    Par. 3. Section 1.417(e)-1 is amended by:
    1. Revising paragraph (b)(3).
    2. Adding paragraph (b)(4).
    The revision and addition read as follows:


Sec. 1.417(e)-1  Restrictions and valuations of distributions from 
plans subject to sections 401(a)(11) and 417.

[The text of proposed paragraphs (b) (3) and (4) is the same as the 
text of Sec. 1.417(e)-1T published elsewhere in this issue of the 
Federal Register].
Margaret Milner Richardson,
Commissioner of Internal Revenue.
[FR Doc. 95-23264 Filed 9-15-95; 4:00 pm]
BILLING CODE 4830-01-U