[Federal Register Volume 62, Number 3 (Monday, January 6, 1997)]
[Proposed Rules]
[Pages 694-695]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-33397]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[REG-242996-96]
RIN 1545-AU45


Inflation-Indexed Debt Instruments

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking by cross-reference to temporary 
regulations and notice of public hearing.

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SUMMARY: In the Rules and Regulations section of this issue of the 
Federal Register, the IRS is issuing temporary regulations relating to 
the federal income tax treatment of inflation-indexed debt instruments, 
including

[[Page 695]]

Treasury Inflation-Indexed Securities. The text of the temporary 
regulations also serves as the text of the proposed regulations. This 
document also provides notice of a public hearing on the proposed 
regulations.

DATES: Comments must be received by April 7, 1997. Requests to appear 
and outlines of topics to be discussed at the public hearing scheduled 
for April 30, 1997, at 10 a.m. must be received by April 9, 1997.

ADDRESSES: Send submissions to: CC:DOM:CORP:R (REG-242996-96), room 
5226, Internal Revenue Service, POB 7604, Ben Franklin Station, 
Washington, DC 20044. Submissions may be hand delivered between the 
hours of 8 a.m. and 5 p.m. to: CC:DOM:CORP:R (REG-242996-96), Courier's 
Desk, Internal Revenue Service, 1111 Constitution Avenue NW, 
Washington, DC. Alternatively, taxpayers may submit comments 
electronically via the internet by selecting the ``Tax Regs'' option of 
the IRS Home Page or by submitting comments directly to the IRS 
internet site at http://www.irs.ustreas.gov/prod/tax__regs/
comments.html. A public hearing will be held in the NYU Classroom, room 
2615, Internal Revenue Building, 1111 Constitution Avenue NW, 
Washington, DC.

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, William E. 
Blanchard, (202) 622-3950, or Jeffrey W. Maddrey, (202) 622-3940; 
concerning submissions and the hearing, Mike Slaughter, (202) 622-7190 
(not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Background

    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 1275 and 1286 of the Internal Revenue 
Code. The temporary regulations provide rules relating to inflation-
indexed debt instruments, including Treasury Inflation-Indexed 
Securities.
    The text of the temporary regulations also serves as the text of 
the 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) does not apply to these regulations and, because the 
regulations do not impose a collection of information on small 
entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not 
apply. 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 Public Hearing

    Before these proposed regulations are adopted as final regulations, 
consideration will be given to any comments that are submitted timely 
(in the manner described in the ADDRESSES portion of this preamble) to 
the IRS. All comments will be available for public inspection and 
copying.
    A public hearing has been scheduled for April 30, 1997, at 10 a.m. 
in the NYU Classroom, room 2615, Internal Revenue Building, 1111 
Constitution Avenue NW, Washington, DC. Because of access restrictions, 
visitors will not be admitted beyond the building lobby more than 15 
minutes before the hearing starts.
    The rules of 26 CFR 601.601(a)(3) apply to the hearing.
    Persons who wish to present oral comments at the hearing must 
submit comments by April 7, 1997, and submit an outline of the topics 
to be discussed and the time to be devoted to each topic by April 9, 
1997.
    A period of 10 minutes will be allotted to each person for making 
comments.
    An agenda showing the scheduling of the speakers will be prepared 
after the deadline for receiving outlines has passed. Copies of the 
agenda will be available free of charge at the hearing.

Drafting Information

    The principal author of these regulations is William E. Blanchard, 
Office of Assistant Chief Counsel (Financial Institutions and 
Products). 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 
two entries in numerical order to read as follows:

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

    Section 1.1275-7 also issued under 26 U.S.C. 1275(d). * * *
    Section 1.1286-2 also issued under 26 U.S.C. 1286(f). * * *
    Par. 2. Section 1.1275-7 is added to read as follows:


Sec. 1.1275-7  Inflation-indexed debt instruments.

    [The text of this proposed section is the same as the text of 
Sec. 1.1275-7T published elsewhere in this issue of the Federal 
Register.]
    Par. 3. Section 1.1286-2 is added to read as follows:


Sec. 1.1286-2  Inflation-indexed debt instruments.

    [The text of this proposed section is the same as the text of 
Sec. 1.1286-2T published elsewhere in this issue of the Federal 
Register.]
Margaret Milner Richardson,
Commissioner of Internal Revenue.
[FR Doc. 96-33397 Filed 12-31-96; 12:57 pm]
BILLING CODE 4830-01-U