[Federal Register Volume 70, Number 101 (Thursday, May 26, 2005)]
[Proposed Rules]
[Pages 30380-30381]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-10265]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[REG-106736-00]
RIN 1545-BE67


Assumption of Liabilities

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 final and temporary regulations 
relating to the assumption of liabilities under section 752 of the 
Internal Revenue Code (Code). Those temporary regulations contain rules 
related to the assumption of certain liabilities under section 358(h). 
The text of those 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 August 24, 2005.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-106736-00), room 
5203, Internal Revenue Service, PO 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-
106736-00), Courier's Desk, Internal Revenue Service, 1111 Constitution 
Avenue, NW., Washington, DC, or sent electronically, via the IRS 
Internet site at http://www.irs.gov/regs or via the Federal eRulemaking 
Portal at http://www.regulations.gov (IRS-REG-106736-00).

FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, 
Doug Bates, at (202) 622-7550; concerning submissions of comments and/
or requests for a public hearing, Sonya Cruse, (202) 622-7180 (not toll 
free numbers).

SUPPLEMENTARY INFORMATION:

Explanation of Provisions

    Temporary regulations in the Rules and Regulations section of this 
issue of the Federal Register amend 26 CFR part 1 relating to section 
358(h)(1). The temporary regulations make unavailable the exception to 
section 358(h)(1) that is set forth in section 358(h)(2)(B) (which 
applies where substantially all of the assets with which the liability 
is associated are transferred to the person assuming the liability as 
part of the exchange). The text of those temporary regulations also 
serves as the text of these proposed regulations. The preamble to the 
temporary regulations explains the amendments.

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 is hereby 
certified that these regulations will not have a significant economic 
impact on a substantial number of small entities. This certification is 
based upon the fact that the only impact of the regulations is to 
require taxpayers to calculate the basis of stock received in certain 
transactions more accurately. Therefore, 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, this notice of 
proposed rulemaking will be submitted to the Chief Counsel for Advocacy 
of the Small Business Administration for comment on its impact.

Comments and Requests for a Public Hearing

    Before these regulations are adopted as final regulations, 
consideration will be given to any written comments (a signed original 
with 8 copies) or electronic comments that are submitted timely to the 
IRS. All comments will be made available for pubic inspection and 
copying. A public hearing may be scheduled. 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 these regulations is Douglas Bates, Office 
of the Associate Chief Counsel (Corporate), 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.

[[Page 30381]]

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, in part, as follows:

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

    Sec.  1.358-5 also issued under 26 U.S.C. 358(h)(2). * * *

    Par. 2. Section 1.358-5 is added to read as follows:


Sec.  1.358-5  Special rules for assumption of liabilities.

[The text of proposed Sec.  1.358-5 is the same as the text of Sec.  
1.358-5T published elsewhere in this issue of the Federal Register]

Mark E. Matthews,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 05-10265 Filed 5-23-05; 11:17 am]
BILLING CODE 4830-01-P