[Federal Register Volume 75, Number 165 (Thursday, August 26, 2010)]
[Rules and Regulations]
[Pages 52458-52459]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-21049]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 301

[TD 9500]
RIN 1545-BJ47


Disclosures of Return Information Reflected on Returns to 
Officers and Employees of the Department of Commerce for Certain 
Statistical Purposes and Related Activities

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final and temporary regulations.

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SUMMARY: This document contains final and temporary regulations that 
authorize the disclosure of certain items of return information to the 
Bureau of the Census (Bureau) in conformance with section 6103(j)(1) of 
the Internal Revenue Code (Code). The final and temporary regulations 
are made pursuant to a request from the Secretary of Commerce. These 
regulations facilitate the assistance of the IRS to the Bureau in its 
statistics programs and require no action by taxpayers and have no 
effect on their tax liabilities. The text of the temporary regulations 
also serves as the text of the proposed regulations [REG-137486-09] set 
forth in the Proposed Rules section in this issue of the Federal 
Register.

DATES: Effective Date: These regulations are effective on August 26, 
2010.
    Applicability Date: For dates of applicability for this regulation, 
see Sec. Sec.  301.6103(j)(1)-1(e) and 301.6103(j)(1)-T(e).

FOR FURTHER INFORMATION CONTACT: Melissa Segal at (202) 622-7950 (not a 
toll-free call).

SUPPLEMENTARY INFORMATION:

Background

    Section 6103(j)(1)(A) authorizes the Secretary of Treasury to 
furnish, upon written request by the Secretary of Commerce, such return 
or return information as the Secretary of Treasury may prescribe by 
regulation to officers and employees of the Bureau of the Census 
(Bureau) for the purpose of, but only to the extent necessary in, the 
structuring of censuses and conducting related statistical activities 
authorized by law. Section 301.6103(j)(1)-1 of the regulations further 
defines such purposes by reference to 13 U.S.C. chapter 5 and provides 
an itemized description of the return information authorized to be 
disclosed for such purposes.
    This document adopts final regulations that authorize the IRS to 
disclose an additional item of return information requested by the 
Secretary of Commerce to assist the Bureau in identifying companies 
that are actively engaged in research and development activities for 
the Bureau's annual Survey of Industrial Research and Development. In 
response to this request, on December 31, 2007, the IRS and the 
Treasury Department published temporary regulations under Sec.  
6103(j)(1). See TD 9373 (72 FR 74192). Also on December 31, 2007, the 
IRS and the Treasury Department issued a notice of proposed rulemaking 
cross-referencing those temporary regulations. See REG-147832-07 (72 FR 
74246). No comments were received and no public hearing was requested 
or held. This Treasury decision adopts the proposed rules with no 
change.
    This Treasury decision also contains temporary regulations that 
authorize the disclosure of additional items of return information 
requested by the Secretary of Commerce on the grounds that the 
information is necessary to allow the Bureau to study a developing 
trend of increased use of contract workers. The text of the temporary 
regulations also serves as the text of the proposed regulations set 
forth in the notice of proposed rulemaking on this subject in the 
Proposed Rules section of this issue of the Federal Register.

Explanation of Provisions

    By letter dated February 6, 2006, the Secretary of Commerce 
requested that an additional item of return information be disclosed to 
the Bureau's annual Survey of Industrial Research and Development. As 
duly requested by the Secretary of Commerce and set forth in the 
proposed regulations, the final regulation authorizes the disclosure of 
categorical information on total qualified research expenses in three 
ranges: Greater than zero, but less than $1 million; greater than or 
equal to $1 million, but less than $3 million; and, greater than or 
equal to $3 million.
    Separately, by letter dated July 24, 2009, the Secretary of 
Commerce requested that additional items of return information be 
disclosed to the Bureau for purposes of allowing the Bureau to study a 
developing trend of increased use of contract workers. Specifically, 
the Secretary of Commerce requested disclosure of the following 
additional items: (1) Total number of documents reported on Form 1096 
transmitting Forms 1099-MISC and (2) Total amount reported on Form 1096 
transmitting Forms 1099-MISC.

[[Page 52459]]

    Section 301.6103(j)(1)-1 of the regulations formerly permitted 
disclosure of the total number of documents reported on Form 1096 
transmitting Forms 1099-MISC and the total amount reported on Form 1096 
transmitting Forms 1099-MISC. At the request of the Secretary of 
Commerce, the Treasury Department removed these items from the list of 
items of return information authorized to be disclosed (See TD 9372, 72 
FR 73262 [Dec. 27, 2007]). This removal was consistent with the 
Secretary of Commerce's practice to seek revocation of authorizations 
for disclosure of return information no longer considered necessary for 
the structuring of censuses or related statistical activity.
    The Secretary of Commerce has since determined that these items of 
return information are necessary for the structuring of census and 
conducting related statistical activities authorized by law because 
these items provide critical data about contract labor that is needed 
to estimate total employment and payroll in the United States. The 
employment and compensation data compiled by the Census Bureau are 
important to analysts and policy makers in both the public and private 
sectors. The Secretary of Commerce asserts that, because of the strong 
need for this data in order to accurately reflect total employment and 
payroll in the United States, good cause exists to amend Section 
301.6103(j)(1)-1 of the regulations to restore the items listed in this 
section to the list of items of return information that may be 
disclosed. The Treasury Department and the IRS agree that amending 
existing regulations to permit disclosure of these items to the Bureau 
is appropriate to meet the analytical needs of the Bureau.

Special Analyses

    It has been determined that this Treasury decision is not a 
significant regulatory action as defined in Executive Order 12866. 
Therefore, a regulatory assessment is not required. It also has been 
determined that section 553(b) of the Administrative Procedures Act (5 
U.S.C. chapter 5) does not apply to these regulations. For 
applicability of the Regulatory Flexibility Act, please refer to the 
cross-referenced notice of proposed rulemaking published elsewhere in 
this Federal Register. Pursuant to section 7805(f) of the Code, this 
regulation has been submitted to the Chief Counsel for Advocacy of the 
Small Business Administration for comment on its impact on small 
business.

Drafting Information

    The principal author of these regulations is Melissa Segal, Office 
of the Associate Chief Counsel (Procedure & Administration).

List of Subjects in 26 CFR Part 301

    Employment taxes, Estate taxes, Gift taxes, Income taxes, 
Penalties, Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

0
Accordingly, 26 CFR part 301 is amended as follows:

PART 301--PROCEDURE AND ADMINISTRATION

0
Paragraph 1. The authority citation for part 301 continues to read in 
part as follows:

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


0
Par. 2. Section 301.6103(j)(1)-1 is amended by adding paragraph 
(b)(3)(xxv) and revising paragraph (e) to read as follows:


Sec.  301.6103(j)(1)-1  Disclosure of return information reflected on 
returns to officers and employees of the Department of Commerce for 
certain statistical purposes and related activities.

* * * * *
    (b) * * *
    (3) * * *
    (xxv) From Form 6765 (when filed with corporation income tax 
returns)--total qualified research expenses.
* * * * *
    (e) Effective/applicability date. Paragraph (b)(3)(xxv) of this 
section is applicable to disclosures to the Bureau of the Census on or 
after August 26, 2010.

0
Par. 3. Section 301.6103(j)(1)-1T is amended by:
0
1. Reserve paragraphs (b)(3)(xxvi) through (b)(3)(xxviii).
0
2. Adding paragraphs (b)(3)(xxix) and (b)(3)(xxx).
0
3. Revising paragraph (e).
0
4. Adding a sentence at the end of paragraph (f).


Sec.  301.6103(j)(1)-1T  Disclosures of return information reflected on 
returns to officers and employees of the Department of Commerce, for 
certain statistical purposes and related activities (temporary).

* * * * *
    (b)(3)(xxvi) through (b)(3)(xxviii) [Reserved]. For further 
guidance, see Sec.  301.6103(j)(1)-1(b)(3)(xxvi) through 
(b)(3)(xxviii).
    (xxix) Total number of documents reported on Form 1096 transmitting 
Forms 1099-MISC.
    (xxx) Total amount reported on Form 1096 transmitting Forms 1099-
MISC.
* * * * *
    (e) Effective/applicability date. Paragraph (b)(3)(xxix) through 
(b)(3)(xxx) of this section is applicable to disclosures to the Bureau 
of the Census on or after August 26, 2010.
    (f) * * * The applicability of paragraphs (b)(3)(xxix) through 
(b)(3)(xxx) of this section expires on or before August 26, 2013.

Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
    Approved: August 11, 2010.
Michael Mundaca,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2010-21049 Filed 8-25-10; 8:45 am]
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