[Federal Register Volume 75, Number 240 (Wednesday, December 15, 2010)]
[Rules and Regulations]
[Pages 78160-78161]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-31576]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 9510]
RIN 1545-BJ54


Requirement of a Statement Disclosing Uncertain Tax Positions

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulation.

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SUMMARY: This document contains final regulations allowing the IRS to 
require corporations to file a schedule disclosing uncertain tax 
positions related to the tax return as required by the IRS.

DATES: Effective date: This regulation is effective on December 15, 
2010.
    Applicability date: For dates of applicability, see Sec.  1.6012-
2(a)(5).

FOR FURTHER INFORMATION CONTACT: Kathryn Zuba at (202) 622-3400 (not a 
toll-free number).

SUPPLEMENTARY INFORMATION:

Background

    This document contains amendments to the Income Tax Regulations (26 
CFR part 1) under section 6012 relating to the returns of income 
corporations are required to file. Section 6011 provides that persons 
liable for a tax imposed by Title 26 shall make a return when required 
by regulations prescribed by the Secretary of the Treasury according to 
the forms and regulations prescribed by the Secretary. Treasury 
Regulation Sec.  1.6011-1 requires every person liable for income tax 
to make the returns required by regulation. Section 6012 requires 
corporations subject to an income tax to make a return with respect to 
that tax. Treasury Regulation Sec.  1.6012-2 sets out the corporations 
that are required to file returns and the form those returns must take.
    A proposed regulation under section 6012 (REG-119046-10) was 
published in the Federal Register on September 9, 2010. Requirement of 
a Statement Disclosing Uncertain Tax Positions, 75 FR 54802 (proposed 
Sept. 9, 2010). The IRS received one written comment concerning the 
proposed regulation, and a public hearing regarding the proposed 
regulation was held on October 19, 2010. Neither of the two speakers at 
the public hearing had comments relating to the proposed regulation, 
although both organizations the speakers represented had previously 
submitted written comments concerning the draft Schedule UTP and 
instructions. Announcement 2010-30, 2010-19 IRB 668. After considering 
the comments, the proposed regulation is adopted by this Treasury 
decision with one non-substantive change related to the effective date. 
While the proposed regulation applied to returns filed for tax years 
beginning after December 15, 2009 and ending after the date the 
regulations were published in the Federal Register, the final 
regulation applies to returns filed for tax years beginning on or after 
January 1, 2010.

Explanation and Summary of Comments

    This rule will authorize the IRS to require certain corporations, 
as set out in forms, publications, instructions, or other guidance, to 
provide information concerning uncertain tax positions concurrent with 
the filing of a return. On September 24, 2010, the IRS released 
Schedule UTP with accompanying instructions that explain how the IRS 
plans to implement the authority provided by this regulation. One 
commentator asked that the proposed regulation not be adopted because 
Schedule UTP would require the disclosure of privileged information. If 
the regulation is adopted, the commentator recommended it should state 
that taxpayer may assert any applicable privileges to providing 
information sought by Schedule UTP and that any disclosure of 
information on that schedule will not constitute a waiver of any 
applicable privilege.
    The final regulation does not adopt this recommendation. The 
regulation addresses the IRS's authority to require certain 
corporations to provide information concerning uncertain tax positions. 
The IRS has decided to require the filing of Schedule UTP based on its 
determination that the information about uncertain tax positions taken 
in a tax return required by the schedule is essential to achieving an 
effective and efficient self-assessment tax system. Provisions relating 
to the assertion of privilege are not included in this regulation, 
since it does not affect the existence of any applicable privileges 
taxpayers may have concerning information requested by a return or how 
they may assert those privileges.

Special Analyses

    It has been determined that this final rule is not a significant 
regulatory action as defined in Executive Order 12866. Therefore, a 
regulatory assessment is not required.
    This regulation will only affect taxpayers that prepare or are 
required to issue audited financial statements. Small entities rarely 
prepare or are required to issue audited financial statements due to 
the expense involved. It is hereby certified that this regulation will 
not have a significant economic impact on a substantial number of small 
entities pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 
6). Accordingly, a regulatory flexibility analysis is not required. 
Pursuant to 5 U.S.C. 553(d)(3), it has been determined that there is 
good cause for the effective date of this final rule, which is less 
than 30 days after the date of publication.
    Pursuant to section 7805(f) of the Internal Revenue Code, the 
notice of proposed rulemaking preceding this regulation was submitted 
to the Chief Counsel for Advocacy of the Small Business Administration 
for comment on their impact on small business.

Drafting Information

    The principal author of these regulations is Kathryn Zuba of the 
Office of the Associate Chief Counsel (Procedure and Administration).

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

0
Accordingly, 26 CFR part 1 is amended as follows:

[[Page 78161]]

PART 1--INCOME TAXES

0
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.* * *
    Section 1.6012-2 is also issued under the authority of 26 U.S.C. 
6011 and 6012.

0
Par. 2. Section 1.6012-2 is amended by adding paragraphs (a)(4) and (5) 
to read as follows:


Sec.  1.6012-2  Corporations required to make returns of income.

    (a) * * *
    (4) Disclosure of uncertain tax positions. A corporation required 
to make a return under this section shall attach Schedule UTP, 
Uncertain Tax Position Statement, or any successor form, to such 
return, in accordance with forms, instructions, or other appropriate 
guidance provided by the IRS.
    (5) Effective/applicability date. Paragraph (a)(4) of this section 
applies to returns filed for tax years beginning on or after January 1, 
2010.
* * * * *

Steven T. Miller
Deputy Commissioner for Services and Enforcement.
    Approved: December 9, 2010.
Michael Mundaca,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2010-31576 Filed 12-13-10; 11:15 am]
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