[Federal Register Volume 76, Number 129 (Wednesday, July 6, 2011)]
[Proposed Rules]
[Pages 39341-39343]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-16857]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[REG-118809-11]
RIN 1545-BK27


Modification of Treasury Regulations Pursuant to Section 939A of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act

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 
that remove any reference to, or requirement of reliance on, credit 
ratings in regulations under the Internal Revenue Code (Code) and 
provide substitute standards of credit-worthiness where appropriate. 
The Dodd-Frank Wall Street Reform and Consumer Protection Act requires 
each Federal agency to take such actions regarding its regulations. 
These regulations affect persons subject to various provisions of the 
Code. The text of the temporary regulations published in the Rules and 
Regulations section of the Federal Register also serves as the text of 
the proposed regulations.

DATES: Written and electronic comments and requests for a public 
hearing must be received by August 30, 2011.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-118809-11), Room 
5203, Internal Revenue Service, PO Box 7604, Ben Franklin Station, 
Washington, DC 20044. Submissions may be hand-delivered to: 
CC:PA:LPD:PR Monday through Friday between the hours of 8 a.m. and 4 
p.m. to: CC:PA:LPD:PR (REG-118809-11), Courier's Desk, Internal Revenue 
Service, 1111 Constitution Avenue, NW., Washington, DC, or sent 
electronically via the Federal eRulemaking Portal at http://www.regulations.gov (IRS REG-118809-11).

FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, 
Arturo Estrada, (202) 622-3900; concerning submissions of comments and 
requests for a public hearing, Oluwafunmilayo Taylor, (202) 622-7180 
(not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Background

    Section 939A(a) of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act, Public Law 111-203 (124 Stat. 1376 (2010)), (the 
``Dodd-Frank Act''), requires each Federal agency to review its 
regulations that require the use of an assessment of credit-worthiness 
of a security or money market instrument, and to review any references 
or requirements in those regulations regarding credit ratings. Section 
939A(b) directs each agency to modify any regulation identified in the 
review required under section 939A(a) by removing any reference to, or 
requirement of reliance on, credit ratings and substituting a standard 
of credit-worthiness that the agency deems appropriate. Numerous 
provisions under the Code are affected.
    Temporary regulations in the Rules and Regulations section of this 
issue of the Federal Register amend the Income Tax Regulations (26 CFR 
part 1) under sections 150, 171, 197, 249, 475, 860G, and 1001 of the 
Code. The temporary regulations also amend the Manufacturers and 
Retailers Excise Tax Regulations (26 CFR part 48) under section 4101 of 
the Code. The text of the temporary regulations also serves as the text 
of these proposed regulations. The preamble to the temporary 
regulations explains the temporary regulations and the proposed 
regulations.

Special Analyses

    It has been determined that this notice of proposed rulemaking is 
not a significant regulatory action as defined in Executive Order 
12866, as supplemented by Executive Order 13563. Therefore, a 
regulatory assessment is not required. It 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 these 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 Code, this notice of proposed 
rulemaking has been submitted to the Chief Counsel for Advocacy of the 
Small Business Administration for comment on its impact on small 
business.

[[Page 39342]]

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) or electronic comments that are submitted timely 
to the IRS. The IRS and the Treasury Department specifically request 
comments on the clarity of the proposed regulations and how they may be 
made easier to understand. All comments will be available for public 
inspection and copying. A public hearing may be scheduled if requested 
in writing by any 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

    These regulations were drafted by personnel in the Office of 
Associate Chief Counsel (Financial Institutions and Products), the 
Office of Associate Chief Counsel (Income Tax and Accounting), the 
Office of Associate Chief Counsel (International) and the Office of the 
Associate Chief Counsel (Passthroughs and Special Industries). However, 
other personnel from the IRS and the Treasury Department participated 
in their development.

List of Subjects

26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

26 CFR Part 48

    Excise taxes, Reporting and recordkeeping requirements.

Proposed Amendments to the Regulations

    Accordingly, 26 CFR parts 1 and 48 are 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 1.150-1 is amended as follows:
    1. Paragraph (a)(4) is added.
    2. In paragraph (b), the definition of Issuance costs, is revised.
    The addition and revision read as follows:


Sec.  1.150-1  Definitions.

* * * * *
    (4) [The text of the proposed amendments to Sec.  1.150-1(a)(4) is 
the same as the text of Sec.  1.150-1T(a)(4) published elsewhere in 
this issue of the Federal Register].
    (b) * * *
    Issuance costs. [The text of the proposed amendments to Sec.  
1.150-1(b), Issuance costs, is the same as the text of Sec.  1.150-
1T(b), Issuance costs, published elsewhere in this issue of the Federal 
Register].
* * * * *
    Par. 3. Section 1.171-1 is amended by revising paragraph (f) 
Example 2 to read as follows:


Sec.  1.171-1  Bond premium.

* * * * *
    (f) * * *

    Example 2. [The text of the proposed amendments to Sec.  1.171-
1(f) Example 2 is the same as the text of Sec.  1.171-1T(f) Example 
2 published elsewhere in this issue of the Federal Register].

    Par. 4. Section 1.197-2 is amended by revising paragraph (b)(7) to 
read as follows:


Sec.  1.197-2  Amortization of goodwill and certain other intangibles.

* * * * *
    (b) * * *
    (7) [The text of the proposed amendments to Sec.  1.197-2(b)(7) is 
the same as the text of Sec.  1.197-2T(b)(7) published elsewhere in 
this issue of the Federal Register].
* * * * *
    Par. 5. Section 1.249-1 is amended by revising paragraphs 
(e)(2)(ii) and adding paragraph (f)(3) to read as follows:


Sec.  1.249-1  Limitation on deduction of bond premium on repurchase.

* * * * *
    (e) * * *
    (2) * * *
    (ii) [The text of the proposed amendments to Sec.  1.249-
1(e)(2)(ii) is the same as the text of Sec.  1.249-1T(e)(2)(ii) 
published elsewhere in this issue of the Federal Register].
* * * * *
    (f) Effective/applicability dates. * * *
    (3) [The text of the proposed amendments to Sec.  1.249-1(f)(3) is 
the same as the text of Sec.  1.249-1T(f)(3) published elsewhere in 
this issue of the Federal Register].
* * * * *
    Par. 6. Section 1.475(a)-4 is amended by revising paragraph (d)(4) 
Examples 1, 2, and 3 to read as follows:


Sec.  1.475(a)-4  Valuation safe harbor.

* * * * *
    (d) * * *
    (4) * * *

    Example 1. [The text of the proposed amendments to Sec.  
1.475(a)-(4)(d)(4) Example 1 is the same as the text of Sec.  
1.475(a)-4T(d)(4) Example 1 published elsewhere in this issue of the 
Federal Register].
    Example 2.  [The text of the proposed amendments to Sec.  
1.475(a)-4(d)(4) Example 2 is the same as the text of Sec.  
1.475(a)-4T(d)(4) Example 2 published elsewhere in this issue of the 
Federal Register].
    Example 3.  [The text of the proposed amendments to Sec.  
1.475(a)-4(d)(4) Example 3 is the same as the text of Sec.  
1.475(a)-4T(d)(4) Example 3 published elsewhere in this issue of the 
Federal Register].
* * * * *
    Par. 7. Section 1.860G-2 is amended by revising paragraphs 
(g)(3)(ii)(B), (C), and (D) to read as follows:


Sec.  1.860G-2  Other rules.

* * * * *
    (g) * * *
    (3) * * *
    (ii) * * *
    (B) [The text of the proposed amendments to Sec.  1.860G-
2(g)(3)(ii)(B) is the same as the text of Sec.  1.860G-2T(g)(3)(ii)(B) 
published elsewhere in this issue of the Federal Register].
    (C) [The text of the proposed amendments to Sec.  1.860G-
2(g)(3)(ii)(C) is the same as the text of Sec.  1.860G-2T(g)(3)(ii)(C) 
published elsewhere in this issue of the Federal Register].
    (D) [The text of the proposed amendments to Sec.  1.860G-
2(g)(3)(ii)(D) is the same as the text of Sec.  1.860G-2T(g)(3)(ii)(D) 
published elsewhere in this issue of the Federal Register].
* * * * *
    Par. 8. Section 1.1001-3 is amended as follows:
    1. Paragraph (d) Example 9 is revised.
    2. Paragraph (e)(4)(iv)(B) is revised.
    3. Paragraph (e)(5)(ii)(B)(2) is revised.
    4. Paragraph (g) Examples 1, 5, and 8 are revised.
    The revisions read as follows:


Sec.  1.1001-3  Modifications of debt instruments.

* * * * *
    (d) * * *

    Example 9. [The text of the proposed amendments to Sec.  1.1001-
3(d) Example 9 is the same as the text of Sec.  1.1001-3T(d) Example 
9 published elsewhere in this issue of the Federal Register].
* * * * *
    (e) * * *
    (4) * * *
    (iv) * * *
    (B) [The text of the proposed amendments to Sec.  1.1001-
3(e)(4)(iv)(B) is the same as the text of Sec.  1.1001-3T(e)(4)(iv)(B) 
published elsewhere in this issue of the Federal Register].
* * * * *
    (5) * * *
    (ii) * * *
    (B) * * *

[[Page 39343]]

    (2) [The text of the proposed amendments to Sec.  1.1001-
3(e)(5)(ii)(B)(2) is the same as the text of Sec.  1.1001-
3T(e)(5)(ii)(B)(2) published elsewhere in this issue of the Federal 
Register].
* * * * *
    (g) * * *

    Example 1. [The text of the proposed amendments to Sec.  1.1001-
3(g) Example 1 is the same as the text of Sec.  1.1001-3T(g) Example 
1 published elsewhere in this issue of the Federal Register].
* * * * *
    Example 5.  [The text of the proposed amendments to Sec.  
1.1001-3(g) Example 5 is the same as the text of Sec.  1.1001-3T(g) 
Example 5 published elsewhere in this issue of the Federal 
Register].
* * * * *
    Example 8.  [The text of the proposed amendments to Sec.  
1.1001-3(g) Example 8 is the same as the text of Sec.  1.1001-3T(g) 
Example 8 published elsewhere in this issue of the Federal 
Register].

PART 48--MANUFACTURERS AND RETAILERS EXCISE TAXES

    Par. 9. The authority citation for part 48 continues to read in 
part as follows:

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

    Par. 10. Section 48.4101-1 paragraphs (f)(4)(ii)(B) and (l)(5) are 
revised to read as follows:


Sec.  48.4101-1  Taxable fuel; registration.

* * * * *
    (f) * * *
    (4) * * *
    (ii) * * *
    (B) [The text of the proposed amendments to Sec.  48.4101-
1(f)(4)(ii)(B) is the same as the text of Sec.  48.4101-1T(f)(4)(ii)(B) 
published elsewhere in this issue of the Federal Register].
* * * * *
    (l) * * *
    (5) [The text of the proposed amendments to Sec.  48.4101-1(l)(5) 
is the same as the text of Sec.  48.4101-1T(l)(5) published elsewhere 
in this issue of the Federal Register].

Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 2011-16857 Filed 7-1-11; 11:15 am]
BILLING CODE 4830-01-P