[Federal Register Volume 77, Number 173 (Thursday, September 6, 2012)]
[Proposed Rules]
[Pages 54862-54863]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-21987]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[REG-138489-09]
RIN 1545-BI93


Integrated Hedging Transactions of Qualifying Debt

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 and the Treasury Department are issuing 
temporary regulations (TD 9598) under section 988(d) of the Internal 
Revenue Code. These regulations address certain integrated transactions 
that involve a foreign currency denominated debt instrument and 
multiple associated hedging transactions. The text of the 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 December 5, 2012.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-138489-09), 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-
138489-09), Courier's Desk, Internal Revenue Service, 1111 Constitution 
Avenue NW., Washington, DC, or sent electronically, via the Federal 
eRulemaking Portal at www.regulations.gov (IRS and REG-138489-09).

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, Sheila 
Ramaswamy, at (202) 622-3870; concerning submissions and delivery of 
comments, Oluwafunmilayo Taylor, 202-622-7180 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Background

    The temporary regulations published in the Rules and Regulations 
section of this issue of the Federal Register provide guidance 
regarding certain integrated transactions that involve a foreign 
currency denominated debt instrument and multiple associated hedging 
transactions. The text of those temporary regulations also serves as 
the text of these proposed regulations. The preamble to the temporary 
regulations explains the temporary regulations and these 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. Therefore, a regulatory assessment is not required. It has also 
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 provisions of the Regulatory Flexibility Act (5 U.S.C. 
chapter 6) do 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 written (a signed original and eight 
(8) copies) or electronic comments that are submitted timely to the 
IRS. The IRS and the Treasury Department request comments on the 
clarity of the proposed rules and how they can 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

[[Page 54863]]

place for a public hearing will be published in the Federal Register.

Drafting Information

    The principal author of these proposed regulations is Sheila 
Ramaswamy, Office of Associate Chief Counsel (International). 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 Amendment 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 continues to read in 
part as follows:

    Authority:  26 U.S.C. 7805 * * *
    Par. 2.
    Section 1.988-5 is amended by revising paragraph (a)(6)(ii) and 
adding paragraph (a)(9)(iv) Example 11 and paragraph (h) to read as 
follows:


Sec.  1.988-5  Section 988(d) hedging transactions.

    (a) * * *
    (6) * * *
    (ii) [The text of these proposed amendments to Sec.  1.988-
5(a)(6)(ii) is the same as the text of Sec.  1.988-5T(a)(6)(ii) 
published elsewhere in this issue of the Federal Register.]
* * * * *
    (9) * * *
    (iv) * * *
* * * * *
    Example 11: [The text of these proposed amendments to Sec.  1.988-
5(a)(9)(iv) Example 11 is the same as the text of Sec.  1.988-
5T(a)(9)(iv) Example 11 published elsewhere in this issue of the 
Federal Register.]
* * * * *
    (h) [The text of these proposed amendments to Sec.  1.988-5(h) is 
the same as the text of Sec.  1.988-5T(h) published elsewhere in this 
issue of the Federal Register.]

 Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 2012-21987 Filed 9-5-12; 8:45 am]
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