[Federal Register Volume 79, Number 179 (Tuesday, September 16, 2014)]
[Rules and Regulations]
[Pages 55362-55363]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-22036]



Internal Revenue Service

26 CFR Part 31

[TD 9692]
RIN 1545-BL92

Authority for Voluntary Withholding on Other Payments

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations and removal of temporary regulations.


SUMMARY: This document contains final regulations under section 3402(p) 
of the Internal Revenue Code (Code) relating to voluntary withholding 
agreements. The final regulations allow the Secretary to issue guidance 
in the Internal Revenue Bulletin to describe payments for which the 
Secretary finds that income tax withholding under a voluntary 
withholding agreement would be appropriate. The regulations affect 
persons making and persons receiving payments for which the IRS issues 
subsequent guidance authorizing the parties to enter into voluntary 
withholding agreements.

DATES: Effective Date: These regulations are effective on September 16, 
    Applicability Date: For date of applicability, see Sec.  

FOR FURTHER INFORMATION CONTACT: Linda L. Conway-Hataloski at (202) 
317-6798 (not a toll-free number).

[[Page 55363]]



    This document contains amendments to 26 CFR part 31 under section 
3402(p) of the Code. On November 29, 2013, Treasury and the IRS 
published in the Federal Register temporary regulations (TD 9646) at 78 
FR 71476 and a notice of proposed rulemaking by cross-reference to 
temporary regulations (REG-146620-13, 78 FR 71542) under section 
3402(p) of the Code relating to voluntary withholding.
    Two written comments responding to the notice of proposed 
rulemaking were received but neither comment addressed issues relevant 
to the notice of proposed rulemaking or the temporary regulations. No 
public hearing was requested or held. Accordingly, the proposed 
regulations (which cross referenced the temporary regulations) are 
adopted without change as final regulations.

Explanation of Provisions

    These final regulations under section 31.3402(p)-1 adopt without 
change the proposed regulations and the temporary regulations that 
allow the Secretary to describe other payments subject to voluntary 
withholding agreements in guidance published in the Internal Revenue 
Bulletin (IRB). Similarly to the proposed and the temporary 
regulations, these final regulations also provide that the IRB guidance 
will set forth requirements regarding the form and duration of the 
voluntary withholding agreement specific to the type of payment from 
which withholding is authorized.

Special Analyses

    It has been determined that this Treasury decision 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 also 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 the 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, these regulations have been submitted to 
the Chief Counsel for Advocacy of the Small Business Administration for 
comment on their impact on small business, and no comments were 

Drafting Information

    The principal author of these regulations is Linda L. Conway-
Hataloski, Office of Division Counsel/Associate Chief Counsel (Tax 
Exempt and Government Entities). However, personnel from other offices 
of the IRS and Treasury participated in their development.

List of Subjects in 26 CFR Part 31

    Employment taxes, Income taxes, Penalties, Pensions, Railroad 
retirement, Reporting and recordkeeping requirements, Social security, 
Unemployment compensation.

Adoption of Amendments to the Regulations

    Accordingly, 26 CFR part 31 is amended as follows:


Paragraph 1. The authority citation for part 31 continues to read in 
part as follows:

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

Par. 2. Section 31.3402(p)-1 is amended by:
1. Revising the headings of paragraphs (a) and (b).
2. Removing the language ``3402(b)'' in the first sentence and 
``3402(p)'' in the third sentence of paragraph (a) and ``3402(p)'' in 
the five places that it appears in paragraph (b) and adding 
``3402(p)(3)(A)'' in their place.
3. Adding paragraphs (c) and (d).
    The revisions and additions read as follows:

Sec.  31.3402(p)-1  Voluntary Withholding Agreements.

    (a) Employer-employee agreement. * * *
    (b) Form and duration of employer-employee agreement. * * *
    (c) Other payments. The Secretary may issue guidance by publication 
in the Internal Revenue Bulletin (IRB) (which will be available at 
www.IRS.gov) describing other payments for which withholding under a 
voluntary withholding agreement would be appropriate and authorizing 
payors to agree to withhold income tax on such payments if requested by 
the payee. Requirements regarding the form and duration of voluntary 
withholding agreements authorized by this paragraph (c) will be 
provided in the IRB guidance issued regarding specific types of 
    (d) Effective/applicability date. (1) This section applies on and 
after September 16, 2014.

Sec.  31.3402(p)-1T  [Removed]

Par. 3. Section 31.3402(p)-1T is removed.

John Dalrymple,
Deputy Commissioner for Services and Enforcement.
    Approved: September 8, 2014.
Mark J. Mazur,
 Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2014-22036 Filed 9-15-14; 8:45 am]