[Federal Register Volume 79, Number 247 (Wednesday, December 24, 2014)]
[Rules and Regulations]
[Pages 77388-77389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-30200]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 9707]
RIN 1545-BM08


Filing of Form 5472

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations.

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SUMMARY: This document contains final regulations concerning the manner 
of filing Form 5472, ``Information Return of a 25% Foreign-Owned U.S. 
Corporation or a Foreign Corporation Engaged in a U.S. Trade or 
Business.'' The final regulations affect certain 25-percent foreign-
owned domestic corporations and certain foreign corporations that are 
engaged in a trade or business in the United States that are required 
to file Form 5472.

DATES: Effective date: These regulations are effective on December 24, 
2014. Applicability date: For dates of applicability, see Sec. Sec.  
1.6038A-1(n)(2) and (n)(3) and 1.6038A-2(g).

FOR FURTHER INFORMATION CONTACT: Anand Desai at (202) 317-6939 (not a 
toll-free number).

SUPPLEMENTARY INFORMATION:

Background

    On June 6, 2014, the Department of the Treasury (Treasury 
Department) and the IRS published a notice of proposed rulemaking (REG-
114942-14) in the Federal Register (79 FR 32687, 2014-26 IRB 1117) 
under sections 6038A and 6038C of the Internal Revenue Code (Code) 
(proposed regulations). The proposed regulations proposed removing a 
provision for timely filing Form 5472 separately from an income tax 
return that is untimely filed (``untimely filed return provision''). As 
a result, Form 5472 would be required to be filed in all cases only 
with the filer's income tax return for the taxable year by the due date 
(including extensions) of that return. No public hearing was requested 
or held. The Treasury Department and the IRS received two written 
comments on the proposed regulations, which are available at 
www.regulations.gov. After consideration of the comments, this Treasury 
decision adopts the proposed regulations, without substantive change, 
as final regulations.

Summary of Comments

    One comment recommended that the ``untimely filed return 
provision'' be retained because the IRS may not timely receive the 
information required by Form 5472 if the untimely filed return 
provision is removed. The comment also recommended conforming changes 
to permit the filing of Form 5471, ``Information Return of U.S. Persons 
With Respect to Certain Foreign Corporations,'' and Form 8865, ``Return 
of U.S. Persons With Respect to Certain Foreign Partnerships,'' 
separately from an income tax return that is untimely filed.
    The Treasury Department and the IRS decline to adopt this comment. 
The Treasury Department and the IRS have determined that tax 
administration generally is more efficient when forms (for example, 
Form 5471, Form 5472, and Form 8865) are filed with the filer's timely 
filed income tax return.
    The second comment addressed issues unrelated to the proposed 
regulatory change. The final regulations do not incorporate the 
suggestions contained in this comment, which are outside the scope of 
the proposed regulations.

Special Analyses

    It has been determined that these regulations are 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 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 the regulations do not impose a 
collection of information, the Regulatory Flexibility Act (5 U.S.C. 
chapter 6) does not apply. Pursuant to section 7805(f) of the 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 its impact on small business.

Drafting Information

    The principal author of these regulations is Anand Desai, Office of 
Associate Chief Counsel (International). However, other personnel from 
the Treasury Department and the IRS participated in their development.

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

    Accordingly, 26 CFR part 1 is amended as follows:

PART 1--INCOME TAXES

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

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


0
Par. 2. Section 1.6038A-1 is amended by revising the third sentence of, 
and adding a new fourth sentence to, paragraph (n)(2), and adding a 
third sentence to paragraph (n)(3), to read as follows:


Sec.  1.6038A-1  General requirements and definitions.

* * * * *
    (n) * * *

[[Page 77389]]

    (2) Section 1.6038A-2. * * * Section 1.6038A-2(d) applies for 
taxable years ending on or after June 10, 2011. For taxable years 
ending on or after June 10, 2011, but before December 24, 2014, see 
Sec.  1.6038A-2(e) as contained in 26 CFR part 1 revised as of April 1, 
2014. * * *
    (3) Section 1.6038A-4. * * * For taxable years ending before 
December 24, 2014, see Sec.  1.6038A-4(a)(1) as contained in 26 CFR 
part 1 revised as of April 1, 2014.
* * * * *


Sec.  1.6038A-2  [Amended]

0
Par. 3. Section 1.6038A-2 is amended by:
0
1. Removing paragraph (e).
0
2. Redesignating paragraphs (f), (g), and (h) as paragraphs (e), (f), 
and (g), respectively.

0
Par. 4. Section 1.6038A-4 is amended by revising paragraph (a)(1) to 
read as follows:


Sec.  1.6038A-4  Monetary penalty.

    (a) * * *
    (1) In general. If a reporting corporation fails to furnish the 
information described in Sec.  1.6038A-2 within the time and manner 
prescribed in Sec.  1.6038A-2(d), fails to maintain or cause another to 
maintain records as required by Sec.  1.6038A-3, or (in the case of 
records maintained outside the United States) fails to meet the non-
U.S. record maintenance requirements within the applicable time 
prescribed in Sec.  1.6038A-3(f), a penalty of $10,000 shall be 
assessed for each taxable year with respect to which such failure 
occurs. The filing of a substantially incomplete Form 5472 constitutes 
a failure to file Form 5472. Where, however, the information described 
in Sec.  1.6038A-2(b)(3) through (5) is not required to be reported, a 
Form 5472 filed without such information is not a substantially 
incomplete Form 5472.
* * * * *

John Dalrymple,
Deputy Commissioner for Services and Enforcement.
    Approved: December 8, 2014.
Mark J. Mazur,
Assistant Secretary for the Treasury (Tax Policy).
[FR Doc. 2014-30200 Filed 12-23-14; 8:45 am]
BILLING CODE 4830-01-P