[Federal Register Volume 84, Number 74 (Wednesday, April 17, 2019)]
[Rules and Regulations]
[Pages 15954-15955]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-07652]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9847]
RIN 1545-BO71
Qualified Business Income Deduction; Correction
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Correcting amendments.
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SUMMARY: This document contains corrections to final regulations (TD
9847) that were published in the Federal Register on Friday, February
8, 2019. The final regulations are concerning the deduction for
qualified business income under section 199A of the Internal Revenue
Code.
DATES: This correction is effective on April 17, 2019 and is applicable
on or after February 8, 2019.
FOR FURTHER INFORMATION CONTACT: Vishal R. Amin or Sonia K. Kothari at
(202) 317-6850 or Robert D. Alinsky, Margaret Burow, or Wendy L.
Kribell at (202) 317-5279.
SUPPLEMENTARY INFORMATION:
Background
The final regulations (TD 9847), published on February 8, 2019 (84
FR 2952), that are the subject of this correction are issued under
section 199A of the Internal Revenue Code.
Need for Correction
As published, the final regulations (TD 9847) contain errors that
need to be corrected.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Correction of Publication
Accordingly, 26 CFR part 1 is corrected by making the following
correcting amendments:
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 1.199A-0 is amended by revising the entry for Sec.
1.199A-1(a)(16) and adding an entry for Sec. 1.199A-2(b)(2)(iv) to
read as follows:
Sec. 1.199A-0 Table of contents.
* * * * *
Sec. 1.199A-1 Operational rules.
(a) * * *
(16) W-2 wages.
* * * * *
Sec. 1.199A-2 Determination of W-2 Wages and unadjusted basis
immediately after acquisition of qualified property.
* * * * *
(b) * * *
(2) * * *
(iv) Methods for calculating W-2 wages.
* * * * *
0
Par. 3. Section 1.199A-1 is amended by revising the second sentence of
paragraph (b)(10) and the seventh
[[Page 15955]]
sentence of paragraph (d)(4)(xi)(B) to read as follows:
Sec. 1.199A-1 Operational rules.
* * * * *
(b) * * *
(10) * * * Other passthrough entities including common trust funds
as described in Sec. 1.6032-1T and religious or apostolic
organizations described in section 501(d) are also treated as RPEs if
the entity files a Form 1065, U.S. Return of Partnership Income, and is
owned, directly or indirectly, by at least one individual, estate, or
trust. * * *
* * * * *
(d) * * *
(4) * * *
(xi) * * *
(B) * * * Thus, F has overall net QBI of $80,000 when all trades or
businesses are taken together ($200,000) plus $150,000 minus $120,000
minus the carryover loss of ($150,000). * * *
* * * * *
0
Par. 4. Section 1.199A-2 is amended by revising the fifth sentence of
paragraph (b)(2)(iii)(A) to read as follows:
Sec. 1.199A-2 Determination of W-2 wages and unadjusted basis
immediately after acquisition of qualified properly.
* * * * *
(b) * * *
(2) * * *
(iii) * * *
(A) * * * Section 6071(c) provides that Forms W-2 and W-3 must be
filed on or before January 31 of the year following the calendar year
to which such returns relate (but see the special rule in Sec.
31.6071(a)-1T(a)(3)(i) of this chapter for monthly returns filed under
Sec. 31.6011(a)-5(a) of this chapter). * * *
* * * * *
0
Par. 5. Section 1.199A-4 is amended by revising the fourth sentence of
paragraph (c)(3), the first sentence of paragraph (c)(4)(ii), and the
third sentence of paragraph (d)(15)(ii) to read as follows:
Sec. 1.199A-4 Aggregation.
* * * * *
(c) * * *
(3) * * * However, an RPE may add a newly created or newly acquired
(including through non-recognition transfers) trade or business to an
existing aggregated trade or business (including the aggregated trade
or business of a lower-tier RPE) if the requirements of paragraph
(b)(1) of this section are satisfied. * * *
(4) * * *
(ii) * * * If an RPE fails to attach the statement required in
paragraph (c)(4)(i) of this section, the Commissioner may disaggregate
the RPE's trades or businesses. * * *
(d) * * *
(15) * * *
(ii) * * * If PRS2 does aggregate the two businesses, PRS1 may not
aggregate its food service business with PRS2's aggregated trades or
businesses. * * *
* * * * *
0
Par. 6. Section 1.199A-5 is amended by revising the sixth sentence of
paragraph (b)(3)(xiv) and the eighth sentence of paragraph
(d)(3)(iii)((B) to read as follows:
Sec. 1.199A-5 Specified service trades or businesses and the trade
or business of performing services as an employee.
* * * * *
(b) * * *
(3) * * *
(xiv) * * * Several of the employees and K have worked in the
bicycle business for many years, and have acquired substantial skill
and reputation in the field. * * *
* * * * *
(d) * * *
(3) * * *
(iii) * * *
(B) * * * Unless the presumption is rebutted with a showing that,
under Federal tax law, regulations, and principles (including common-
law employee classification rules), C is not an employee, C's
distributive share of Law Firm 2 income (including any guaranteed
payments) will not be QBI for purposes of section 199A.* * *
* * * * *
Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division,
Associate Chief Counsel (Procedure and Administration).
[FR Doc. 2019-07652 Filed 4-16-19; 8:45 am]
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