[Federal Register Volume 86, Number 111 (Friday, June 11, 2021)]
[Rules and Regulations]
[Pages 31146-31151]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-12311]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 1 and 301

[TD 9950]
RIN 1545-BP98


Mandatory 60-Day Postponement of Certain Tax-Related Deadlines by 
Reason of a Federally Declared Disaster

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations.

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SUMMARY: This document contains final regulations relating to the new 
mandatory 60-day postponement of certain time-sensitive tax-related 
deadlines by reason of a federally declared disaster. This document 
also contains final regulations clarifying the definition of 
``federally declared disaster.'' These final regulations affect 
individuals who reside in or were killed or injured in a disaster area, 
businesses that have a principal place of business in a disaster area, 
relief workers who provide assistance in a disaster area, or any 
taxpayer whose tax records necessary to meet a tax deadline are located 
in a disaster area.

DATES: 
    Effective Date: These regulations are effective on June 11, 2021.
    Applicability Date: The date of applicability for the amendment to 
the Procedure and Administration Regulations under section 7508A is 
December 21, 2019, as explained below in SUPPLEMENTARY INFORMATION.
    The date of applicability for the amendment to the Income Tax 
Regulations under section 165 of the Code to clarify the definition of 
the term ``federally declared disaster'' is June 11, 2021.

FOR FURTHER INFORMATION CONTACT: Andrew C. Keaton at (202) 317-5404 
(not a toll-free number).

SUPPLEMENTARY INFORMATION:

[[Page 31147]]

Background

    Section 205 of the Taxpayer Certainty and Disaster Tax Relief Act 
of 2019, enacted as Division Q of the Further Consolidated 
Appropriations Act, 2020, Public Law 116-94, 133 Stat. 2534, 3226, 
amended section 7508A of the Code, relating to the discretionary 
authority of the Secretary of the Treasury or her delegate (Secretary) 
to postpone certain time-sensitive tax deadlines by reason of a 
federally declared disaster, by adding section 7508A(d). This provision 
provides qualified taxpayers a mandatory 60-day period that is to be 
disregarded ``in the same manner as a period specified under [section 
7508A(a)].''
    On January 13, 2021, the IRS published in the Federal Register a 
notice of proposed rulemaking (REG-115057-20, 86 FR 2607) to interpret 
and implement sections 165(i)(5) and 7508A(d). Five responsive written 
comments were received. No commenter requested a public hearing, so 
none was held.
    As described more fully in the preamble to the proposed 
regulations, section 7508A(d) is ambiguous in at least two important 
respects--the time-sensitive acts to be postponed (beyond the pension-
related actions described in section 7508A(d)(4)) are not specified and 
it is unclear how the mandatory 60-day postponement period is to be 
calculated when the disaster declaration specified in section 7508A(d) 
does not contain an incident date. The legislative history is also 
insufficient to explain these areas of ambiguity.
    These final regulations amend the Procedure and Administration 
Regulations (26 CFR part 301) under section 7508A and the Income Tax 
Regulations (26 CFR part 1) under section 165 to clarify the definition 
of the term ``federally declared disaster.'' As described further 
below, the Department of the Treasury (Treasury Department) and the IRS 
have modified proposed Sec.  301.7508A-1(g)(4)(iii), Example (3), in 
these final regulations to better illustrate the calculation of the 
mandatory 60-day postponement period and to correct typographical 
errors. No other changes have been adopted.

Comments on the Proposed Regulations

Section 1.165-11(b)(1)

    The proposed regulations provided that a federally declared 
disaster includes both a major disaster and an emergency declared under 
sections 401 or 501, respectively, of the Robert T. Stafford Disaster 
Relief and Emergency Assistance Act (Stafford Act), Public Law 100-
707,102 Stat. 4689 (1988).
    One commenter said it approved of the proposed regulations 
including emergency declarations in the definition of a federally 
declared disaster under section 165(i)(5)(A). However, another 
commenter was critical of this portion of the proposed regulations and 
recommended that it be stricken. This second commenter said emergency 
declarations are governed by a different set of rules than major 
disaster declarations, pointing out that emergency declarations (i) do 
not need to be preceded by a governor's request for Stafford Act relief 
(but may instead be declared sua sponte by the President), (ii) may 
only result (if not followed up by a major disaster declaration) in 
Federal assistance to local governmental entities (as opposed to 
assistance to individuals), and (iii) may be issued before a disaster. 
This commenter further opined that President Trump's letter of March 
13, 2020, declaring an emergency under the Stafford Act with respect to 
the COVID-19 pandemic, was not authorized by Congress to serve as a 
disaster declaration under sections 165(i)(5)(A) and 7508A of the Code.
    The comment from the second commenter is not adopted in the final 
regulations. In the Explanation of Provisions section of the preamble 
to the proposed regulations, Part III. Federally Declared Disasters, 
this issue is already addressed in detail. There is no provision in the 
Stafford Act to declare a ``disaster.'' The legislative history of the 
Stafford Act indicates that the term ``disaster'' is an umbrella term 
that includes both an emergency and a major disaster. The Conference 
Report to the Disaster Relief and Emergency Assistance Act of 1974, 
Public Law 93-288, 88 Stat. 143 (1974), clarified the definitional 
section of the Stafford Act, stating: ``It was the intention of the 
conferees not to define the term `disaster' specifically; whenever used 
in this legislation such term includes an emergency or a major 
disaster.'' H.R. Rep. 93-1037, p. 26 (May 13, 1974).
    The opening section of the Stafford Act, titled ``Congressional 
findings and declarations,'' uses the generic term ``disaster'' in 
laying out the key congressional findings and declarations that 
underlie the rest of the chapter's provisions. Stafford Act section 
101(a), 42 U.S.C. 5121(a). In multiple revenue rulings, the IRS has 
provided that, for the purposes of section 165(i), a federally declared 
disaster includes an emergency or a major disaster declared under the 
Stafford Act. Several of these revenue rulings are cited in the 
preamble to the proposed regulations.
    The differences noted by the commenter between emergencies and 
major disasters under the Stafford Act are not material to their 
treatment under sections 165(i)(5)(A) and 7508A of the Code. Most 
disaster declarations announced by the Federal Emergency Management 
Agency (FEMA) for particular states also provide only public 
assistance, and no individual assistance, to particular counties in the 
state under the Stafford Act. In addition, most emergency declarations 
announced by FEMA are under section 501(a) of the Stafford Act, and 
begin with a request from a governor or other chief executive of a 
state, territory, or tribal government. As noted in the preamble to the 
proposed regulations, it is rare for an emergency declaration to be 
made without such a request. The President is authorized to make an 
emergency declaration under section 501(b) of the Stafford Act when the 
United States will have the primary responsibility for response to the 
emergency. There is no difference in the need for affected persons in a 
state threatened with a disaster to receive relief from time-sensitive 
deadlines to perform specified acts under the Code when the request for 
such relief originates with the state's governor or is independently 
raised by the President. Consequently, the final regulations make no 
changes to this portion of the proposed regulations.

Section 301.7508A-1(g)(1)-(2)

    The proposed regulations provided that (excluding the pension-
related acts described in section 7508A(d)(4)) the time-sensitive tax 
acts that are postponed for the mandatory 60-day postponement period 
are the acts, if any, that the Secretary determines to be postponed 
under section 7508A(a) or (b).
    One commenter expressed a general concern that this provision had 
the potential to reduce section 7508A(d) to a nullity. A second 
commenter expressed its concerns specifically in terms of what it 
contended was a clear reading of the statute and its legislative 
history. This commenter said it was clear that Congress intended to 
postpone the timely performance of all of the time-sensitive tax acts, 
both taxpayer and government acts, listed in section 7508(a)(1) of the 
Code. However, this second commenter recommended that the final 
regulations provide that the government may take advantage of the 
postponement periods for government-initiated actions only if a 
taxpayer first acts in reliance on the ``automatic'' postponement 
periods for the taxpayer's time-sensitive tax acts.

[[Page 31148]]

    A third commenter agreed with the Secretary's characterizations of 
the statute and legislative history as ambiguous on the issues of which 
time-sensitive tax acts (other than the pension-related tax acts 
described in section 7508A(d)(4)) are postponed under section 7508A(d) 
and of which declared disasters are subject to the mandatory 60-day 
postponement period under section 7508A(d). This commenter approved of 
the solution to these ambiguities that was reflected in the proposed 
regulations, in terms of which time-sensitive tax acts would be 
postponed. This commenter said section 7508A(d) was a poorly-worded 
statute, that the legislative history of the provisions contained 
contradictions, and the result was that section 7508A(d)(1) leaves no 
(non-pension) time-sensitive tax acts for section 7508A(d) to operate 
upon, unless or until the Secretary exercises her powers under section 
7508A(a).
    The third commenter noted also that for the year 2017, the IRS 
provided relief under section 7508A(a) in response to only 14 of the 59 
major disaster declarations announced by FEMA that year. If all major 
disaster declarations automatically entitled all taxpayers in disaster 
areas to timing relief under section 7508A(d), the commenter noted that 
there would be a dramatic increase in the number of disasters leading 
to postponements of time-sensitive tax acts. On these issues, the third 
commenter concluded that the proposed regulations properly preserved 
the discretion of the IRS to determine which declared disasters should 
result in any type of disaster relief and of which time-sensitive tax 
acts should be postponed under section 7508A.
    The comments from the first two commenters on this issue are not 
adopted in the final regulations, while the approving comments of the 
third commenter were already reflected in the proposed regulations. As 
explained more fully in the Explanation of Provisions section of the 
preamble to the proposed regulations, Part I. Time-Sensitive Tax Acts, 
and as noted by the third commenter described above, except for the 
rules regarding pensions described in section 7508A(d)(4), section 
7508A(d), by its terms, does not specify the time-sensitive tax acts to 
be postponed during the mandatory 60-day postponement period. Instead, 
section 7508A(d)(1) provides that the mandatory 60-day postponement 
period ``shall be disregarded in the same manner as a period specified 
under [section 7508A(a)].'' Section 7508A(a) is not self-executing, but 
rather, requires a determination by the Secretary to specify the acts 
to be postponed. As a result, the cross-reference to section 7508A(a) 
in section 7508A(d)(1) operates to require the same determination by 
the Secretary as a prerequisite to determining the acts to which the 
mandatory 60-day postponement period applies. This interpretation gives 
full effect to the statutory language and does not reduce section 
7508A(d) to a nullity, because that section still imposes a mandatory 
period for postponement and establishes a new category of persons 
eligible for relief--the ``qualified taxpayers'' defined in section 
7508A(d)(2). The final regulations make no changes to Sec.  301.7508A-
1(g)(1) and (2) of the proposed regulations.

Section 301.7508A-1(g)(3)(i)

    Section 301.7508A-1(g)(3)(i) of the proposed regulations tracked 
section 7508A(d)(1) and (d)(5) in describing how the mandatory 60-day 
postponement period for federally declared disasters will be calculated 
and how the calculation of that mandatory postponement period will 
interact with the Secretary's discretionary postponement period (if 
any) under section 7508A(a) and (b). The Explanation of Provisions 
section of the preamble to the proposed regulations, Part II. 
Calculation of the Mandatory 60-Day Postponement Period, identified a 
120-day postponement period from the beginning incident date of a 
disaster announced by FEMA as the usual postponement period provided by 
the IRS for those disasters where the IRS exercises its discretion 
under section 7508A(a) or (b) to postpone any time-sensitive tax acts.
    Consequently, most mandatory 60-day postponement periods under 
section 7508A(d) will be calculated to run concurrently with the 120-
day postponement period the IRS generally provides under section 
7508A(a) or (b). Two commenters noted that section 7508A(d)(1) and the 
proposed regulations did not provide a clear rule for calculating the 
mandatory 60-day postponement period when there was more than one 
disaster declaration issued for the same disaster in a particular state 
or when any disaster declaration was amended to provide any new or 
modified incident dates (earliest or latest) that were missing or 
different from when the first disaster declaration for a disaster in a 
state was announced by FEMA. Two commenters suggested potential 
alternative methods of making calculations of the mandatory 60-day 
postponement period more certain when there are multiple disaster 
declarations or disaster declarations that are amended by FEMA for the 
earliest or latest incident dates described in section 7508A(d)(1)(A) 
and (B).
    One commenter claimed that a literal reading of section 7508A(d)(1) 
creates challenges for indefinite disasters, such as the COVID-19 
pandemic, because the statute could be interpreted to postpone a 
taxpayer's deadlines ``indefinitely until some unknown point in time 
that is long after the disaster began.'' To avoid this ``unworkable 
application'' of the statute, this commenter recommended that if the 
initial disaster declaration does not expressly identify the latest 
incident date for a disaster, then section 7508A(d) should be 
interpreted as automatically providing a postponement period until the 
date that is 60 days after the earliest incident date specified in a 
disaster declaration. However, the statute mitigates the commenter's 
concern by directing that the postponement period under section 
7508A(d) ``shall be disregarded in the same manner as a period 
specified under subsection (a).'' That provision ensures that the 
Secretary retains the same discretion as she has under section 7508A(a) 
to determine what time-sensitive tax acts, if any, will be postponed.
    A second commenter noted what it characterized as a pick-and-choose 
problem and an amendment problem with the method of calculating the 
mandatory 60-day postponement period provided for in the proposed 
regulations and recommended the Secretary adopt one of several 
alternative bright-line rules it suggested for making the calculation 
period more predictable.
    This second commenter noted there was a potential pick-and-choose 
problem among multiple potential FEMA-announced disaster declarations, 
because the Treasury Department and the IRS propose to treat FEMA-
announced emergency declarations (as well as major disaster 
declarations) under the Stafford Act as federally declared disasters 
under sections 165 and 7508A of the Code. This commenter's 
recommendation to strike proposed amended regulation Sec.  1.165-
11(b)(1) is discussed and rejected in the preamble discussion of this 
issue above.
    Alternatively, the second commenter recommended that the final 
regulations reflect a bright-line rule to address potential multiple 
declarations, such as a first-out rule (the first issued declaration 
controls), a rule that a later major disaster declaration controls over 
an earlier emergency declaration, or a rule that the issue date of an 
emergency declaration is the earliest incident date for section 
7508A(d)(1)'s mandatory 60-day postponement period.

[[Page 31149]]

    The second commenter further recommended in this section of the 
final regulations that the Treasury Department and the IRS provide a 
bright-line rule concerning the effect of potential amendments to an 
initial FEMA announced disaster declaration on how the mandatory 60-day 
postponement period is calculated. The additional potential bright-line 
alternatives suggested by the second commenter were that (i) future 
amendments will not affect how the mandatory period is calculated, or 
(ii) only amendments made within a certain amount of time (say one 
year) will affect the computation of the mandatory period.
    The Treasury Department and the IRS appreciate the predictability 
offered by the bright-line rules suggested by the second commenter. 
Nevertheless, the statutory language providing for a mandatory period 
beginning on the earliest incident date specified in the disaster 
declaration and ending on the date which is 60 days after the latest 
incident date so specified is capable of being applied as written. 
While amendments to disaster declarations and shifting ``latest'' 
incident dates can cause confusion, the intent of the statute is to 
ensure that relief is provided throughout the disaster period, assuming 
such a period is identified in the disaster declaration and the 
Secretary has determined that postponement of time-sensitive tax acts 
is warranted. As a result, the comment on this issue is not adopted in 
the final regulations.

Section 301.7508A-1(g)(3)(ii)(A)

    The proposed regulations provided that in no event will the 
mandatory 60-day postponement period be calculated to exceed one year. 
One commenter stated that this portion of the proposed regulations 
should be removed because it lacks any basis in the text or legislative 
history of section 7508A(d)(1) or (d)(4).
    The comment on this issue is not adopted in the final regulations. 
As stated in the Explanation of Provisions section of the preamble to 
the proposed regulations, Part II. Calculation of the Mandatory 60-Day 
Postponement Period, it defies logic for the Secretary's discretionary 
postponement period under section 7508A(a) to be limited to ``a period 
of up to 1 year,'' and there be no limit on the mandatory 60-day 
postponement period under section 7508A(d). Interpreting section 
7508A(d) to allow postponement periods for more than 1 year would be 
contrary to the directive of section 7508A(d)(1) that the mandatory 60-
day postponement period must ``be disregarded in the same manner as a 
period specified under [section 7508A(a)].'' The final regulations make 
no change to Sec.  301.7508A-1(g)(3)(ii)(A) of the proposed 
regulations.

Section 301.7508A-1(g)(4)(iii) Example (3)

    The proposed regulations provided an Example (3) concerning a 
continuing disaster declaration involving wildfires that was later 
amended by a subsequent FEMA announcement of a latest incident date for 
the disaster. This example contained typographical errors, including a 
misnumbering--``(5)'' instead of ``(4)''--of the subparagraph for the 
four examples and referring to the taxpayer in the example variously as 
``Individual C'' and ``Individual D.''
    One commenter further noted that the intended rules, if any, which 
Example (3) was meant to illustrate were not described in the portions 
of the proposed regulations which precede the Examples section.
    Example (3) is intended to illustrate the calculation of the 
mandatory 60-day postponement period in the event of an ongoing 
disaster with multiple declarations and shifting ``latest'' incident 
dates described in Sec.  301.7508A-1(g)(3) of these final regulations. 
The Treasury Department and the IRS have modified Example (3) in these 
final regulations, in consideration of the comment above as well as the 
comments received on Sec.  301.7508A-1(g)(3)(i), to better illustrate 
the calculation of the mandatory 60-day postponement period and to 
correct typographical errors.

Section 301.7508A-1(h)(2)

    The proposed regulations provided that the final regulations shall 
apply to all disasters declared on or after December 21, 2019.
    One commenter requested not only that the final regulations not be 
retroactive to the effective date of section 7508A(d), but that the 
final regulations provide relief to any individuals or employee benefit 
plans that took actions (or failed to take actions) based on a good 
faith and reasonable interpretation of the postponement relief provided 
in section 7508A. The commenter further requested that such good faith 
relief be available for at least 60 days after the final regulations 
are published in the Federal Register.
    The Applicability Date discussion in the preamble to the proposed 
regulations clearly indicated the intention of the Treasury Department 
and the IRS to rely on the provisions of section 7805(b)(2) of the Code 
for the applicability date of these final regulations. Section 
7805(b)(2) provides that regulations filed or issued within 18 months 
of the date of enactment of the statutory provision to which the 
regulations relate are not prohibited from applying retroactively to 
the date of enactment. Section 7508A(d) was enacted on December 20, 
2019, and these final regulations have been filed or issued within 18 
months of that date of enactment. The proposed regulations were clear 
in stating that the Treasury Department and the IRS intended for the 
final regulations to apply to any disasters that were declared on or 
after December 21, 2019. These final regulations do not adopt the 
commenter's request to modify Sec.  301.7508A-1(h)(2) of the proposed 
regulations.

New Rule Proposal

    One commenter requested that the final regulations ``confirm'' that 
all forms of deadline relief requested under section 7508A are optional 
for affected taxpayers. In particular, the commenter focused on 
deadlines arising under employee benefit plans. In some cases, the 
application of these deadlines may affect both the plan and the 
participants. After consideration, the Treasury Department and the IRS 
have concluded that the suggestions made in this comment are beyond the 
intended scope of the proposed regulations. Consequently, the 
suggestions are not adopted in these final regulations.

Modifications of Proposed Regulations

Section 301.7508A-1(g)(4)(iii) Example (3)

    Example (3) is modified to better illustrate the calculation of the 
mandatory 60-day postponement period in the event of multiple 
declarations and shifting ``latest'' incident dates, and to correct 
typographical errors.

Applicability Dates

    For date of applicability for the amendment to the Procedure and 
Administration Regulations under section 7508A, see Sec.  301.7508A-
1(h), which provides that the regulations promulgated by this Treasury 
decision are applicable for federally declared disasters that are 
declared on or after December 21, 2019, as explained in the preamble to 
the proposed regulations (REG-115057-20) published in the Federal 
Register (86 FR 2607), because section 7805(b)(2) of the Internal 
Revenue Code (Code) provides that regulations filed or issued within 18 
months of the date of the enactment of

[[Page 31150]]

the statutory provision to which they relate may apply to taxable 
periods prior to those described in section 7805(b)(1) and these final 
regulations are being published within 18 months of the enactment of 
section 7508A(d) on December 20, 2019.
    The date of applicability for the amendment to the Income Tax 
Regulations under section 165 of the Code to clarify the definition of 
the term ``federally declared disaster'' is June 11, 2021.

Special Analyses

    Certain IRS regulations, including these, are exempt from the 
requirements of Executive Order 12866, as supplemented and affirmed by 
Executive Order 13563. Therefore, a regulatory assessment is not 
required.
    Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it 
is hereby certified that these regulations will not have a significant 
economic impact on a substantial number of small entities. The 
regulations clarify how the Secretary may postpone certain time-
sensitive tax deadlines by reason of a federally declared disaster. 
Such postponements provide more time for affected taxpayers to complete 
time-sensitive acts than they otherwise would have under the internal 
revenue laws. In addition, the regulations do not impose a collection 
of information burden on any person, including small entities, for 
purposes of the Regulatory Flexibility Act (5 U.S.C. chapter 6). 
Accordingly, the Secretary certifies that the regulations will not have 
a significant economic impact on a substantial number of small 
entities. Pursuant to section 7805(f) of the Internal Revenue Code, the 
notice of proposed rulemaking preceding these final regulations was 
submitted to the Chief Counsel for Advocacy of the Small Business 
Administration for comments on its impact on small business, and no 
comments were received.

Drafting Information

    The principal authors of these final regulations are Andrew C. 
Keaton and William V. Spatz of the Office of Associate Chief Counsel 
(Procedure and Administration). However, other personnel from the 
Treasury Department and the IRS participated in their development.

List of Subjects

26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

26 CFR Part 301

    Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income 
taxes, Penalties, Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

    Accordingly, 26 CFR parts 1 and 301 are 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 1.165-11 is amended by revising paragraphs (b)(1) and 
(h) to read as follows:


Sec.  1.165-11  Election to take disaster loss deduction for preceding 
year.

* * * * *
    (b) * * *
    (1) A federally declared disaster means any disaster subsequently 
determined by the President of the United States to warrant assistance 
by the Federal Government under the Robert T. Stafford Disaster Relief 
and Emergency Assistance Act (Stafford Act). A federally declared 
disaster includes both a major disaster declared under section 401 of 
the Stafford Act and an emergency declared under section 501 of the 
Stafford Act.
* * * * *
    (h) Applicability dates--(1) In general. Except as provided in 
paragraph (h)(2) of this section, this section applies to elections and 
revocations that are made on or after October 16, 2019.
    (2) Paragraph (b)(1) of this section. The second sentence of 
paragraph (b)(1) of this section applies to elections and revocations 
that are made on or after June 11, 2021.

PART 301--PROCEDURE AND ADMINISTRATION

0
Par. 3. The authority citation for part 301 continues to read in part 
as follows:

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


0
Par. 4. Section 301.7508A-1 is amended by revising paragraph (g) and 
adding paragraph (h) to read as follows:


Sec.  301.7508A-1  Postponement of certain tax-related deadlines by 
reasons of a federally declared disaster or terroristic or military 
action.

* * * * *
    (g) Mandatory 60-day postponement--(1) In general. In addition to 
(or concurrent with) the postponement period specified by the Secretary 
in an exercise of the authority under section 7508A(a) to postpone 
time-sensitive acts by reason of a federally declared disaster, 
qualified taxpayers (as defined in section 7508A(d)(2)) are entitled to 
a mandatory 60-day postponement period during which the time to perform 
those time-sensitive acts is disregarded in the same manner as under 
section 7508A(a). The rules of this paragraph (g)(1) apply with respect 
to a postponement period specified by the Secretary under section 
7508A(b), to postpone acts as provided in section 7508A(d)(4). Except 
for the acts set forth in paragraph (g)(2) of this section, section 
7508A(d) does not apply to postpone any acts.
    (2) Acts postponed. The time-sensitive acts that are postponed for 
the mandatory 60-day postponement period are the acts determined to be 
postponed by the Secretary's exercise of authority under section 
7508A(a) or (b). In addition, in the case of any person described in 
section 7508A(b), the time-sensitive acts postponed for the mandatory 
60-day postponement period include those described in section 
7508A(d)(4):
    (i) Making contributions to a qualified retirement plan (within the 
meaning of section 4974(c)) under section 219(f)(3), 404(a)(6), 
404(h)(1)(B), or 404(m)(2);
    (ii) Making distributions under section 408(d)(4);
    (iii) Recharacterizing contributions under section 408A(d)(6); and
    (iv) Making a rollover under section 402(c), 403(a)(4), 403(b)(8), 
or 408(d)(3).
    (3) Calculation of mandatory 60-day postponement period--(i) In 
general. The mandatory 60-day postponement period begins on the 
earliest incident date specified in a disaster declaration for a 
federally declared disaster and ends on the date that is 60 days after 
the latest incident date specified in the disaster declaration. In 
accordance with section 7508A(d)(5), the mandatory 60-day postponement 
period under section 7508A(d) runs concurrently with the postponement 
period determined by the Secretary in exercising discretion under 
section 7508A(a) or (b) if the period determined by the Secretary is 
equal to or longer than 60 days after the latest incident date. If the 
period determined by the Secretary in exercising discretion under 
section 7508A(a) or (b) ends prior to 60 days after the latest incident 
date, in accordance with section 7508A(d)(5), the mandatory 60-day 
postponement period will run concurrently for the length of the period 
determined by the Secretary under section 7508A(a) or (b) and then 
continue running in addition to the period determined by the Secretary 
under section 7508A(a) or (b).

[[Page 31151]]

    (ii) Limitations on the mandatory 60-day postponement period. (A) 
In no event will the mandatory 60-day postponement period be calculated 
to exceed one year.
    (B) In the event the Secretary determines to postpone time-
sensitive acts pursuant to a declaration establishing a federally 
declared disaster for purposes of section 7508A that does not specify 
an incident date, there is no mandatory postponement period under 
section 7508A(d). In such cases, the only postponement period will be 
the period determined by the Secretary under section 7508A(a) or (b).
    (4) Examples. The rules of this paragraph (g) are illustrated by 
the following examples:
    (i) Example (1). Individual A lives in a state that experienced 
severe but isolated tornado damage on March 15. On March 20, FEMA 
issued a Federal Register Notice announcing a major disaster 
declaration approved by the President for the state where Individual A 
lives, describing the incident date for the tornado as March 15. Based 
upon that major disaster declaration, the IRS published a news release 
identifying the taxpayers (by county) affected by the disaster for 
purposes of section 7508A and specifying the time-sensitive acts that 
are postponed and a period of postponement from March 15 through July 
31, pursuant to section 7508A(a). The county where Individual A lives 
was included in the news release. Under section 7508A(d), the mandatory 
60-day postponement period that Individual A is entitled to begins on 
March 15 and ends 60 days after March 15, on May 14. The mandatory 
postponement period applies to the same time-sensitive acts and runs 
concurrently with the relief the IRS provided to Individual A under 
section 7508A(a).
    (ii) Example (2). Individual B lives in a coastal state which 
experienced harmful effects from a hurricane that began to affect the 
weather in his state on August 15 and ceased to be a weather factor in 
his state on August 19. On August 22, FEMA issued a Federal Register 
Notice announcing a major disaster declaration approved by the 
President, determining that the coastline counties in the state, 
including the county where Individual B lives, were severely affected 
and that these counties were entitled to both individual assistance and 
public assistance. The major disaster declaration specified the 
earliest incident date for the hurricane in the state where Individual 
B lives as August 15 and the latest incident date as August 19. Based 
upon that major disaster declaration, the IRS published a news release 
identifying the taxpayers affected by the disaster for purposes of 
section 7508A and specifying the time-sensitive acts that are postponed 
and a period of postponement from August 15 through December 31, 
pursuant to section 7508A(a). Under section 7508A(d), the mandatory 60-
day postponement period that Individual B is entitled to begins on 
August 15 and ends 60 days after August 19, on October 18. The 
mandatory postponement period applies to the same time-sensitive acts 
and runs concurrently with the relief the IRS provided to Individual B 
under section 7508A(a).
    (iii) Example (3). Individual C lives in a county of a state that 
is experiencing ongoing wildfires. On August 14, FEMA issued a Federal 
Register Notice announcing an emergency declaration approved by the 
President to make public assistance available under the Stafford Act to 
local governments to fight the wildfires. This declaration specified an 
earliest incident date of August 14 and no latest incident date. On 
August 17, FEMA issued a Federal Register Notice announcing a major 
disaster declaration approved by the President for the same wildfires 
incident, announcing that the residents of the county where Individual 
C lives were eligible to receive individual assistance under the 
Stafford Act. This declaration specified August 15 as the earliest 
incident date and described the incident period as ongoing. Based upon 
that major disaster declaration, the IRS exercised its discretion under 
section 7508A(a) to publish a news release identifying the taxpayers 
(by county) affected by the wildfires disaster for purposes of section 
7508A and specifying both the time-sensitive acts that are postponed 
and a period of postponement from August 15 through December 15. 
Following the initial news release, the wildfires disaster remained 
ongoing, with no ending incident date specified, for several months. 
The IRS published a second news release postponing the time-sensitive 
acts through January 15. FEMA subsequently amended the major disaster 
declaration to specify the latest incident date of November 19. Because 
the IRS acted in its discretion to provide relief in response to the 
major disaster declaration, and not to provide relief in response to 
the emergency declaration, the mandatory 60-day postponement period 
that Individual C is entitled to under section 7508A(d) begins on 
August 15, the earliest incident date specified in the major disaster 
declaration, and ends 60 days after the latest incident date of 
November 19. The mandatory postponement period applies to the same 
time-sensitive acts and runs concurrently with the relief the IRS 
provided to Individual C under section 7508A(a), and ends on January 
18, which is 60 days after the latest incident date and three days 
beyond the postponement period specified by the IRS under section 
7508A(a) in its news release.
    (iv) Example (4). Individual D lives in the United States, which is 
experiencing a nationwide emergency as a result of its residents being 
exposed to a highly infectious and dangerous pandemic disease. On March 
13, the President declared a nationwide emergency under section 501(b) 
of the Stafford Act. The pandemic became a federally declared disaster 
for purposes of section 7508A on March 13, however, no incident date 
was specified in the President's emergency declaration. Pursuant to the 
President's March 13 emergency declaration, the IRS published several 
notices identifying the taxpayers affected by the disaster for purposes 
of section 7508A and specifying the time-sensitive acts that are 
postponed and a period of postponement that generally ran from April 1 
through July 15, pursuant to section 7508A(a). Because, in this 
circumstance, the emergency declaration pursuant to which the notices 
were published did not specify an incident date, there is no mandatory 
postponement period under section 7508A(d). The only postponement 
period is the period determined by the Secretary pursuant to the 
discretionary authority under section 7508A(a).
    (h) Applicability dates--(1) In general. Except as provided in 
paragraph (h)(2) of this section, this section applies to disasters 
declared after January 15, 2009.
    (2) Paragraph (g) of this section. Paragraph (g) of this section 
applies to disasters declared on or after December 21, 2019.

Douglas W. O'Donnell,
Deputy Commissioner for Services and Enforcement.
    Approved: May 25, 2021.
Mark J. Mazur,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2021-12311 Filed 6-10-21; 8:45 am]
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