Bulletin No. 2013-7February 11, 2013

HIGHLIGHTSOF THIS ISSUEThese synopses are intended only as aids to the reader inidentifying the subject matter covered. They may not berelied upon as authoritative interpretations.

INCOME TAX

REG–148873–09, page 494.Proposed regulations under section 6109 of the Code createa new taxpayer identifying number known as an IRS truncatedtaxpayer identification number, a TTIN. Notice 2011–38 obso-leted. A public hearing is scheduled for March 12, 2013.

Rev. Proc. 2013–16, page 488.This procedure provides guidance to mortgage loan holders,loan servicers, and borrowers who are participating in the De-partment of the Treasury’s (Treasury) and Department of Hous-ing and Urban Development’s (HUD) Home Affordable Modifica-tion Program (HAMP).

EMPLOYMENT TAX

Notice 2013–8, page 486.This notice provides a special administrative procedure that al-lows employers that treated transit benefits in excess of $125per month per employee as wages in 2012 and have not yetfiled their fourth quarter Form 941 for 2012 to make the nec-essary corrections on their fourth quarter Form 941.

ADMINISTRATIVE

REG–148873–09, page 494.Proposed regulations under section 6109 of the Code createa new taxpayer identifying number known as an IRS truncatedtaxpayer identification number, a TTIN. Notice 2011–38 obso-leted. A public hearing is scheduled for March 12, 2013.

Notice 2013–3, page 484.This notice sets forth the maximum face amount of QualifiedZone Academy Bonds (“Bond” or “Bonds”) that may be issuedfor each State for the calendar years 2012 and 2013. Forthis purpose, “State” includes the District of Columbia and thepossessions of the United States.

Rev. Proc. 2013–16, page 488.This procedure provides guidance to mortgage loan holders,loan servicers, and borrowers who are participating in the De-partment of the Treasury’s (Treasury) and Department of Hous-ing and Urban Development’s (HUD) Home Affordable Modifica-tion Program (HAMP).

Actions Relating to Court Decisions is on the page following the Introduction.Finding Lists begin on page ii.

The IRS MissionProvide America’s taxpayers top-quality service by helpingthem understand and meet their tax responsibilities and en-

force the law with integrity and fairness to all.

IntroductionThe Internal Revenue Bulletin is the authoritative instrument ofthe Commissioner of Internal Revenue for announcing officialrulings and procedures of the Internal Revenue Service and forpublishing Treasury Decisions, Executive Orders, Tax Conven-tions, legislation, court decisions, and other items of generalinterest. It is published weekly and may be obtained from theSuperintendent of Documents on a subscription basis. Bulletincontents are compiled semiannually into Cumulative Bulletins,which are sold on a single-copy basis.

It is the policy of the Service to publish in the Bulletin all sub-stantive rulings necessary to promote a uniform application ofthe tax laws, including all rulings that supersede, revoke, mod-ify, or amend any of those previously published in the Bulletin.All published rulings apply retroactively unless otherwise indi-cated. Procedures relating solely to matters of internal man-agement are not published; however, statements of internalpractices and procedures that affect the rights and duties oftaxpayers are published.

Revenue rulings represent the conclusions of the Service on theapplication of the law to the pivotal facts stated in the revenueruling. In those based on positions taken in rulings to taxpayersor technical advice to Service field offices, identifying detailsand information of a confidential nature are deleted to preventunwarranted invasions of privacy and to comply with statutoryrequirements.

Rulings and procedures reported in the Bulletin do not have theforce and effect of Treasury Department Regulations, but theymay be used as precedents. Unpublished rulings will not berelied on, used, or cited as precedents by Service personnel inthe disposition of other cases. In applying published rulings andprocedures, the effect of subsequent legislation, regulations,

court decisions, rulings, and procedures must be considered,and Service personnel and others concerned are cautionedagainst reaching the same conclusions in other cases unlessthe facts and circumstances are substantially the same.

The Bulletin is divided into four parts as follows:

Part I.—1986 Code.This part includes rulings and decisions based on provisions ofthe Internal Revenue Code of 1986.

Part II.—Treaties and Tax Legislation.This part is divided into two subparts as follows: Subpart A,Tax Conventions and Other Related Items, and Subpart B, Leg-islation and Related Committee Reports.

Part III.—Administrative, Procedural, and Miscellaneous.To the extent practicable, pertinent cross references to thesesubjects are contained in the other Parts and Subparts. Alsoincluded in this part are Bank Secrecy Act Administrative Rul-ings. Bank Secrecy Act Administrative Rulings are issued bythe Department of the Treasury’s Office of the Assistant Secre-tary (Enforcement).

Part IV.—Items of General Interest.This part includes notices of proposed rulemakings, disbar-ment and suspension lists, and announcements.

The last Bulletin for each month includes a cumulative indexfor the matters published during the preceding months. Thesemonthly indexes are cumulated on a semiannual basis, and arepublished in the last Bulletin of each semiannual period.

The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.

For sale by the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402.

February 11, 2013 2013–7 I.R.B.

Actions Relating to Decisions of the Tax CourtIt is the policy of the Internal Rev-

enue Service to announce at an early datewhether it will follow the holdings in cer-tain cases. An Action on Decision is thedocument making such an announcement.An Action on Decision will be issued atthe discretion of the Service only on unap-pealed issues decided adverse to the gov-ernment. Generally, an Action on Decisionis issued where its guidance would be help-ful to Service personnel working with thesame or similar issues. Unlike a TreasuryRegulation or a Revenue Ruling, an Actionon Decision is not an affirmative statementof Service position. It is not intended toserve as public guidance and may not becited as precedent.

Actions on Decisions shall be reliedupon within the Service only as conclu-sions applying the law to the facts in theparticular case at the time the Action onDecision was issued. Caution should beexercised in extending the recommenda-tion of the Action on Decision to similarcases where the facts are different. More-over, the recommendation in the Action onDecision may be superseded by new legis-lation, regulations, rulings, cases, or Ac-tions on Decisions.

Prior to 1991, the Service publishedacquiescence or nonacquiescence only incertain regular Tax Court opinions. TheService has expanded its acquiescenceprogram to include other civil tax caseswhere guidance is determined to be help-ful. Accordingly, the Service now mayacquiesce or nonacquiesce in the holdingsof memorandum Tax Court opinions, aswell as those of the United States DistrictCourts, Claims Court, and Circuit Courtsof Appeal. Regardless of the court decid-ing the case, the recommendation of anyAction on Decision will be published inthe Internal Revenue Bulletin.

The recommendation in every Actionon Decision will be summarized as ac-quiescence, acquiescence in result only,or nonacquiescence. Both “acquiescence”and “acquiescence in result only” meanthat the Service accepts the holding ofthe court in a case and that the Servicewill follow it in disposing of cases withthe same controlling facts. However, “ac-quiescence” indicates neither approvalnor disapproval of the reasons assignedby the court for its conclusions; whereas,“acquiescence in result only” indicatesdisagreement or concern with some or all

of those reasons. “Nonacquiescence” sig-nifies that, although no further review wassought, the Service does not agree withthe holding of the court and, generally,will not follow the decision in disposingof cases involving other taxpayers. Inreference to an opinion of a circuit courtof appeals, a “nonacquiescence” indicatesthat the Service will not follow the hold-ing on a nationwide basis. However, theService will recognize the precedentialimpact of the opinion on cases arisingwithin the venue of the deciding circuit.

The Actions on Decisions published inthe weekly Internal Revenue Bulletin areconsolidated semiannually and appear inthe first Bulletin for July and the Cumula-tive Bulletin for the first half of the year. Asemiannual consolidation also appears inthe first Bulletin for the following Januaryand in the Cumulative Bulletin for the lasthalf of the year.

The Commissioner does NOT ACQUI-ESCE in the following decision:

Patel v. Commissioner1

138 T.C. No. 23 (June 27, 2012)Docket No. 11694–09

1 Nonacquiescence relating to whether a finding that the state of the law is uncertain at the time of the filing of a return, without a finding regarding whether the taxpayer made reasonableinquiry as to the state of the law, is an appropriate factor in determining whether the taxpayer acted with reasonable cause and in good faith for purposes of avoiding an accuracy-related penalty.

2013–7 I.R.B. February 11, 2013

Part III. Administrative, Procedural, and MiscellaneousQualified Zone Academy BondAllocations for 2012 and 2013

Notice 2013–3

SECTION 1. PURPOSE

This notice sets forth the maximumface amount of Qualified Zone AcademyBonds (“QZABs”) that may be issued foreach State for the calendar years 2012 and2013 under § 54E(c)(2) of the InternalRevenue Code. Under § 54A(e)(3), theterm State includes the District of Co-lumbia and any possession of the UnitedStates.

SECTION 2. BACKGROUND

.01 INTRODUCTION

Section 313 of the Tax Extenders andAlternative Minimum Tax Relief Act of2008, Div. C of Pub. L. No. 110–343,122 Stat. 3765 (2008) (“Act”) added new§ 54E, which provides revised programprovisions for QZABs in lieu of the ex-isting provisions under §1397E, effectivefor obligations issued after October 3,2008. The Act amended § 54A(d)(1) toprovide that the term qualified tax creditbond (“QTCB”) means, in part, a qual-ified zone academy bond which is partof an issue that meets the requirementsof §§ 54A(d)(2), (3), (4), (5), and (6) re-garding expenditures of bond proceeds,information reporting, arbitrage, matu-rity limitations, and prohibitions againstfinancial conflicts of interest. The Actalso amended § 54A(d)(2)(C) to providethat, for purposes of § 54A(d)(2), the term“qualified purpose” for a QZAB meansa purpose specified in § 54E(a)(1), de-scribed below.

The Act added § 54E(c)(1) to providea national zone academy bond limitationauthorization for QZABs of $400 millionfor each of calendar years 2008 and 2009.Section 1522 of Title I of Division B of theAmerican Recovery and Reinvestment Actof 2009, Pub. L. No. 111–5, 123 Stat. 115(2009) (“2009 Act”) amended § 54E(c)(1)to provide an increased national zoneacademy bond limitation authorization forQZABs of $1.4 billion for each of cal-endar years 2009 and 2010. Section 758

of the Tax Relief, Unemployment Insur-ance Reauthorization, and Job CreationAct of 2010, Public L. No. 111–312, 124Stat. 3296 (2010) (“2010 Act”) amended§ 54E(c)(1) to provide an authorizationfor QZABs of $400 million for calendaryear 2011. Section 310 of the Ameri-can Taxpayer Relief Act of 2012, PublicL. No. 112–240, 126 Stat. 2313 (2012)(“2012 Act”) further amended § 54E(c)(1)to provide authorization for QZABs of$400 million for each of calendar years2012 and 2013. The amendments made by§ 310 of the 2012 Act apply to obligationsissued after December 31, 2011.

.02 QUALIFIED ZONE ACADEMYBOND UNDER § 54E

Section 54E(d) defines “qualified zoneacademy” as any public school (or aca-demic program within a public school)which is established by and operated un-der the supervision of an eligible localeducation agency to provide educationor training below the postsecondary levelprovided: (A) the public school or pro-gram is designed in cooperation withbusiness to enhance the academic curricu-lum, increase graduation and employmentrates and prepare students for college andthe workforce; (B) students will be sub-ject to the same academic standards andassessments as other students educatedby the eligible local education agency;(C) the comprehensive education plan isapproved by the eligible local educationagency; and (D)(i) such public schoolis located in an empowerment zone orenterprise community including such des-ignated after October 3, 2008; or (ii) thereis a reasonable expectation (as of the dateof bond issuance) that at least 35 percentof the students will be eligible for freeor reduced cost lunches under the schoollunch program established under the Na-tional School Lunch Act.

Section 54E(a) provides that a “quali-fied zone academy bond” or QZAB meansany bond issued as part of an issue if: (1)100 percent of the available project pro-ceeds of such issue are to be used for aqualified purpose with respect to a quali-fied zone academy established by an eli-gible local education agency; (2) the bondis issued by a State or local government

within the jurisdiction of which such acad-emy is located, and (3) the issuer: (A) des-ignates such bond for purposes of this sec-tion; (B) certifies that it has written assur-ances that the private business contributionrequirement of § 54E(b) will be met; and,(C) certifies that it has the written approvalof the eligible local education agency forsuch bond issuance.

Section 54E(d)(3) provides that a qual-ified purpose with respect to each acad-emy means: (A) rehabilitating or repair-ing the public school facility; (B) provid-ing equipment; (C) developing course ma-terials; and, (D) training teachers and otherschool personnel. The private businesscontribution requirement of § 54E(b) ismet if the eligible local education agencythat established the qualified zone acad-emy has written commitments from pri-vate entities to make qualified contribu-tions having a present value (as of the dateof issuance of the issue) of not less than10 percent of the proceeds of the issue.Section 54E(d)(4) defines “qualified con-tributions” as any contribution (of a typeand quality acceptable to the eligible lo-cal education agency) of: (A) equipmentfor use in the qualified zone academy (in-cluding state-of-the-art technology and vo-cational equipment); (B) technical assis-tance in developing curriculum or in train-ing teachers to promote appropriate marketdriven technology in the classroom; (C)employees’ services as volunteer mentors;(D) internships, field trips, or other educa-tional opportunities outside the academy;or (E) any other property or service speci-fied by the eligible education agency. Sec-tion 54E(d)(2) defines “eligible local ed-ucation agency” as any local educationalagency as defined in § 9101 of the Elemen-tary and Secondary Education Act of 1965.

Section 54E(c)(2) provides that theDepartment of the Treasury shall allocatethe national zone academy bond limitationamong the States on the basis of their re-spective populations of individuals belowthe poverty line (as defined by the Officeof Management and Budget). The limi-tation amount allocated to a State underthe preceding sentence shall be allocatedby the State education agency to qualifiedzone academies within such State.

2013–7 I.R.B. 484 February 11, 2013

Under § 54E(c)(3), the maximum ag-gregate face amount of bonds issuedduring any calendar year which may bedesignated as QZABs with respect to anyqualified zone academy shall not exceedthe limitation amount allocated to suchacademy for such calendar year. However,under § 54E(c)(4)(A), if for any calendaryear the limitation amount for any Stateexceeds the amount of bonds issued duringsuch year which are designated QZABswith respect to qualified zone academieswithin such State, the limitation amountfor such State for the following calendaryear shall be increased by the amount

of such excess. Under § 54E(c)(4)(B),however, any carryforward of a limitationamount may be carried only to the first2 years following the unused limitationyear. For these purposes, the limitationamount shall be treated as used on a first-infirst-out basis.

Sections 1.1397E–1 (the “Final Regu-lations”) sets forth regulations that wereissued under § 1397E. For other guid-ance concerning the applicability of theregulations issued under § 1397E, thecredit rate, and the sinking fund yieldsee § 1.397E–1(m), and Notice 2009–15,2009–6 I.R.B. 449, Notice 2009–30,

2009–16 I.R.B. 852, Notice 2010–22,2010–10 I.R.B. 435, and Rev. Proc.2011–19, 2011–6 I.R.B. 465.

SECTION 3. QUALIFIED ZONEACADEMY BOND ALLOCATIONS(in dollars) BY STATE ORTERRITORY, 2012 AND 2013

The national limitation for QZABs is-sued under § 54E for each of calendaryears 2012 and 2013 is $400 million.These amounts are allocated among theStates as follows:

Qualified Zone Academy Bond Allocations by State or Territory, 2012 and 2013

State or Territory 2012 2013

Alabama $7,131,000 $7,131,000Alaska $605,000 $605,000Arizona $9,560,000 $9,560,000Arkansas $4,377,000 $4,377,000California $48,715,000 $48,715,000Colorado $5,326,000 $5,326,000Connecticut $2,970,500 $2,970,500Delaware $885,000 $885,000DC $891,000 $891,000Florida $25,291,000 $25,291,000Georgia $14,616,000 $14,616,000Hawaii $1,286,000 $1,286,000Idaho $2,039,000 $2,039,000Illinois $14,893,000 $14,893,000Indiana $7,966,000 $7,966,000Iowa $2,994,500 $2,994,500Kansas $3,055,000 $3,055,000Kentucky $6,444,000 $6,444,000Louisiana $7,244,000 $7,244,000Maine $1,462,000 $1,462,000Maryland $4,625,000 $4,625,000Massachusetts $5,893,000 $5,893,000Michigan $13,430,000 $13,430,000Minnesota $4,911,000 $4,911,000Mississippi $5,238,000 $5,238,000Missouri $7,338,000 $7,338,000Montana $1,179,000 $1,179,000Nebraska $1,830,000 $1,830,000Nevada $3,368,000 $3,368,000New Hampshire $914,000 $914,000New Jersey $7,145,000 $7,145,000New Mexico $3,401,000 $3,401,000New York $24,219,000 $24,219,000North Carolina $13,318,000 $13,318,000North Dakota $630,000 $630,000Ohio $14,611,000 $14,611,000Oklahoma $5,062,000 $5,062,000Oregon $5,214,000 $5,214,000Pennsylvania $13,449,000 $13,449,000Rhode Island $1,178,000 $1,178,000South Carolina $6,788,000 $6,788,000South Dakota $893,000 $893,000

February 11, 2013 485 2013–7 I.R.B.

Qualified Zone Academy Bond Allocations by State or Territory, 2012 and 2013

State or Territory 2012 2013

Tennessee $9,137,000 $9,137,000Texas $36,825,000 $36,825,000Utah $3,003,000 $3,003,000Vermont $568,000 $568,000Virginia $7,264,000 $7,264,000Washington $7,413,000 $7,413,000West Virginia $2,679,000 $2,679,000Wisconsin $5,794,000 $5,794,000Wyoming $500,000 $500,000

American Samoa $323,000 $323,000Guam $330,000 $330,000Northern Mariana Islands $177,000 $177,000Puerto Rico $13,318,000 $13,318,000Virgin Islands $284,000 $284,000

Total Allocation $400,000,000 $400,000,000

SECTION 4. EFFECTIVE DATE OFNATIONAL ZONE ACADEMY BONDLIMITATIONS

The national limitation allocated in sec-tion 3 for calendar year 2012 is effectivefor QZABs issued on or after January 1,2012, and the national limitation allocatedin section 3 for calendar year 2013 iseffective for QZABs issued on or afterJanuary 1, 2013.

SECTION 5. DRAFTINGINFORMATION

The principal authors of this notice areTimothy L. Jones and David E. Whiteof the Office of Associate Chief Counsel(Financial Institutions and Products).For further information regarding thisnotice, contact David E. White orTimothy L. Jones at (202) 622–3980 (nota toll-free call).

Application of RetroactiveIncrease in Excludible TransitBenefits

Notice 2013–8

PURPOSE

This notice provides guidance withrespect to issues related to the enactmentof section 203 of the American TaxpayerRelief Act (ATRA), Pub. L. 112–240, 126

STAT. 2313, which increased the monthlytransit benefit exclusion under section132(f)(2)(A) of the Internal Revenue Codefrom $125 per participating employee to$240 per participating employee for theperiod of January 1, 2012 through De-cember 31, 2012. To address employers’questions regarding the retroactive appli-cation of the increased exclusion for 2012and to reduce filing and reporting burdens,the Internal Revenue Service (Service)is clarifying how the increase applies for2012 and providing a special adminis-trative procedure for employers to use infiling Form 941, Employer’s QUARTERLYFederal Tax Return, for the fourth quarterof 2012 to reflect changes in the exclud-able amount for transit benefits providedin all quarters of 2012, and in filing FormsW–2, Wage and Tax Statement.

BACKGROUND

Section 132(a)(5) provides that anyfringe benefit that is a qualified transporta-tion fringe is excluded from gross income.Section 132(f)(1) provides in relevantpart that the term “qualified transportationfringe” includes (when provided by an em-ployer to an employee): (1) transportationin a commuter highway vehicle betweenhome and work, (2) any transit pass, or (3)qualified parking.

Section 132(f)(2) provides that theamount of fringe benefits which are pro-vided by an employer to any employeeand which may be excluded from grossincome under section 132(a)(5) shall not

exceed $100 per month in the case of theaggregate of transportation in a commuterhighway vehicle and any transit pass, and$175 in the case of qualified parking.These amounts are adjusted annually forinflation under section 132(f)(6). Prior toenactment of ATRA, the adjusted maxi-mum monthly excludable amount for 2012for the aggregate of transportation in acommuter highway vehicle and any transitpass was $125 and the adjusted maximummonthly excludable amount for qualifiedparking was $240. Section 3.12 of Rev.Proc. 2011–52, 2011–45 I.R.B. 701, priorto amendment by section 3 of Rev. Proc.2013–15 (released January 11, 2013).

ATRA amended section 132(f)(2) to in-crease the maximum monthly excludableamount for employer-provided commuterhighway vehicle transportation and transitpass benefits to an amount equal to themaximum monthly excludable amountfor qualified parking. The amendmentis effective retroactively beginning onJanuary 1, 2012, and extending throughDecember 31, 2013. Rev. Proc. 2013–15clarifies that the maximum monthlyexcludable amount for employer-providedcommuter highway vehicle transportationand transit pass benefits for 2012 is $240.(Rev. Proc. 2013–15 also specifies thatthe maximum monthly excludable amountfor 2013 is $245.)

Amounts which are excluded fromgross income under section 132 are alsoexcluded from Federal Insurance Contri-butions Act (FICA) taxes (both social se-curity and Medicare) and Federal income

2013–7 I.R.B. 486 February 11, 2013

tax withholding. Sections 3121(a)(20) and3401(a)(19).

Generally, corrections of overpaymentsof FICA tax are made after an error hasbeen ascertained using the adjustmentprocess under section 6413 or using therefund claim process under section 6402.An error is ascertained when the employerhas sufficient knowledge of the error to beable to correct it.

Under section 31.6413(a)–1(a) and sec-tion 31.6413(a)–2(b) of the EmploymentTax Regulations, before making an adjust-ment of an overpayment of FICA tax, anemployer generally must repay or reim-burse its employee in the amount of theovercollection prior to the expiration ofthe period of limitations on credit or re-fund, and, for FICA tax overcollected in aprior year, must also secure the employee’swritten statement confirming that the em-ployee has not made any previous claims(or the claims were rejected) and will notmake any future claims for refund or creditof the amount of the overcollected FICAtax. An employer repays the employeeby direct payment to the employee; anemployer reimburses an employee by ap-plying the amount of the overcollectionagainst the employee FICA tax which at-taches to wages paid by the employer to theemployee. Section 31.6413(a)–1(b) pro-vides that employers cannot adjust over-payments of withheld income tax after theend of the calendar year.

Section 31.6402(a)–2 provides rulesunder which a refund claim for an overpay-ment of FICA tax may be made. Pursuantto § 31.6402(a)–2(a), an employer has aduty to assure that its employee’s rights torecover overcollected taxes are protectedby repaying or reimbursing overcollectedamounts. Alternatively, an employer mayobtain the employee’s consent to the filingof the refund claim. Under section 6414and § 31.6414–1, no refund to the em-ployer is allowed for the overpayment ofwithheld income tax which the employerdeducted or withheld from an employee.

To make employment tax correctionsfor overpayments (that is, to make adjust-ments or to claim refunds), an employeruses the “X” form that corresponds to thereturn being corrected. Thus, an employercorrects overreported taxes on a previouslyfiled Form 941 by filing Form 941-X, Ad-justed Employer’s QUARTERLY FederalTax Return or Claim for Refund. A sep-

arate “X” form must be filed for each tax-able period.

EMPLOYERS WHO PROVIDEDTRANSIT BENEFITS IN EXCESS OF$125 PER MONTH AND LESS THANOR EQUAL TO $240 PER MONTH IN2012

For purposes of the remaining discus-sion, “transit benefits” refers to the aggre-gate benefit of transportation in a com-muter highway vehicle and transit passes.Pursuant to the change made by ATRA,which was retroactive to January 1, 2012,any transit benefits provided by an em-ployer to an employee in excess of $125(the former maximum monthly excludableamount) up to $240 (the amended maxi-mum monthly excludable amount) is ex-cluded from the employee’s gross incomeand wages. These excess amounts are re-ferred to as “excess transit benefits” in thisnotice. The exclusion applies whether theemployer provided the transit benefits outof its own funds or whether the transit ben-efits were provided through salary reduc-tion arrangements as permitted by section132(f)(4) and § 1.132–9, Q/A 11 of the In-come Tax Regulations.

SPECIAL ADMINISTRATIVEPROCEDURE FOR EMPLOYERS WHODESIRE TO MAKE ADJUSTMENTSFOR 2012 ON THE FORM 941 FILEDFOR THE FOURTH QUARTER OF 2012

Employers, who originally reported ex-cess transit benefits as includible in grossincome and wages, and withheld incometaxes and FICA taxes, would normally berequired to file Form 941-X for each quar-ter to correct the error.

Due to the timing of the statutorychange and the due dates for Forms 941for the fourth quarter of 2012 and FormsW–2, and in order to reduce administrativeburden, the Service is providing a specialadministrative procedure for employersthat treated excess transit benefits as wagesand that have not yet filed their fourthquarter Form 941 for 2012. Employerswho desire to use this special administra-tive procedure must repay or reimbursetheir employees the overcollected FICAtax on the excess transit benefits for allfour quarters of 2012 on or before filingthe fourth quarter Form 941. The em-ployer, in reporting amounts on its fourth

quarter Form 941, may reduce the fourthquarter Wages, tips and compensation re-ported on line 2, Taxable social securitywages reported on line 5a, and Medicarewages and tips reported on line 5c, by theexcess transit benefits for all four quartersof 2012. By taking advantage of this spe-cial administrative procedure, employerswill avoid having to file Forms 941-X, andwill also avoid having to file Forms W–2cas discussed below.

This procedure can only be used to theextent that employers have repaid or reim-bursed their employees for the employeeshare of FICA tax attributable to the excesstransit benefits. Under this special admin-istrative procedure, employers may onlycorrect the employer share of FICA taxthat corresponds to the employees’ shareof FICA tax that has been repaid or reim-bursed to the employees. Employers usingthis special procedure do not need to ob-tain written statements from their employ-ees confirming, for each employee, that theemployee did not make a claim (or if theemployee did make a claim, the claim wasrejected) and will not make a claim for re-fund of FICA tax overcollected in a prioryear.

The repayment or reimbursement ofoverwithheld social security tax and thecorresponding reduction for wages re-ported on Form 941, line 5a, Taxable socialsecurity wages, must take into account thatrefunds or credits of social security tax arelimited to the amount paid on that portionof the excess transit benefits that, whenadded to other wages for the year, did notexceed the social security wage base for2012 ($110,100).

The same procedures are available tofilers of other employment tax returns re-porting FICA taxes (e.g., the related Span-ish-language return or return for U.S. pos-sessions) and to filers of employment taxreturns reporting taxes under the RailroadRetirement Tax Act.

EMPLOYER INSTRUCTIONS —FOURTH QUARTER FORM 941 HASBEEN FILED OR THE EMPLOYERHAS NOT REPAID OR REIMBURSEDALL EMPLOYEES

Employers that have filed the fourthquarter Form 941 must use Form 941-Xto make an adjustment or claim a refundfor any quarter in 2012 with regard to the

February 11, 2013 487 2013–7 I.R.B.

overpayment of tax on the excess tran-sit benefits after repaying or reimbursingthe employees or, for refund claims, se-curing consents from its employees. Sim-ilarly, employers that, on or before filingthe fourth quarter Form 941, have not re-paid or reimbursed some or all employ-ees who received excess transit benefits in2012 must use Form 941-X to make an ad-justment or claim for refund with respectto the excess transit benefits provided tothose employees and must follow the nor-mal procedures.

EMPLOYER INSTRUCTIONS —FORM W–2

Employers that have not furnished 2012Forms W–2 to their employees should takeinto account the increased exclusion fortransit benefits in calculating the amountof wages reported in box 1, Wages, tips,other compensation; box 3, Social secu-rity wages; and box 5, Medicare wagesand tips. Employers that have repaid orreimbursed their employees for the over-collected FICA taxes prior to furnishingForm W–2 should reduce the amountsof withheld tax reported in box 4, Socialsecurity tax withheld, and box 6, Medi-care tax withheld, by the amounts of therepayments or reimbursements. In allcases, however, employers must report inbox 2, Federal income tax withheld, theamount of income tax actually withheldduring 2012. The additional income taxwithholding will be applied against thetaxes shown on the employee’s individualincome tax return (Form 1040, U.S. Indi-vidual Income Tax Return).

Employers that repaid or reimbursedtheir employees for the overcollectedFICA taxes after furnishing Forms W–2to their employees but before filing FormsW–2 with the Social Security Administra-tion (SSA), should check the “Void” box atthe top of each incorrect Form W–2 (CopyA). The employer should prepare newForms W–2 with the correct information,and send these new Forms W–2 (Copy A)to the SSA. The employers should write“CORRECTED” on the employees’ newcopies (B, C, and 2), and furnish them tothe employees. See the 2012 Instructionsfor Forms W–2 and W–3.

Employers that have already filed 2012Forms W–2 with SSA will need to fileForms W–2c, Corrected Wage and Tax

Statement, to take into account the in-creased exclusion for transit benefits.

DRAFTING INFORMATION

The principal author of this no-tice is Jean Casey of the Office ofAssociate Chief Counsel (Tax Exempt& Government Entities). For furtherinformation regarding this notice, contactMs. Casey at (202) 622–6040 (not atoll-free call).

CFR 601.105: Examination of returns and claimsfor refund, credit, or abatement; determination ofcorrect tax liability.(Also Part I, §§ 61, 108, 451, 6041, 6050P;1.1001–3.)

Rev. Proc. 2013–16

SECTION 1. PURPOSE

This revenue procedure provides guid-ance to mortgage loan holders, loan ser-vicers, and borrowers who are participat-ing in the Department of the Treasury’s(Treasury) and Department of Hous-ing and Urban Development’s (HUD)Home Affordable Modification Program®

(HAMP®). Under HAMP, a borrower maybe eligible for principal reduction of theoutstanding balance of a qualifying mort-gage pursuant to the program’s PrincipalReduction AlternativeSM (PRA). In appro-priate cases, HAMP has been offering thePRA as part of a HAMP loan modificationsince the last quarter of 2010. Currentplans call for HAMP to continue acceptingnew borrowers through the end of 2013.The Internal Revenue Service (Service) isproviding this guidance to address the taxconsequences for borrowers (HAMP-PRAborrowers) who are participating in thePRA and the reporting obligations forparticipating mortgage loan holders andservicers.

SECTION 2. BACKGROUND—HAMPAND THE HAMP PRINCIPALREDUCTION ALTERNATIVE

.01 To help distressed borrowerslower their monthly mortgage payments,Treasury and HUD established HAMPfor mortgage loans that are not ownedor guaranteed by the Federal NationalMortgage Association (Fannie Mae)

or the Federal Home Loan MortgageCorporation (Freddie Mac). A descrip-tion of the program can be found atwww.makinghomeaffordable.gov.

.02 Under HAMP, a participating loanservicer, acting on behalf of the mortgageloan holder, must consider a sequence ofmodification steps for each eligible bor-rower’s mortgage loan until the borrower’smonthly payment is reduced to a monthlypayment amount determined under theHAMP guidelines. These steps include areduction in the mortgage loan’s interestrate, an extension of the mortgage loan’sterm, and a reduction in the mortgageloan’s principal balance.

.03 In some cases, the unpaid principalbalance of the modified mortgage loan isdivided into (1) an amount that bears statedinterest and that is used to calculate theborrower’s new monthly mortgage pay-ment (the “Non-forbearance Portion”), and(2) a forbearance amount, which does notbear stated interest and on which periodicpayments of stated principal are not re-quired. The stated principal of the forbear-ance amount is due upon the earliest of theborrower’s transfer of the property, payoffof the balance on the Non-forbearance Por-tion of the mortgage loan, or maturity ofthe mortgage loan. However, as noted insection 2.06 of this revenue procedure, aHAMP-PRA borrower sometimes may nothave to pay all or a portion of the forbear-ance amount. (The forbearance amount as-sociated with a HAMP-PRA principal re-duction is called the “PRA ForbearanceAmount.”)

.04 If a mortgage loan is being con-sidered for a HAMP modification andthe amount owed on the mortgage loan isgreater than 115 percent of the value ofthe property, then the servicer must con-sider whether principal reduction underPRA should be used as part of the HAMPmodification.

.05 The first step toward a HAMP mod-ification is a trial period plan, in which theborrower’s monthly mortgage payment isset at a monthly payment amount deter-mined under the HAMP guidelines. Thetrial period plan effective date is the duedate for the first of the reduced paymentsthat are to be made under the trial pe-riod plan. (It is the first day of either thefirst or the second month after the servicertransmits the trial period notice to the bor-rower.) In general, the trial period is three

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months, and, during this period, the bor-rower must satisfy certain conditions be-fore the changes to the terms of the mort-gage loan become permanent (the “TrialPeriod Conditions”). Specifically, depend-ing on the borrower’s trial period paymenthistory, the borrower’s compliance withHAMP and servicer guidelines, and his orher satisfaction of all other Trial PeriodConditions, the borrower will be offered apermanent modification of the terms of themortgage loan, including monthly mort-gage payments that are lower than thoseunder the old mortgage loan. Until the ef-fective date of a permanent modification,the terms of the existing mortgage loancontinue to apply.

.06 After the mortgage loan is perma-nently modified under HAMP, if the mod-ified mortgage loan is in good standingon the first, second, or third annual an-niversary of the trial period plan effec-tive date (the “Three-year Period”), theservicer must reduce the unpaid princi-pal balance of the mortgage loan on therespective anniversary date by one-thirdof the initial PRA Forbearance Amount.(The servicer allocates the entire reduc-tion to the remaining PRA ForbearanceAmount.) In general, if a HAMP-PRAborrower’s mortgage loan is in good stand-ing and if the HAMP-PRA borrower paysin full the Non-forbearance Portion of themortgage loan prior to the reduction ofthe entire PRA Forbearance Amount, theservicer must reduce the remaining out-standing principal balance of the mortgageloan by the remaining PRA ForbearanceAmount.

.07 In connection with every HAMPloan modification, the HAMP programadministrator (acting on behalf of the fed-eral government) provides incentives tothe borrower, the servicer, and the investor(that is, the holder of the mortgage loan).If a HAMP loan modification includesa PRA principal reduction, the HAMPprogram administrator makes additionalincentive payments to the investor. Theseadditional incentives are called “PRAInvestor Incentive Payments” and are gen-erally spread over three years. The sizeof the PRA Investor Incentive Paymentsdepends on the amount of principal re-duced, the loan-to-value ratio at the timeof the HAMP modification, and the loan’spayment history before the modification.The PRA Investor Incentive Payments

range from 18 to 63 percent of the princi-pal amounts reduced. For purposes of thisrevenue procedure, the excess of the initialPRA Forbearance Amount of a mortgageloan over the aggregate PRA Investor In-centive Payments scheduled to be paidwith respect to that loan is called the “PRAAdjusted Forbearance Amount.”

.08 A PRA Investor Incentive Paymentis earned by the investor on each date onwhich the servicer reduces the unpaid prin-cipal balance of the mortgage loan by aportion of the PRA Forbearance Amount(generally, on the first three annual an-niversaries of the trial period plan effectivedate).

.09 If a HAMP-PRA borrower’s earlypayment in full of the Non-forbearancePortion of the mortgage loan acceleratesthe reduction of the remaining PRA For-bearance Amount (described above in sec-tion 2.06 of this revenue procedure), the re-maining PRA Investor Incentive Paymentsfrom the HAMP program administrator arealso accelerated.

.10 If, prior to completion of the Three-year Period, a mortgage loan ceases to bein good standing because of the HAMP-PRA borrower’s payment history, then theremaining PRA Forbearance Amount isnot further reduced and is due when theHAMP-PRA borrower transfers the prop-erty, the HAMP-PRA borrower refinances,or otherwise pays off the Non-forbearancePortion of the mortgage loan, or the mort-gage loan matures.

SECTION 3.BACKGROUND—APPLICABLEPROVISIONS OF LAW

.01 Under § 61 of the Internal Rev-enue Code, except as otherwise providedin subtitle A, gross income means all in-come from whatever source derived, in-cluding income from discharge of indebt-edness. See § 61(a)(12).

.02 Under § 1.1001–3 of the IncomeTax Regulations, if a debt instrument un-dergoes a significant modification, thenthe modification results in an exchange ofthe original debt instrument for the modi-fied debt instrument. In general, an agree-ment to change a term of a debt instrumentis a modification at the time the borrowerand holder enter into the agreement, evenif the change in term is not immediately ef-fective. However, if the change is condi-

tioned on reasonable closing conditions, amodification occurs on the closing date ofthe agreement. See § 1.1001–3(c)(6).

.03 Under § 108(e)(10), in the caseof a debt-for-debt exchange (including adeemed exchange under § 1.1001–3), theborrower is treated as having satisfied theoriginal debt instrument with an amountof money equal to the issue price of thenew debt instrument. If the amount of debtsatisfied in this manner exceeds that issueprice, the borrower realizes discharge ofindebtedness income on the exchange. Seealso § 1.61–12(c).

.04 The issue price of a non-publiclytraded debt instrument issued for non-pub-licly traded property generally reflects theamount of principal that the borrower isrequired to pay to the holder of the in-strument. If a borrower has the abilityto avoid paying certain amounts (includ-ing principal) without violating the termsof the instrument, the payment schedulefor the instrument is generally determinedbased on an assumption that the borrowerwill avoid any requirement to make thosepayments. See, e.g., §§ 1.1272–1(c)(5) and1.1274–2(d).

.05 Under § 108(a), gross incomedoes not include any amount that but for§ 108(a) would be includible in gross in-come by reason of the discharge (in wholeor in part) of a taxpayer’s indebtedness if(1) the indebtedness discharged is quali-fied principal residence indebtedness thatis discharged before January 1, 2014, or(2) the discharge occurs when the taxpayeris insolvent. Section 108(a)(1)(E) and108(a)(1)(B). (Although § 108 containsother exclusions as well, this revenue pro-cedure focuses on these two exclusionsbecause they are the most likely to applyto the greatest number of HAMP-PRAborrowers.)

.06 Under §§ 108(h) and 163(h)(3)(B),qualified principal residence indebtednessis any indebtedness that is incurred by aborrower to buy, build, or substantially im-prove the borrower’s principal residenceand is secured by that residence.

.07 Qualified principal residence in-debtedness also includes a loan securedby the borrower’s principal residence thatrefinances qualified principal residenceindebtedness, but only to the extent of theamount of the refinanced indebtedness.See §§ 108(h) and 163(h)(3)(B)(i).

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.08 The maximum amount of dis-charged indebtedness that a borrower mayexclude from gross income under thequalified principal residence indebtednessexclusion is $2,000,000 ($1,000,000 fora married individual filing a separate re-turn). Under § 108(h)(4), if only part ofthe discharged indebtedness is qualifiedprincipal residence indebtedness, then theexclusion applies only to the amount ofthe discharged indebtedness that exceedsthe amount of the loan (determined im-mediately before the discharge) that is notqualified principal residence indebtedness.

.09 Under § 108(a)(3), the insolvencyexclusion applies to the lesser of theamount of the debt discharged or theamount by which the taxpayer is insolventimmediately before the discharge.

.10 Section 108(d)(3) provides that, forpurposes of the insolvency exclusion, ataxpayer is insolvent to the extent that thetaxpayer’s total liabilities exceed the fairmarket value of all of the taxpayer’s as-sets immediately before the discharge ofindebtedness. Under § 108(a)(2)(C), thequalified principal residence indebtednessexclusion takes precedence over the insol-vency exclusion when both exclusions ap-ply to discharged indebtedness, unless thetaxpayer elects to apply the insolvency ex-clusion.

.11 If an amount is excluded from grossincome as a discharge of qualified princi-pal residence indebtedness, the taxpayermust reduce the basis of the taxpayer’sprincipal residence. See § 108(h)(1). Ifa discharged amount is excluded fromgross income because the taxpayer wasinsolvent when the discharge occurred, thetaxpayer must reduce certain tax attributes(possibly including basis). See § 108(b).For further discussion of income from thedischarge of indebtedness, the qualifiedprincipal residence indebtedness exclu-sion, the insolvency exclusion, and otherexclusions from gross income that mayapply, see Publication 4681, CanceledDebts, Foreclosures, Repossessions, andAbandonments (for Individuals).

.12 Taxpayers who exclude any dis-charged amounts from gross income reportboth the exclusion and the resulting re-duction in basis or other tax attributes onForm 982, Reduction of Tax AttributesDue to Discharge of Indebtedness (andSection 1082 Basis Adjustment). See Form982 instructions and Publication 4681.

This form is to be filed with the tax returnfor the taxable year in which the amountis discharged but is excluded from grossincome.

.13 Governmental payments made toor on behalf of individuals or other per-sons are included within the broad defi-nition of gross income under § 61 unlessan exception applies. See Notice 2003–18,2003–1 C.B. 699, and Rev. Rul. 79–356,1979–2 C.B. 28. However, if disburse-ments are made by a governmental unit toindividuals in the interest of the generalwelfare (that is, are generally based on in-dividual or family need) and the disburse-ments do not represent compensation forservices, then the amounts disbursed areexcluded from the income of the recipient(general welfare exclusion). See Rev. Rul.2005–46, 2005–2 C.B. 120, and Rev. Rul.75–246, 1975–1 C.B. 24.

.14 Under § 451 and § 1.451–1(a), a tax-payer that uses the cash receipts and dis-bursements method of accounting includesincome in gross income when the taxpayeractually or constructively receives the in-come.

.15 Section 6041 requires every per-son engaged in a trade or business (includ-ing the United States and its agencies) to(1) file an information return (Form 1099-MISC, Miscellaneous Income, is used forthis purpose) for each calendar year inwhich the person makes, in the course ofits trade or business, payments to anotherperson of fixed or determinable income ag-gregating $600 or more, and (2) furnisha copy of the information return to thatother person. See § 6041(a) and (d) and§ 1.6041–1(a)(1) and (b).

.16 Section 6050P requires applicableentities (including the United States andits agencies, financial entities, and any or-ganization a significant trade or businessof which is the lending of money) to (1)file an information return (Form 1099-C,Cancellation of Debt, is used for this pur-pose) for each calendar year in which itdischarges indebtedness of another personof $600 or more, and (2) furnish a copy ofthe information return to that other person.See § 6050P(a)-(c) and §§ 1.6050P–1(a)and 1.6050P–2(a) and (d).

.17 Section 6721 imposes penalties withrespect to information returns required tobe filed with the Service. These penal-ties apply in the case of a failure to timelyfile an information return, a failure to in-

clude all required information on the re-turn, or the inclusion of incorrect informa-tion on the return. Section 6724(d)(1) in-cludes Forms 1099-MISC and 1099-C inthe term “information return.”

.18 Section 6722 imposes penaltieswith respect to payee statements requiredto be furnished to payees. These penaltiesapply in the case of a failure to timelyfurnish a payee statement, a failure toinclude all required information on thestatement, or the inclusion of incorrect in-formation on the payee statement. Section6724(d)(2) includes in the term “payeestatement” copies of Forms 1099-MISCand 1099-C that are required to be fur-nished to taxpayers.

SECTION 4. FEDERAL INCOME TAXTREATMENT

.01 Because a HAMP modificationwith a PRA principal reduction is a signif-icant modification, it results in a deemeddebt-for-debt exchange in which theHAMP-PRA borrower satisfies the oldmortgage loan by issuing a new one. See§ 1.1001–3. At the time of the modifi-cation, therefore, under § 108 and thisrevenue procedure, the HAMP-PRA bor-rower realizes discharge of indebtednessincome equal to any excess of the ad-justed issue price of the old mortgage loan(which was satisfied in the deemed ex-change) over the issue price of the new(post-modification) mortgage loan. Seealso § 61(a)(12) and § 1.61–12(c).

.02 A HAMP-PRA borrower has theability to avoid payment of the PRA Ad-justed Forbearance Amount. Because theHAMP-PRA borrower has this ability, thatamount should not be taken into accountin determining the issue price of the newmortgage loan. Because the issue price ofthe new mortgage loan does not include thePRA Adjusted Forbearance Amount, thePRA Adjusted Forbearance Amount con-tributes to the excess of the adjusted issueprice of the old mortgage loan (which wassatisfied in the deemed exchange) over theissue price of the new mortgage loan.

.03 On the other hand, the investor hasnot given up its right to receive the remain-der of the PRA Forbearance Amount, be-cause the HAMP program administrator isexpected to make those payments on theHAMP-PRA borrower’s behalf by makingthe PRA Investor Incentive Payments. Be-

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cause the remainder of the PRA Forbear-ance Amount is payable in this manner,that remainder is included in the issue priceof the new mortgage loan.

.04 The Trial Period Conditions are rea-sonable closing conditions that must besatisfied before the changes to the termsof the mortgage loan become permanent.Therefore, for purposes of § 1.1001–3, thedate of the modification is the date of thepermanent modification.

.05 Unless an exclusion applies, theHAMP-PRA borrower includes in grossincome the discharge of indebtedness in-come described in section 4.01 of thisrevenue procedure for the taxable year inwhich the permanent modification occurs.Under certain conditions, however, sec-tion 6 of this revenue procedure permitsa borrower to report the discharge of in-debtedness under HAMP-PRA over theThree-year Period. The qualified prin-cipal residence indebtedness exclusionunder § 108(a)(1)(E) and the insolvencyexclusion under § 108(a)(1)(B) are twoexclusions that may apply to the discharge.

.06 The PRA Investor Incentive Pay-ment is treated as a payment on the mort-gage loan by the HAMP program admin-istrator on behalf of the HAMP-PRA bor-rower.

.07 To the extent that the HAMP-PRAborrower uses the property as theHAMP-PRA borrower’s principal resi-dence or the property is occupied by theHAMP-PRA borrower’s legal dependent,parent, or grandparent without rent beingcharged or collected, the HAMP-PRAborrower excludes from his or her gross in-come under the general welfare exclusionthe PRA Investor Incentive Payments thatthe HAMP program administrator makesto the investor in the mortgage loan. Thisis consistent with Rev. Rul. 2009–19,2009–28 I.R.B. 111, which addressed thetreatment of Pay-for-Performance SuccessPayments.

.08 To the extent that the HAMP-PRAborrower uses the property as a rentalproperty or holds the property vacantand available for rent, the HAMP-PRAborrower includes PRA Investor Incen-tive Payments in gross income. If theHAMP-PRA borrower uses the cash re-ceipts and disbursements method of ac-counting, then the HAMP-PRA borrowerincludes a PRA Investor Incentive Pay-ment in gross income in the taxable year

in which it is applied as a payment on theHAMP-PRA borrower’s mortgage loan.

.09 As described in section 2.09 of thisrevenue procedure, if a HAMP-PRA bor-rower pays in full the Non-forbearancePortion of the mortgage loan while the loanis in good standing and prior to comple-tion of the Three-year Period, that pay-ment accelerates both the reduction in theremaining PRA Forbearance Amount andthe PRA Investor Incentive Payments fromthe HAMP program administrator. To theextent that the HAMP-PRA borrower isdescribed in section 4.07 of this revenueprocedure, the HAMP-PRA borrower ex-cludes from his or her gross income underthe general welfare exclusion the acceler-ated PRA Investor Incentive Payments. Tothe extent that the HAMP-PRA borroweris described in section 4.08 of this revenueprocedure, the HAMP-PRA borrower in-cludes in income in the year of the accel-eration the remaining amount of the PRAInvestor Incentive Payment.

SECTION 5.INFORMATION-REPORTINGOBLIGATIONS

.01 Under § 6050P, the investor is re-quired to file a Form 1099-C with respectto a borrower who realizes discharge of in-debtedness of $600 or more. A copy of thisform is required to be furnished to the bor-rower.

.02 As stated in sections 4.01 and4.04 of this revenue procedure, theHAMP-PRA discharge of indebtednessis realized at the time of the permanentmodification of the mortgage loan.

.03 An investor is an applicable entitythat is required under § 1.6050P–1 andthis revenue procedure to issue a Form1099-C for discharge of indebtedness. Un-der § 1.6050P–1(b)(2)(F), the permanentmodification of a mortgage loan is an iden-tifiable event. Identifiable events deter-mine when Forms 1099-C have to be is-sued. Thus, the Form 1099-C is issuedfor the calendar year in which the perma-nent mortgage loan modification occurs.This rule under § 1.6050P–1(b)(2)(F) ap-plies even if, under section 6 of this rev-enue procedure, the HAMP-PRA borrowerchooses to treat the HAMP-PRA dischargeas being realized at the times when the un-paid principal balance of the new mortgageloan is reduced.

.04 The investor (or the loan serviceracting on behalf of the investor) reportsthe full amount of the discharge on theForm 1099-C regardless of whether someor all of the amount is excludible fromincome under the qualified principal res-idence indebtedness exclusion, the insol-vency exclusion, or any other exclusionthat may apply. That discharged amountwill generally be the PRA Adjusted For-bearance Amount (which does not includethe amounts expected to be satisfied byPRA Investor Incentive Payments).

.05 To the extent that PRA Investor In-centive Payments are made on behalf ofa HAMP-PRA borrower who is describedin section 4.07 of this revenue procedure,the PRA Investor Incentive Payments areexcluded from the gross income of theHAMP-PRA borrower, and thus they arenot fixed or determinable income to theHAMP-PRA borrower. Under § 6041,these payments are not subject to infor-mation reporting. See Notice 2011–14,2011–11 I.R.B. 544, 546.

.06 To the extent that PRA InvestorIncentive Payments are made on behalf ofa HAMP-PRA borrower who is describedin section 4.08 of this revenue procedure,the PRA Investor Incentive Payments areincludible in gross income as fixed ordeterminable income in the taxable yearrequired by the HAMP-PRA borrower’smethod of accounting. The payment issubject to the information reporting re-quirements of § 6041, as described insection 3.15 of this revenue procedure.Accordingly, the HAMP program ad-ministrator is required to issue a Form1099-MISC reporting the PRA InvestorIncentive Payment.

SECTION 6. HAMP-PRABORROWERS’ REPORTING OFDISCHARGES OF INDEBTEDNESSUNDER HAMP-PRA

.01 In general. The HAMP-PRA pro-gram began in the last quarter of 2010,and since that time there has been uncer-tainty about whether the amount of the dis-charge of indebtedness should be reportedin the year of the permanent modificationor over the Three-year Period (when theunpaid principal balance on the new mort-gage loan is reduced). As a result, someHAMP-PRA borrowers have been report-ing the discharge of indebtedness under

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HAMP-PRA over the Three-year Period.Given the temporary nature of the programand the issuance of this guidance after par-ticipation in the program has begun, in theinterests of equitable and sound tax ad-ministration, HAMP-PRA borrowers mayreport discharges of indebtedness underHAMP-PRA under the rules in this section6. A HAMP-PRA borrower may chooseto report discharges of indebtedness underHAMP-PRA pursuant to the rules in thissection 6 only if the borrower applies thesame borrower option under section 6.02of this revenue procedure consistently tothe taxable year of the permanent modifi-cation and to all subsequent taxable years.Thus, a HAMP-PRA borrower may notchoose a borrower option under section6.02 of this revenue procedure if a statuteof limitations has expired for any of thetaxable years that are necessary for consis-tent application of that option.

.02 HAMP-PRA borrower options.A HAMP-PRA borrower may treat theHAMP-PRA discharge as being realizedin either of the following ways—

(1) One hundred percent of the PRAAdjusted Forbearance Amount at the timeof the permanent modification; or

(2) One third of the PRA Adjusted For-bearance Amount on each of the first threeannual anniversaries of the trial periodplan effective date (described in section2.06 of this revenue procedure), when, asrequired by the terms of the new mort-gage loan, the servicer reduces the unpaidprincipal balance of the new mortgageloan. If some or all of the reduction inthe unpaid principal balance is accelerated(as described in section 2.06 of this rev-enue procedure) because the HAMP-PRAborrower prepays the Non-forbearancePortion of the mortgage loan, then theHAMP-PRA discharge represented by theamount of the reduction that was acceler-ated is treated as being realized at the timeof the accelerated reduction.

.03 HAMP-PRA borrowers who chooseto realize the HAMP-PRA discharge at thetime of the permanent modification.

(1) If a HAMP-PRA borrower choosesto treat the HAMP-PRA discharge as be-ing realized at the time of the permanentmodification, then for the taxable year inwhich the permanent modification occurs,the HAMP-PRA borrower reports on Form982 the amount, if any, of the dischargethat is excluded from gross income and in-

cludes in gross income any remaining dis-charge.

(2) If a HAMP-PRA borrower’s mort-gage loan was permanently modified un-der HAMP in 2010 or 2011, and if the bor-rower was reporting the discharge of in-debtedness using the method described insection 6.02(2) of this revenue procedure,then the borrower may change to report-ing the discharge of indebtedness using themethod described in section 6.02(1) of thisrevenue procedure by filing a 2012 Form982 with the borrower’s timely filed (withextensions) 2012 income tax return. Thissection 6.03(2) applies only if the changeto reporting the discharge using the methoddescribed in section 6.02(1) of this revenueprocedure does not change the borrower’sfederal income tax liability (including anychange in federal income tax liability dueto a change in basis or tax attributes (under§ 108(h)(1) or § 108(b))) for any taxableyear prior to the borrower’s 2012 taxableyear. To make this change, the borrowermust—

(i) Compute the amount of discharge ofindebtedness that would be included in in-come under § 61(a)(12) or excluded fromgross income under § 108, basing the com-putation of the discharge on the facts asof the year of the permanent modification;and

(ii) Report on a 2012 Form 982 the re-duction in basis or tax attributes (under§ 108(h)(1) or § 108(b)) due to the perma-nent modification that the borrower wouldhave reported on the Form 982 for thetaxable year of the permanent modifica-tion, minus any reductions due to the per-manent modification that the borrower ac-tually reported on Forms 982 for taxableyears prior to 2012.

(3) Example. The following example il-lustrates the application of section 6.03(2)of this revenue procedure.

In 2010, B’s basis in B’s principal residencewas $330,000. In 2010, B’s mortgage loan on theprincipal residence is permanently modified underHAMP-PRA. B realized $30,000 of cancellation ofindebtedness from the permanent modification, allof which qualifies for the exclusion from incomefor qualified principal residence indebtedness under§ 108(a)(1)(E). The trial period plan effective datealso fell in 2010.

B’s federal income tax return for 2010 was consis-tent with B’s reporting this discharge of indebtednessusing the method described in section 6.02(2) of thisrevenue procedure. That is, B’s 2010 return did notinclude income from discharge of indebtedness underHAMP-PRA, nor did the return contain a Form 982

reporting exclusion of any such discharge of indebt-edness. The next year, B reported on line 10(b) ofthe 2011 Form 982 that B filed with B’s 2011 federalincome tax return a $10,000 reduction in basis in theprincipal residence.

For 2012, B chooses to change to reporting thedischarge of indebtedness using the method describedin section 6.02(1) of this revenue procedure. Thus, Bfiles a 2012 Form 982 with B’s timely filed (includ-ing extensions) 2012 federal income tax return, andon line 10(b) of that form, B reports a $20,000 basisreduction in the principal residence ($30,000 basis re-duction that B would have excluded from income in2010 using the method described in section 6.02(1)of this revenue procedure, minus the $10,000 basisreduction that B reported on B’s 2011 Form 982).

(4) If a HAMP-PRA borrower reportsthe entire HAMP-PRA discharge usingthe method described in section 6.02(1)of this revenue procedure, and if thatHAMP-PRA borrower’s mortgage loanceases to be in good standing during theThree-year Period as described in section2.10 of this revenue procedure, then someor all of the anticipated reductions in thePRA Adjusted Forbearance Amount willnot take place. Because the amount ofthese anticipated reductions was not in-cluded in determining the issue price ofthe new mortgage loan that, pursuant to§ 1.1001–3, the HAMP-PRA borrower isdeemed to issue in satisfaction of the oldmortgage loan, the issue price of the newmortgage loan was understated. Underthese circumstances, the discharge of in-debtedness income determined as of thedate of the permanent modification willhave been overstated.

(5) The Service will not challenge aHAMP-PRA borrower who is describedin section 6.03(4) of this revenue proce-dure and who takes the following correc-tive measures:

(i) If a HAMP-PRA borrower includedany of the discharge of indebtedness ingross income, the HAMP-PRA borrowermay file an amended return that does notinclude the amount of the discharge of in-debtedness that was previously reportedas gross income but that, because of theHAMP-PRA borrower’s failure to keep thenew mortgage loan in good standing, wasnot ultimately discharged. The amendedreturn should be for the taxable year inwhich the income was included (that is, theyear of the permanent modification), pro-vided the applicable statute of limitationsremains open for that taxable year.

(ii) If the HAMP-PRA borrower didnot include any of the discharge of in-

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debtedness in gross income (that is, if theHAMP-PRA borrower excluded all of it),the HAMP-PRA borrower may file a newForm 982 that the Service will treat as su-perseding the earlier Form 982. The newForm 982 will reflect the revised reduc-tion in basis or in tax attributes (under§ 108(h)(1) or § 108(b)). The new Form982 should be the Form 982 for the year ofthe permanent modification and should befiled with the return for the taxable year inwhich the HAMP-PRA borrower’s mort-gage loan ceased to be in good standing.

.04 HAMP-PRA borrowers who chooseto treat the HAMP-PRA discharge as beingrealized on the dates on which the unpaidprincipal balance of the mortgage loan isreduced.

(1) If a HAMP-PRA borrower choosesto realize the HAMP-PRA discharge at thetimes that the unpaid principal balance onthe new mortgage loan is reduced, insteadof at the time of the permanent modifi-cation, then the HAMP-PRA borrower’sfederal income tax returns for the taxableyear that contains the permanent modi-fication and for the subsequent taxableyears must not treat any of the dischargeas being realized at the time of the perma-nent modification and must treat the entireHAMP-PRA discharge as being realizedin the amounts—and at the times—of thereductions in the unpaid principal balance.Except as described in the last sentence ofthis paragraph, therefore, the income taxreturn for the year of the permanent mod-ification must include no gross incomefrom—nor report on Form 982 an exclu-sion of—any amount of the HAMP-PRAdischarge. Instead, the HAMP-PRA dis-charge is included in gross income (or isreported on Form 982 as excluded fromgross income) in the subsequent years inwhich the unpaid principal balance is re-duced. If the first such reduction occursin the year of the permanent modification,however, then the amount of any suchreduction is reflected as an inclusion orexclusion on the federal income tax returnfor that year.

(2) A HAMP-PRA borrower who hasbeen using the method described in sec-tion 6.02(1) of this revenue procedure may

change to the method described in sec-tion 6.02(2) but must comply with the con-sistency and open-year requirements de-scribed in section 6.01 of this revenue pro-cedure.

SECTION 7. PENALTY RELIEF FOR2012

.01 The Service will not assert penal-ties under § 6721 or § 6722 against aninvestor for failing to timely file and fur-nish a 2012 Form 1099-C as required bysection 5.03 through 5.04 and section 8.02of this revenue procedure with respect todischarge of indebtedness resulting fromHAMP-PRA permanent modificationsthat take place during calendar year 2012if the following requirements are satisfied:

(1) Not later than February 28, 2013, astatement is sent to the HAMP-PRA bor-rower containing the following:

(a) The HAMP-PRA borrower’s name,address, and taxpayer identification num-ber; and

(b) The date and amount of the dis-charge of indebtedness (as described insections 4.01 through 4.04 of this revenueprocedure) that is required to be reportedfor 2012.

(2) Not later than March 28, 2013, astatement is sent to the Service. It mustbe in the form of a single statement thatseparately lists for each HAMP-PRA bor-rower the information specified in section7.01(1) of this revenue procedure. Thestatement should be sent to the Service atthe following address:

Internal Revenue Service CenterStop 6728AUSCAustin, TX 73301

.02 The Service will not assert penaltiesunder § 6721 or § 6722 with respect to anyForms 1099-MISC for 2012 that sections5.06 and 8.02 of this revenue procedurerequire to be filed with the Service andfurnished to taxpayers.

.03 Section 8.03 and 8.04 of this rev-enue procedure, below, describes penaltyrelief regarding Forms 1099-C and 1099-MISC for 2010 and 2011.

SECTION 8. SCOPE AND EFFECTIVEDATE

.01 This revenue procedure appliesto all borrowers, investors, and servicerswho participate, or have participated, inthe HAMP-PRA, regardless of when thepermanent modification occurs.

.02 Section 5 of this revenue procedureis effective for Forms 1099-C and 1099-MISC due or filed after January 24, 2013.

.03 Because of the effective date in sec-tion 8.02 of this revenue procedure, aninvestor is not subject to penalties under§ 6721 or § 6722 on the grounds that theinvestor failed to timely file and furnish a2010 or 2011 Form 1099-C as described insection 5.03 through 5.04 of this revenueprocedure (or on the grounds that the in-vestor filed or furnished a 2010 or 2011Form 1099-C that is inconsistent with sec-tion 5.03 through 5.04 of this revenue pro-cedure), provided that the investor demon-strates a good faith attempt to comply withthe requirements of § 6050P and that thefailure was not due to willful neglect.

.04 Because of the effective date insection 8.02 of this revenue procedure,the Service will not assert penalties un-der § 6721 or § 6722 on the grounds of afailure to timely file and furnish a 2010or 2011 Form 1099-MISC, as described insection 5.06 of this revenue procedure.

SECTION 9. DRAFTINGINFORMATION

The principal authors of this revenueprocedure are Ronald J. Goldstein of theOffice of Chief Counsel (Procedure andAdministration); Shareen S. Pflanz andSheldon A. Iskow of the Office of ChiefCounsel (Income Tax and Accounting);and Andrea M. Hoffenson of the Officeof Chief Counsel (Financial Institutionsand Products). For further informationregarding this revenue procedure, contactProcedure and Administration branch1 at (202) 622–4910, Income Tax andAccounting branch 4 at (202) 622–4920,or Financial Institutions and Productsbranch 1 at (202) 622–3920 (not toll-freecalls).

February 11, 2013 493 2013–7 I.R.B.

Part IV. Items of General InterestNotice of ProposedRulemaking and Notice ofPublic Hearing

IRS Truncated TaxpayerIdentification Numbers

REG–148873–09

AGENCY: Internal Revenue Service(IRS), Treasury.

ACTION: Notice of proposed rulemakingand notice of public hearing.

SUMMARY: This document contains pro-posed regulations that create a new tax-payer identifying number known as an IRStruncated taxpayer identification number,a TTIN. As an alternative to using a so-cial security number (SSN), IRS individualtaxpayer identification number (ITIN), orIRS adoption taxpayer identification num-ber (ATIN), the filer of certain informa-tion returns may use a TTIN on the cor-responding payee statements to identifythe individual being furnished a statement.The TTIN displays only the last four digitsof an individual’s identifying number andis shown in the format XXX–XX–1234or ***–**–1234. These proposed regu-lations affect filers of certain informationreturns who will be permitted to identifyan individual payee by use of a TTIN onthe payee statement furnished to the indi-vidual, and those individuals who receivepayee statements containing a TTIN.

DATES: Written or electronic commentsmust be received by February 21, 2013.Outlines of topics to be discussed at thepublic hearing scheduled for March 12,2013 must be received by February 20,2013.

ADDRESSES: Send submissions to:CC:PA:LPD:PR (REG–148873–09),Room 5203, Internal Revenue Service, POBox 7604, Ben Franklin Station, Wash-ington, DC 20044. Submissions may behand delivered Monday through Fridaybetween the hours of 8 a.m. and 4 p.m.to: CC:PA:LPD:PR (REG–148873–09),Courier’s Desk, Internal Revenue Ser-vice, 1111 Constitution Avenue, NW,

Washington, DC, 20224 or sent elec-tronically, via the Federal eRulemakingPortal at http://www.regulations.gov (IRSREG–148873–09). The public hearingwill be held in the Internal RevenueService Auditorium, Internal RevenueService, 1111 Constitution Avenue, NW,Washington, DC 20224.

FOR FURTHER INFORMATIONCONTACT: Concerning the proposedregulations, Tammie A. Geier, (202)622–3620; concerning submissionsof comments, the public hearing,and/or to be placed on the buildingaccess list to attend the publichearing, Oluwafunmilayo Taylor of thePublications and Regulations Branch at(202) 622–7180 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Background

This document contains proposedamendments to the Income Tax Regula-tions (26 CFR Part 1) and the Procedureand Administration Regulations (26 CFRPart 301). These amendments implementthe pilot program announced in Notice2009–93, 2009–51 I.R.B. 863, extendedand modified in Notice 2011–38, 2011–20I.R.B. 785, which together authorized fil-ers of certain information returns to trun-cate an individual payee’s nine-digit iden-tifying number on specified paper payeestatements furnished for calendar years2009 through 2012. See §601.601(d)(2).

The pilot program was implemented inresponse to concerns about the risk of iden-tity theft stemming from the inclusion ofa taxpayer identifying number on a payeestatement. In particular, the risks of misap-propriation and subsequent misuse of thatnumber were reported to be greatest withrespect to paper payee statements.

I. Information Reporting

Information returns are returns, state-ments, forms, or other documents thatmust be filed with the IRS to report trans-actions (for example, payments, distribu-tions, or transfers) with another personin a calendar year. Section 6724(d)(1);Treas. Reg. §301.6721–1(g)(1). Per-sons required to file information returns

with the IRS are filers. Treas. Reg.§301.6721–1(g)(6). Generally, filers mustfurnish a statement to the person on theother side of the transaction — the payee— containing the information shownon the information return filed with theIRS. See Treas. Reg. §301.6721–1(g)(5)(defining “payee” for purposes of sec-tions 6721 and 6722). The payee may bethe recipient of a payment (as referred toon Copy B of Form 1099-MISC, “Mis-cellaneous Income”), a plan participantreceiving distributions (as referred to onCopy B of Form 1099-R, “Distributionsfrom Pensions, Annuities, Retirement orProfit-Sharing Plans, IRAs, InsuranceContracts, Etc.”), a transferor selling orexchanging real estate (as referred to onCopy B of Form 1099-S, “Proceeds fromReal Estate Transactions”), a payer/bor-rower making interest payments (as re-ferred to on Copy B of Form 1098, “Mort-gage Interest Statement”), a debtor whosedebt was discharged, canceled or forgiven(as referred to on Copy B of Form 1099-C,“Cancellation of Debt”), or a student re-ceiving scholarships, grants or qualifiedtuition (as referred to on Copy B of Form1098-T, “Tuition Statement”). The state-ment furnished to the payee is referred toas a payee statement. Section 6724(d)(2);Treas. Reg. §301.6722–1(d)(2). In certaincircumstances, persons required to file in-formation returns may file substitute formswith the IRS and furnish substitute formstatements to payees rather than use theofficial IRS forms. Rev. Proc. 2011–60.See §601.601(d)(2).

II. Taxpayer Identifying Numbers

Section 6011(a) requires, in part, thatevery person required to make a returnor statement shall include therein theinformation required by forms or regula-tions. Regulations, forms, or instructionsto forms may require that the filer of aninformation return include the identifyingnumber of the payee on the correspondingpayee statement.

Section 6109(a) authorizes the Secre-tary to prescribe regulations with respectto the inclusion in returns, statements, orother documents of an identifying numberas may be prescribed for securing properidentification of a person. A taxpayer

2013–7 I.R.B. 494 February 11, 2013

identifying number is also referred to asa TIN, which section 7701(a)(41) definesas the identifying number assigned to aperson under section 6109.

Section 6109(a)(3) generally providesthat any person required to make a re-turn, statement, or other document with re-spect to another person shall request fromthe other person, and shall include in thereturn, statement, or other document, theidentifying number as may be prescribedfor securing proper identification of theother person. Thus, for information report-ing purposes, a filer of an information re-turn must request a TIN from the payee andinclude the TIN on the information return.

Flush language in section 6109(a)states that the identifying number of anindividual (or the individual’s estate) isthe individual’s social security accountnumber. Section 6109(d) provides that,except as otherwise specified under regu-lations, the social security account numberissued to an individual under the SocialSecurity Act is the identifying numberfor individuals for purposes of the Code.Regulations provide that the principaltypes of taxpayer identifying numbers areSSNs, ITINs, ATINs, and employer iden-tification numbers (EINs). Treas. Reg.§301.6109–1(a)(1)(i). SSNs, ITINs, andATINs are used to identify individuals.Treas. Reg. §301.6109–1(a)(1)(ii). AnEIN is used to identify an individual orother person (whether or not an employer).Treas. Reg. §301.7701–12.

Summary of Comments

Comments received in response to thenotices, and other feedback from the payorcommunity, reflect that filers’ participa-tion in the pilot was positive. Some fil-ers, however, noted a few limitations thatprevented participation. Several commen-tators suggested expanding the pilot pro-gram by recommending that truncation beauthorized on a greater number of payeestatements, that truncation be permitted onelectronically furnished payee statements,and that filers be permitted to truncate anindividual payee’s EIN in addition to theother types of taxpayer identifying num-bers (SSNs, ITINs, and ATINs) includedin the pilot program. A permanent volun-tary program was encouraged, rather thana mandatory program. Other commenta-tors suggested that taxpayers could be ad-

versely affected by the truncation of theiridentifying numbers on payee statementsdue to the inability to identify errors inthe first five masked digits. Also, somestate tax authorities stated that the trun-cation of taxpayer identifying numbers onFederal payee statements that are attachedto state income tax returns might hamperstate income tax processing. The Trea-sury Department and the IRS gave seriousconsideration to the state government con-cerns, but concluded that truncation is un-likely to hamper state income tax returnprocessing significantly because the vastmajority of payee statements attached tostate returns are Forms W–2, which are notsubject to the truncation program, and be-cause payee information is available to thestates through data sharing programs withthe Federal government.

All comments were considered in de-veloping the regulations that, as proposed,create a permanent truncation program.The proposed regulations expand thescope of the pilot program so that fil-ers are permitted to use TTINs on payeestatements furnished by electronic means.With regard to including a greater numberof payee statements, the pilot programand, therefore, the proposed regulationsare limited in scope by statute. For exam-ple, section 6051(a)(2) requires that thewritten statement furnished to employees(Form W–2, “Wage and Tax Statement”)show the name of the employee “and hissocial security account number.” Accord-ingly, these proposed regulations do notexpand the number of payee statementsincluded beyond those included in the pi-lot program.

Some commentators reported that theinability to truncate a payee’s EIN on apayee statement resulted in their inabilityto participate in the pilot program. Asdescribed in the comments, some filerscould not differentiate the type of identi-fying number assigned to a payee and/orcould not differentiate numbers belong-ing to individuals. As explained in thecomments, the affected filers, because ofsoftware limitations, could either truncateall payee identifying numbers, includingEINs (whether assigned to an individual ora corporation, for example), or none at all.The IRS believes the misuse of EINs is lessfrequently an element of identity theft. Asthese regulations are proposed in responseto the risk of identity theft stemming from

the inclusion of an individual’s taxpayeridentifying number on a payee statement,these proposed regulations do not permittruncation for numbers that may be as-signed to taxpayers other than individuals.The IRS seeks further comments regard-ing the number of filers who are unable todifferentiate EINs from payee identifyingnumbers belonging to individuals and thefeasibility of making software changes toaddress this issue.

Some commentators explained thattheir systems could not readily accommo-date truncation (as exemplified above withrespect to EINs) and that filers of infor-mation returns have varying volume andprocedures. Accordingly, participation inthe truncation program proposed by theregulations is voluntary.

Explanation of Provisions

These proposed regulations create andallow filers of certain information returnsto use an IRS truncated taxpayer identifi-cation number, a TTIN, to identify individ-uals on the payee statements correspond-ing to those information returns. The pro-posed regulations provide that the TTINmay be used in lieu of a payee’s SSN,ATIN, or ITIN, but use of a TTIN is notmandatory. A TTIN may be used only on apayee statement and may be used on payeestatements furnished by paper or electronicmeans. A filer may not use a TTIN onan information return filed with the IRS.A filer may not truncate its own identi-fying number on information returns orpayee statements. A filer may not truncatea payee’s EIN under the proposed regula-tions.

The payee statements on which TTINsmay be included are the same statementsincluded in the current pilot program inNotice 2011–38. The current pilot pro-gram includes all statements in the Forms1099, 1098, and 5498 series, with the ex-ception of Form 1098-C, Contributions ofMotor Vehicles, Boats, and Airplanes, be-cause that form is not a payee statement butan “acknowledgement.” Any subsequentchanges to the list will appear in publishedguidance.

These proposed regulations also amendcertain existing regulations under sections6042, 6043, 6044, 6045, 6049, 6050A,6050E, 6050N, 6050P, and 6050S tospecifically authorize the use of TTINs on

February 11, 2013 495 2013–7 I.R.B.

payee statements furnished under thosesections. Those regulations set forth re-quirements for payee statements that couldbe read as inconsistent with the use ofTTINs to identify payees, in some casesrequiring that the payee be furnished acopy of the information return filed withthe IRS. Other information reporting reg-ulations that do not contain provisionscontradictory to the use of TTINs are notbeing updated in these proposed regula-tions.

Many of the regulations governing thefurnishing of payee statements do not pro-vide for the use of substitute statements.These regulations are not being revised toaddress substitute statements at this time.For information regarding substitute state-ments, see Rev. Proc. 2011–60, 2011–52I.R.B. 934 (or its successor), republishedas Publication 1179, “General Rules andSpecifications for Substitute Forms 1096,1098, 1099, 5498, and Certain Other In-formation Returns.” Rev. Proc. 2011–60also contains rules for electronic deliveryof payee statements. Provisions relatingto the use of TTINs in electronically fur-nished payee statements, if any, will be in-cluded in successor revenue procedures toRev. Proc. 2011–60. See §601.601(d)(2).

Proposed Effective and ApplicabilityDates

These regulations are proposed to takeeffect when published in the Federal Reg-ister as final regulations. The rules inthese proposed regulations may be reliedupon by the affected filers before the pub-lication of the Treasury decision.

Effect on Other Documents

The following publication will be obso-lete as of the date this notice of proposedrulemaking is published as final regula-tions in the Federal Register:

Notice 2011–38, 2011–20 I.R.B. 785.

Special Analyses

It has been determined that these reg-ulations are not a significant regulatoryaction as defined in Executive Order12866, as supplemented by ExecutiveOrder 13563. Therefore, a regulatoryassessment is not required. It also hasbeen determined that section 553(b) of theAdministrative Procedure Act (5 U.S.C.

chapter 5) does not apply to these reg-ulations and, because the regulations donot impose a collection of information onsmall entities, the Regulatory FlexibilityAct (5 U.S.C. chapter 6) does not apply.Pursuant to section 7805(f), these regu-lations have been submitted to the ChiefCounsel for Advocacy of the Small Busi-ness Administration for comment on theirimpact on small business.

Comments and Public Hearing

Before these proposed regulations areadopted as final regulations, considerationwill be given to any written (a signed origi-nal and eight (8) copies) or electronic com-ments that are submitted timely to the IRS.The Treasury Department and the IRS re-quest comments on all aspects of the pro-posed regulations. The Treasury Depart-ment and the IRS specifically request com-ments on issues encountered by filers andpayees alike, whether filers should be per-mitted to truncate a payee’s EIN and, if so,why and whether truncation should be per-mitted on additional types of payee state-ments. The Treasury Department and theIRS further request that filers provide de-tails as to whether the exclusion of EINsfrom these regulations prevents them fromusing TTINs at all. All comments submit-ted by the public will be made available forpublic inspection and copying.

A public hearing has been scheduled forMarch 12, 2013 beginning at 10:00 a.m., inthe Internal Revenue Service Auditorium,Internal Revenue Service, 1111 Constitu-tion Avenue, NW, Washington, DC 20224.Due to building security procedures, vis-itors must enter through the ConstitutionAvenue entrance. In addition, all visitorsmust present photo identification to enterthe building. Because of access restric-tions, visitors will not be admitted beyondthe immediate entrance area more than 30minutes before the hearing starts. For in-formation about having your name placedon the building access list to attend thehearing, see the FOR FURTHER INFOR-MATION CONTACT section of this pre-amble.

The rules of 26 CFR 601.601(a)(3) ap-ply to the hearing. Persons who wish topresent oral comments at the hearing mustsubmit written or electronic comments byFebruary 21, 2013 and an outline of thetopics to be discussed and the time to be

devoted to each topic (a signed originaland eight (8) copies) by February 20, 2013.A period of ten minutes will be allottedto each person for making comments. Anagenda showing the scheduling of speak-ers will be prepared after the deadline forreceiving outlines has passed. Copies ofthe agenda will be available free of chargeat the hearing.

Drafting Information

The principal author of these regula-tions is Tammie A. Geier of the Officeof the Associate Chief Counsel (Procedureand Administration).

* * * * *

Proposed Amendments to theRegulations

Accordingly, 26 CFR parts 1 and 301are proposed to be amended as follows:

PART 1—INCOME TAXES

Paragraph 1. The general authority cita-tion for part 1 continues to read as follows:

Authority: 26 U.S.C. 7805 * * *Par. 2. Section 1.6042–4 is amended by

revising paragraph (b) to read as follows:

§1.6042–4 Statements to recipients ofdividend payments.

* * * * *(b) Form and content of the statement.

The statement required by paragraph (a)of this section must be either the officialForm 1099 prescribed by the Internal Rev-enue Service for the respective calendaryear or an acceptable substitute statementthat contains provisions that are substan-tially similar to those of the official Form1099 for the respective calendar year.For further guidance on how to preparean acceptable substitute statement, seeRev. Proc. 2011–60 (or its successor) re-published as Publication 1179, “GeneralRules and Specifications for SubstituteForms 1096, 1098, 1099, 5498, and Cer-tain Other Information Returns.” See§601.601(d)(2) of this chapter. An IRStruncated taxpayer identifying number(TTIN) may be used as the identifyingnumber for an individual recipient. Forprovisions relating to the use of TTINs,see §301.6109–4 of this chapter (Proce-dure and Administration Regulations).

2013–7 I.R.B. 496 February 11, 2013

* * * * *Par. 3. Section 1.6043–4 is amended

by adding two new sentences to the end ofparagraph (b)(4) to read as follows:

§1.6043–4 Information returns relatingto certain acquisitions of control andchanges in capital structure.

* * * * *(b) * * *(4) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the identifying number for an individ-ual shareholder in lieu of the identifyingnumber appearing on the Form 1099-CAPfiled with the Internal Revenue Service.For provisions relating to the use of TTINs,see §301.6109–4 of this chapter (Proce-dure and Administration Regulations).

* * * * *Par. 4. Section 1.6044–5 is amended

by adding two new sentences to the end ofparagraph (b) to read as follows:

§1.6044–5 Statements to recipients ofpatronage dividends.

* * * * *(b) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the identifying number for an individualrecipient in lieu of the identifying numberappearing on the corresponding informa-tion return filed with the Internal RevenueService. For provisions relating to the useof TTINs, see §301.6109–4 of this chap-ter (Procedure and Administration Regula-tions).

* * * * *Par. 5. Section 1.6045–2 is amended

by adding two new sentences to the end ofparagraph (c) to read as follows:

§1.6045–2 Furnishing statement requiredwith respect to certain substitutepayments.

* * * * *(c) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the identifying number for an individualcustomer in lieu of the identifying numberappearing on the information return filedwith the Internal Revenue Service. Forprovisions relating to the use of TTINs,see §301.6109–4 of this chapter (Proce-dure and Administration Regulations).

* * * * *Par. 6. Section 1.6045–3 is amended

by adding two new sentences to the end ofparagraph (e)(1) to read as follows:

§1.6045–3 Information reporting for anacquisition of control or a substantialchange in capital structure.

* * * * *(e) * * *(1) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the identifying number for an individualcustomer. For provisions relating to theuse of TTINs, see §301.6109–4 of thischapter (Procedure and AdministrationRegulations).

* * * * *Par. 7. Section 1.6045–4 is amended

by revising paragraph (m)(1) to read asfollows:

§1.6045–4 Information reporting on realestate transactions with dates of closingon or after January 1, 1991.

* * * * *(m) * * *(1)(i) Requirement of furnishing state-

ments. A reporting person who is requiredto make a return of information under para-graph (a) of this section shall furnish tothe transferor whose TIN is required to beshown on the return a written statement ofthe information required to be shown onsuch return. The written statement mustbear either the legend shown on the recip-ient copy of Form 1099 or the following:This is important tax information and is be-ing furnished to the Internal Revenue Ser-vice. If you are required to file a return, anegligence penalty or other sanction maybe imposed on you if this item is requiredto be reported and the IRS determines thatit has not been reported.

(ii) This requirement may be satisfiedby furnishing to the transferor a copy of acompleted Form 1099 (or substitute Form1099 that complies with current revenueprocedures). An IRS truncated taxpayeridentifying number (TTIN) may be usedas the identifying number for an individualtransferor in lieu of the identifying numberappearing on the information return filedwith the Internal Revenue Service. Forprovisions relating to the use of TTINs,

see §301.6109–4 of this chapter (Proce-dure and Administration Regulations).

(iii) In the case of a real estate transac-tion for which a Uniform Settlement State-ment is used, this requirement also maybe satisfied by furnishing to the transferora copy of a completed statement that ismodified to comply with the requirementsof this paragraph (m), and by designatingon the Uniform Settlement Statement theitems of information (such as gross pro-ceeds or allocated gross proceeds) requiredto be set forth on the Form 1099. For pur-poses of this paragraph (m), a statementshall be considered furnished to a trans-feror if it is given to the transferor in per-son, either at the closing or thereafter, or ismailed to the transferor at the transferor’slast known address.

* * * * *Par. 8. Section 1.6045–5 is amended

by adding two sentences before the lastsentence of paragraph (a)(3)(i) to read asfollows:

§1.6045–5 Information reporting onpayments to attorneys.

(a) * * *(3) * * *(i) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the identifying number for an individualattorney in lieu of the identifying numberappearing on the information return filedwith the Internal Revenue Service. Forprovisions relating to the use of TTINs, see§301.6109–4 of this chapter (Procedureand Administration Regulations). * * *

* * * * *Par. 9. Section 1.6049–6 is amended by

adding paragraph (b)(3) to read as follows:

§1.6049–6 Statements to recipientsof interest payments and holders ofobligations for attributed original issuediscount.

* * * * *(b) * * *(3) With respect to both statements

to persons receiving payments of inter-est and persons holding obligations, thestatement shall include the name, address,and taxpayer identifying number of suchperson. An IRS truncated taxpayer iden-tifying number (TTIN) may be used as

February 11, 2013 497 2013–7 I.R.B.

the identifying number for an individualperson. For provisions relating to the useof TTINs, see §301.6109–4 of this chapter(Procedure and Administration Regula-tions).

* * * * *Par. 10. Section 1.6050A–1 is amended

by adding two sentences to the end of para-graph (c)(1) to read as follows:

§1.6050A–1 Reporting requirements ofcertain fishing boat operators.

* * * * *(c) * * *(1) * * * An IRS truncated taxpayer

identifying number (TTIN) may be used asthe identifying number for the individualin lieu of the identifying number appear-ing on the information return filed withthe Internal Revenue Service. For pro-visions relating to the use of TTINs, see§301.6109–4 of this chapter (Procedureand Administration Regulations).

* * * * *Par. 11. Section 1.6050E–1 is amended

by adding two sentences to the end of para-graph (k)(1) to read as follows:

§1.6050E–1 Reporting of State and localincome tax refunds.

* * * * *(k) * * *(1) * * * An IRS truncated taxpayer

identifying number (TTIN) may be used asthe identifying number for the individualin lieu of the identifying number appear-ing on the information return filed withthe Internal Revenue Service. For pro-visions relating to the use of TTINs, see§301.6109–4 of this chapter (Procedureand Administration Regulations).

* * * * *Par. 12. Section 1.6050N–1 is amended

by adding two sentences to the end of para-graph (b) to read as follows:

§1.6050N–1 Statements to recipients ofroyalties paid after December 31, 1986.

* * * * *(b) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the identifying number for an individualrecipient. For provisions relating to the use

of TTINs, see §301.6109–4 of this chap-ter (Procedure and Administration Regula-tions).

* * * * *Par. 13. Section 1.6050P–1 is amended

by:a. Removing “section;” from paragraph

(f)(1)(i) and adding “section.” in its place;and

b. Adding two sentences to the end ofparagraph (f)(1)(i) to read as follows:

§1.6050P–1 Information reporting fordischarges of indebtedness by certainentities.

* * * * *(f) * * *(1) * * *(i) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the TIN of an individual for whomthere was an identifiable event in lieu ofthe identifying number appearing on theinformation return filed with the InternalRevenue Service. For provisions relatingto the use of TTINs, see §301.6109–4 ofthis chapter (Procedure and Administra-tion Regulations);

* * * * *Par. 14. Section 1.6050S–1 is amended

by:a. Removing “section;” from paragraph

(c)(1)(i) and adding “section.” in its place;and

b. Adding two sentences to the end ofparagraph (c)(1)(i) to read as follows:

§1.6050S–1 Information reporting forqualified tuition and related expenses.

* * * * *(c)* * *(1) * * *(i) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the TIN for the individual in lieu ofthe identifying number appearing on theinformation return filed with the InternalRevenue Service. For provisions relatingto the use of TTINs, see §301.6109–4 ofthis chapter (Procedure and Administra-tion Regulations);

* * * * *Par. 15. Section 1.6050S–3 is amended

by:

a. Removing “section;” from paragraph(d)(1)(i) and adding “section.” in its place;and

b. Adding two sentences to the end ofparagraph (d)(1)(i) to read as follows:

§1.6050S–3 Information reportingfor payments of interest on qualifiededucation loans.

* * * * *(d) * * *(1) * * *(i) * * * An IRS truncated taxpayer

identifying number (TTIN) may be usedas the TIN for the individual payor in lieuof the identifying number appearing on theinformation return filed with the InternalRevenue Service. For provisions relatingto the use of TTINs, see §301.6109–4 ofthis chapter (Procedure and Administra-tion Regulations).

* * * * *

PART 301—PROCEDURE ANDADMINISTRATION

Par. 16. The authority citation for part301 continues to read as follows:

Authority: 26 U.S.C. 7805.Par. 17. Section 301.6109–4 is added

to read as follows:

§301.6109–4 IRS truncated taxpayeridentification numbers.

(a) In general — (1) Definition. AnIRS truncated taxpayer identificationnumber (TTIN) is an individual’s socialsecurity number (SSN), IRS individualtaxpayer identification number (ITIN), orIRS adoption taxpayer identification num-ber (ATIN) that is truncated by replacingthe first five digits of the nine-digit num-ber with Xs or asterisks. The TTIN isshown in the format XXX-XX–1234 or***-**-1234.

(2) Use of a TTIN. (i) A TTIN may beused by a filer of certain information re-turns to identify an individual on the cor-responding payee statement furnished tothe individual, as authorized by regula-tions, forms or form instructions, or otherguidance published by the Internal Rev-enue Service. A TTIN may not be usedon payee statements corresponding to theForm W–2 series, the Form 1098-C (Con-tributions of Motor Vehicles, Boats, and

2013–7 I.R.B. 498 February 11, 2013

Airplanes), or where identification of ataxpayer by an SSN, ITIN, or ATIN ismandated by statute.

(ii) A TTIN cannot be used by a fileron any information return filed with theInternal Revenue Service.

(iii) A TTIN may only be used for iden-tifying individuals assigned SSNs, ITINs,or ATINs.

(iv) A filer may not truncate its owntaxpayer identifying number on any doc-ument.

(v) Use of a TTIN is permissive and notmandatory.

(b) Definitions — (1) Filer. A filermeans a person who is required to reporta transaction to the Internal Revenue Ser-vice on an information return.

(2) Information return. An informa-tion return means the returns, statements,forms, or other documents that businessesmust file with the Internal Revenue Ser-vice to report transactions with other per-sons.

(3) Payee statement. A payee statementmeans the copy of the information set forthon an information return filed with the IRSthat is furnished to the individual payee, re-cipient, participant, transferor, payer/bor-rower, debtor, or student, depending uponthe specific reporting requirements.

(c) Effective/applicability date. Thissection applies after the date of publicationof the Treasury decision adopting theserules as final regulations in the FederalRegister. The rules in these proposed reg-

ulations may be relied upon by the affectedfilers prior to the publication of final regu-lations.

Steven T. Miller,Deputy Commissioner forServices and Enforcement.

(Filed by the Office of the Federal Register on January 2,2013, 4:15 p.m., and published in the issue of the FederalRegister for January 7, 2013, 78 F.R. 913)

February 11, 2013 499 2013–7 I.R.B.

Definition of TermsRevenue rulings and revenue procedures(hereinafter referred to as “rulings”) thathave an effect on previous rulings use thefollowing defined terms to describe the ef-fect:

Amplified describes a situation whereno change is being made in a prior pub-lished position, but the prior position is be-ing extended to apply to a variation of thefact situation set forth therein. Thus, ifan earlier ruling held that a principle ap-plied to A, and the new ruling holds that thesame principle also applies to B, the earlierruling is amplified. (Compare with modi-fied, below).

Clarified is used in those instanceswhere the language in a prior ruling is be-ing made clear because the language hascaused, or may cause, some confusion.It is not used where a position in a priorruling is being changed.

Distinguished describes a situationwhere a ruling mentions a previously pub-lished ruling and points out an essentialdifference between them.

Modified is used where the substanceof a previously published position is beingchanged. Thus, if a prior ruling held that aprinciple applied to A but not to B, and thenew ruling holds that it applies to both A

and B, the prior ruling is modified becauseit corrects a published position. (Comparewith amplified and clarified, above).

Obsoleted describes a previously pub-lished ruling that is not considered deter-minative with respect to future transac-tions. This term is most commonly used ina ruling that lists previously published rul-ings that are obsoleted because of changesin laws or regulations. A ruling may alsobe obsoleted because the substance hasbeen included in regulations subsequentlyadopted.

Revoked describes situations where theposition in the previously published rulingis not correct and the correct position isbeing stated in a new ruling.

Superseded describes a situation wherethe new ruling does nothing more than re-state the substance and situation of a previ-ously published ruling (or rulings). Thus,the term is used to republish under the1986 Code and regulations the same po-sition published under the 1939 Code andregulations. The term is also used whenit is desired to republish in a single rul-ing a series of situations, names, etc., thatwere previously published over a period oftime in separate rulings. If the new rul-ing does more than restate the substance

of a prior ruling, a combination of termsis used. For example, modified and su-perseded describes a situation where thesubstance of a previously published rulingis being changed in part and is continuedwithout change in part and it is desired torestate the valid portion of the previouslypublished ruling in a new ruling that is selfcontained. In this case, the previously pub-lished ruling is first modified and then, asmodified, is superseded.

Supplemented is used in situations inwhich a list, such as a list of the names ofcountries, is published in a ruling and thatlist is expanded by adding further names insubsequent rulings. After the original rul-ing has been supplemented several times, anew ruling may be published that includesthe list in the original ruling and the ad-ditions, and supersedes all prior rulings inthe series.

Suspended is used in rare situations toshow that the previous published rulingswill not be applied pending some futureaction such as the issuance of new oramended regulations, the outcome of casesin litigation, or the outcome of a Servicestudy.

AbbreviationsThe following abbreviations in current useand formerly used will appear in materialpublished in the Bulletin.

A—Individual.Acq.—Acquiescence.B—Individual.BE—Beneficiary.BK—Bank.B.T.A.—Board of Tax Appeals.C—Individual.C.B.—Cumulative Bulletin.CFR—Code of Federal Regulations.CI—City.COOP—Cooperative.Ct.D.—Court Decision.CY—County.D—Decedent.DC—Dummy Corporation.DE—Donee.Del. Order—Delegation Order.DISC—Domestic International Sales Corporation.DR—Donor.E—Estate.EE—Employee.E.O.—Executive Order.

ER—Employer.ERISA—Employee Retirement Income Security Act.EX—Executor.F—Fiduciary.FC—Foreign Country.FICA—Federal Insurance Contributions Act.FISC—Foreign International Sales Company.FPH—Foreign Personal Holding Company.F.R.—Federal Register.FUTA—Federal Unemployment Tax Act.FX—Foreign corporation.G.C.M.—Chief Counsel’s Memorandum.GE—Grantee.GP—General Partner.GR—Grantor.IC—Insurance Company.I.R.B.—Internal Revenue Bulletin.LE—Lessee.LP—Limited Partner.LR—Lessor.M—Minor.Nonacq.—Nonacquiescence.O—Organization.P—Parent Corporation.PHC—Personal Holding Company.PO—Possession of the U.S.PR—Partner.

PRS—Partnership.PTE—Prohibited Transaction Exemption.Pub. L.—Public Law.REIT—Real Estate Investment Trust.Rev. Proc.—Revenue Procedure.Rev. Rul.—Revenue Ruling.S—Subsidiary.S.P.R.—Statement of Procedural Rules.Stat.—Statutes at Large.T—Target Corporation.T.C.—Tax Court.T.D. —Treasury Decision.TFE—Transferee.TFR—Transferor.T.I.R.—Technical Information Release.TP—Taxpayer.TR—Trust.TT—Trustee.U.S.C.—United States Code.X—Corporation.Y—Corporation.Z —Corporation.

2013–7 I.R.B. i February 11, 2013

Numerical Finding List1

Bulletins 2013–1 through 2013–7

Announcements:

2013-1, 2013-1 I.R.B. 251

2013-2, 2013-2 I.R.B. 271

2013-3, 2013-2 I.R.B. 271

2013-4, 2013-4 I.R.B. 440

2013-5, 2013-3 I.R.B. 306

2013-6, 2013-3 I.R.B. 307

2013-7, 2013-3 I.R.B. 308

2013-8, 2013-4 I.R.B. 440

2013-9, 2013-4 I.R.B. 441

2013-10, 2013-3 I.R.B. 311

2013-11, 2013-6 I.R.B. 483

Notices:

2013-1, 2013-3 I.R.B. 281

2013-2, 2013-6 I.R.B. 473

2013-3, 2013-7 I.R.B. 484

2013-7, 2013-6 I.R.B. 477

2013-8, 2013-7 I.R.B. 486

Proposed Regulations:

REG-141066-09, 2013-3 I.R.B. 289

REG-148873-09, 2013-7 I.R.B. 494

REG-122707-12, 2013-5 I.R.B. 450

Revenue Procedures:

2013-1, 2013-1 I.R.B. 1

2013-2, 2013-1 I.R.B. 92

2013-3, 2013-1 I.R.B. 113

2013-4, 2013-1 I.R.B. 126

2013-5, 2013-1 I.R.B. 170

2013-6, 2013-1 I.R.B. 198

2013-7, 2013-1 I.R.B. 233

2013-8, 2013-1 I.R.B. 237

2013-9, 2013-2 I.R.B. 255

2013-10, 2013-2 I.R.B. 267

2013-11, 2013-2 I.R.B. 269

2013-12, 2013-4 I.R.B. 313

2013-13, 2013-6 I.R.B. 478

2013-14, 2013-3 I.R.B. 283

2013-15, 2013-5 I.R.B. 444

2013-16, 2013-7 I.R.B. 488

Revenue Rulings:

2013-1, 2013-2 I.R.B. 252

Treasury Decisions:

9603, 2013-3 I.R.B. 273

9607, 2013-6 I.R.B. 469

9608, 2013-3 I.R.B. 274

1 A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2012–27 through 2012–52 is in Internal Revenue Bulletin2012–52, dated December 27, 2012.

February 11, 2013 ii 2013–7 I.R.B.

Finding List of Current Actions onPreviously Published Items1

Bulletins 2013–1 through 2013–7

Notices:

2011-14

Amplified and supplemented by

Notice 2013-7, 2013-6 I.R.B. 477

2011-38

Obsoleted by

REG-148873-09, 2013-7 I.R.B. 494

2012-60

Superseded by

Notice 2013-1, 2013-3 I.R.B. 281

Proposed Regulations:

REG-140668-07

Corrected by

Ann. 2013-6, 2013-3 I.R.B. 307

Revenue Procedures:

87-57

Modified by

Rev. Proc. 2013-13, 2013-6 I.R.B. 478

2004-66

Modified and superseded by

Rev. Proc. 2013-11, 2013-2 I.R.B. 269

2008-35

Modified and superseded by

Rev. Proc. 2013-14, 2013-3 I.R.B. 283

2008-50

Modified and superseded by

Rev. Proc. 2013-12, 2013-4 I.R.B. 313

2011-49

Modified by

Rev. Proc. 2013-6, 2013-1 I.R.B. 198

2011-52

Modified and partly superseded by

Rev. Proc. 2013-15, 2013-5 I.R.B. 444

2011-55

Amplified and supplemented by

Notice 2013-7, 2013-6 I.R.B. 477

2012-1

Superseded by

Rev. Proc. 2013-1, 2013-1 I.R.B. 1

2012-2

Superseded by

Rev. Proc. 2013-2, 2013-1 I.R.B. 92

2012-3

Superseded by

Rev. Proc. 2013-3, 2013-1 I.R.B. 113

Revenue Procedures— Continued:

2012-4

Superseded by

Rev. Proc. 2013-4, 2013-1 I.R.B. 126

2012-5

Superseded by

Rev. Proc. 2013-5, 2013-1 I.R.B. 170

2012-6

Superseded by

Rev. Proc. 2013-6, 2013-1 I.R.B. 198

2012-7

Superseded by

Rev. Proc. 2013-7, 2013-1 I.R.B. 233

2012-8

Superseded by

Rev. Proc. 2013-8, 2013-1 I.R.B. 237

2012-9

Superseded by

Rev. Proc. 2013-9, 2013-2 I.R.B. 255

2012-10

Superseded by

Rev. Proc. 2013-10, 2013-2 I.R.B. 267

2012-30

Corrected and clarified by

Ann. 2013-3, 2013-2 I.R.B. 271

Updated by

Ann. 2013-10, 2013-3 I.R.B. 311

2012-46

Corrected by

Ann. 2013-11, 2013-6 I.R.B. 483

2013-1

Corrected by

Ann. 2013-9, 2013-4 I.R.B. 441

Treasury Decisions:

9564

Corrected by

Ann. 2013-4, 2013-4 I.R.B. 440

Amended by

Ann. 2013-7, 2013-3 I.R.B. 308

1 A cumulative list of current actions on previously published items in Internal Revenue Bulletins 2012–27 through 2012–52 is in Internal Revenue Bulletin 2012–52, dated December 27,2012.

2013–7 I.R.B. iii February 11, 2013

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