Taxpayers required to account for all
or part of any long-term contract entered into after February 28,
1986, under the percentage of completion method must use Form 8697
to compute and report interest due or to be refunded under IRC
section 460(b)(3). The IRS uses Form 8697 to determine if the
interest has been figured correctly. Taxpayers may compute interest
using the actual method (Part I) or the Simplified Marginal Impact
Method (Part II).
An increase in the number of
responses by 1,000, for a total of 4,300, is attributed to an
adjustment in agency estimate. This adjustment reflects an increase
in burden by 12,170 hours. Numerous recommendations were adopted
from a committee organized to review Form 8697. 1. We added a
column on page 1 for the year the contract was completed. The
income adjustments from the prior years are based on amounts
computed when the contract is completed. (Reg. 1.460-6(c)(3)); 2.
For line 2, we removed the shading from the totals column. The
adjustments should net to zero since look-back interest only
allocates interest between the years; 3. We added an explanation to
the headings in Parts I and II to explain to taxpayers the reason
to complete each part; 4. In the signature block, we added a line
in case a spouse has to sign the form. The processing of Form 8697
has been delayed in the past if the spouse's signature was missing,
and 5. In the signature block for paid preparer's, we removed the
reference to SSN since every preparer is required to have a PTIN.
These program changes increased the burden by 19,851 hours due to
agency discretion. A total of 72,578 burden hours are requested, an
increase of 32,021 hours from the previously approved burden of
40,557 hours.
$5,572
No
No
No
No
No
Uncollected
Neal Dickman 2026225013
No
On behalf of this Federal agency, I certify that
the collection of information encompassed by this request complies
with 5 CFR 1320.9 and the related provisions of 5 CFR
1320.8(b)(3).
The following is a summary of the topics, regarding
the proposed collection of information, that the certification
covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a
benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control
number;
If you are unable to certify compliance with any of
these provisions, identify the item by leaving the box unchecked
and explain the reason in the Supporting Statement.