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pdfBulletin No. 2009-14
April 6, 2009
HIGHLIGHTS
OF THIS ISSUE
These synopses are intended only as aids to the reader in
identifying the subject matter covered. They may not be
relied upon as authoritative interpretations.
INCOME TAX
Rev. Rul. 2009–9, page 735.
Tax treatment of losses. This ruling addresses the tax
treatment of losses from criminally fraudulent investment
arrangements that take the form of “Ponzi” schemes. Rev.
Rul. 71–381 obsoleted in part.
purposes pursuant to changes made by the Worker, Retiree,
and Employer Recovery Act of 2008, Public Law 110–458
(WRERA). This notice also provides automatic approval for a
change in asset valuation method for plan years beginning
during 2009 to adopt any permissible asset valuation method.
EXEMPT ORGANIZATIONS
Rev. Rul. 2009–10, page 738.
Federal rates; adjusted federal rates; adjusted federal
long-term rate and the long-term exempt rate. For purposes of sections 382, 642, 1274, 1288, and other sections
of the Code, tables set forth the rates for April 2009.
Announcement 2009–25, page 755.
Rev. Proc. 2009–19, page 747.
Announcement 2009–26, page 755.
This procedure provides guidance to taxpayers on electing the
3, 4, or 5-year carryback of net operating losses of small businesses under section 1211 of the American Recovery and Reinvestment Tax Act of 2009.
This announcement invites public comments on the implementation and content of the Exempt Organization Academic Institution Initiative.
This announcement invites public comments on how to improve
the Internal Revenue Service’s Exempt Organizations website
(www.irs.gov/eo).
Rev. Proc. 2009–20, page 749.
This procedure provides an optional safe harbor method for
eligible taxpayers to deduct theft losses from criminally fraudulent investment arrangements that take the form of “Ponzi”
schemes.
EMPLOYEE PLANS
Notice 2009–22, page 741.
Asset valuation under section 430(g)(3)(B) as amended
by WRERA. This notice provides interim rules regarding asset valuation methods that are permitted to be used by single
employer defined benefit pension plans for minimum funding
(Continued on the next page)
Finding Lists begin on page ii.
Announcement 2009–27, page 756.
The IRS has revoked it determination that Rocky Mountain Big
Horn Sheep Foundation of Red River, MN; Skippers Learning
Center of Lake City, SC; Reliable Cash Management Association of Buffalo Grove, IL; Pecan Park Learning Center of Jackson, MS; Brucker Charitable Foundation of Mountain Home, TX;
N. U. Yoga Ashrama in America of Winter, WI; Housing Development Group of Denver, CO; National Business Fellowship Foundation of Raeford, NC; GIK Foundation of Bellevue, WA; Debt
Free Foundation, Inc., of Provo, UT; Urban Light Community Development of Houston, TX; Sweet Life Program of Las Vegas,
NV; Ladoras Family Services, Inc., of Compton, CA; Robert and
Donna Herbolich Charitable Supporting of Hudson, OH; Three
Point Volunteer Fire Department, Inc., of Williamsburg, KY; Advance Practice Foundation, Inc., of Basking Ridge, NJ; Goodwill
Industries of Greater Cleveland, Inc., of Cleveland, OH; World
Project, Inc., of Temecula, CA; Sandton Lifestyles of Los Angeles, CA; Dunn-Mason Foundation of Farmington Hills, MI; and
Walter E & Romell A King Foundation of Gary, IN; qualify as
organizations described in sections 501(c)(3) and 170(c)(2) of
the Code.
ADMINISTRATIVE
Announcement 2009–29, page 757.
This announcement provides notice of a public hearing on proposed regulations (REG-158747–06, 2009–4 I.R.B. 362) relating to withholding under section 3402(t) of the Code. The regulations reflect changes in the law made by the Tax Increase
Prevention and Reconciliation Act of 2005 that require Federal, State, and local government entities to withhold income
tax when making payments to persons providing property or
services. The regulations provide guidance to assist the government entities in complying with section 3402(t). The regulations also provide certain guidance to persons receiving payments for property or services from government entities. The
public hearing is scheduled for April 16, 2009.
April 6, 2009
2009–14 I.R.B.
The IRS Mission
Provide America’s taxpayers top quality service by helping them
understand and meet their tax responsibilities and by applying
the tax law with integrity and fairness to all.
Introduction
The Internal Revenue Bulletin is the authoritative instrument of
the Commissioner of Internal Revenue for announcing official
rulings and procedures of the Internal Revenue Service and for
publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, and other items of general
interest. It is published weekly and may be obtained from the
Superintendent of Documents on a subscription basis. Bulletin
contents 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 substantive rulings necessary to promote a uniform application of
the tax laws, including all rulings that supersede, revoke, modify, or amend any of those previously published in the Bulletin.
All published rulings apply retroactively unless otherwise indicated. Procedures relating solely to matters of internal management are not published; however, statements of internal
practices and procedures that affect the rights and duties of
taxpayers are published.
Revenue rulings represent the conclusions of the Service on the
application of the law to the pivotal facts stated in the revenue
ruling. In those based on positions taken in rulings to taxpayers
or technical advice to Service field offices, identifying details
and information of a confidential nature are deleted to prevent
unwarranted invasions of privacy and to comply with statutory
requirements.
Rulings and procedures reported in the Bulletin do not have the
force and effect of Treasury Department Regulations, but they
may be used as precedents. Unpublished rulings will not be
relied on, used, or cited as precedents by Service personnel in
the disposition of other cases. In applying published rulings and
procedures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be considered,
and Service personnel and others concerned are cautioned
against reaching the same conclusions in other cases unless
the 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 of
the 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, Legislation and Related Committee Reports.
Part III.—Administrative, Procedural, and Miscellaneous.
To the extent practicable, pertinent cross references to these
subjects are contained in the other Parts and Subparts. Also
included in this part are Bank Secrecy Act Administrative Rulings. Bank Secrecy Act Administrative Rulings are issued by
the Department of the Treasury’s Office of the Assistant Secretary (Enforcement).
Part IV.—Items of General Interest.
This part includes notices of proposed rulemakings, disbarment and suspension lists, and announcements.
The last Bulletin for each month includes a cumulative index
for the matters published during the preceding months. These
monthly indexes are cumulated on a semiannual basis, and are
published 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.
2009–14 I.R.B.
April 6, 2009
April 6, 2009
2009–14 I.R.B.
Part I. Rulings and Decisions Under the Internal Revenue Code
of 1986
Section 42.—Low-Income
Housing Credit
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 165.—Losses.
26 CFR 1.165–8: Theft losses.
(Also: §§ 63, 67, 68, 172, 1311, 1312, 1313, 1314,
1341.)
Tax treatment of losses. This ruling addresses the tax treatment of losses
from criminally fraudulent investment arrangements that take the form of “Ponzi”
schemes. Rev. Rul. 71–381 obsoleted in
part.
Rev. Rul. 2009–9
ISSUES
(1) Is a loss from criminal fraud or embezzlement in a transaction entered into for
profit a theft loss or a capital loss under
§ 165 of the Internal Revenue Code?
(2) Is such a loss subject to either the
personal loss limits in § 165(h) or the limits
on itemized deductions in §§ 67 and 68?
(3) In what year is such a loss deductible?
(4) How is the amount of such a loss
determined?
(5) Can such a loss create or increase a
net operating loss under § 172?
(6) Does such a loss qualify for the computation of tax provided by § 1341 for
the restoration of an amount held under a
claim of right?
(7) Does such a loss qualify for the application of §§ 1311–1314 to adjust tax liability in years that are otherwise barred by
the period of limitations on filing a claim
for refund under § 6511?
FACTS
A is an individual who uses the cash
receipts and disbursements method of accounting and files federal income tax returns on a calendar year basis. B holds
himself out to the public as an investment
advisor and securities broker.
2009–14 I.R.B.
In Year 1, A, in a transaction entered
into for profit, opened an investment account with B, contributed $100x to the account, and provided B with power of attorney to use the $100x to purchase and sell
securities on A’s behalf. A instructed B to
reinvest any income and gains earned on
the investments. In Year 3, A contributed
an additional $20x to the account.
B periodically issued account statements to A that reported the securities purchases and sales that B purportedly made
in A’s investment account and the balance
of the account. B also issued tax reporting
statements to A and to the Internal Revenue Service that reflected purported gains
and losses on A’s investment account. B
also reported to A that no income was
earned in Year 1 and that for each of the
Years 2 through 7 the investments earned
$10x of income (interest, dividends, and
capital gains), which A included in gross
income on A’s federal income tax returns.
At all times prior to Year 8 and part way
through Year 8, B was able to make distributions to investors who requested them.
A took a single distribution of $30x from
the account in Year 7.
In Year 8, it was discovered that B’s
purported investment advisory and brokerage activity was in fact a fraudulent investment arrangement known as a “Ponzi”
scheme. Under this scheme, B purported
to invest cash or property on behalf of each
investor, including A, in an account in the
investor’s name. For each investor’s account, B reported investment activities and
resulting income amounts that were partially or wholly fictitious. In some cases,
in response to requests for withdrawal, B
made payments of purported income or
principal to investors. These payments
were made, at least in part, from amounts
that other investors had invested in the
fraudulent arrangement.
When B’s fraud was discovered in Year
8, B had only a small fraction of the funds
that B reported on the account statements
that B issued to A and other investors. A
did not receive any reimbursement or other
recovery for the loss in Year 8. The period
of limitation on filing a claim for refund
under § 6511 has not yet expired for Years
735
5 through 7, but has expired for Years 1
through 4.
B’s actions constituted criminal fraud or
embezzlement under the law of the jurisdiction in which the transactions occurred.
At no time prior to the discovery did A
know that B’s activities were a fraudulent
scheme. The fraudulent investment arrangement was not a tax shelter as defined
in § 6662(d)(2)(C)(ii) with respect to A.
LAW AND ANALYSIS
Issue 1. Theft loss.
Section 165(a) allows a deduction for
losses sustained during the taxable year
and not compensated by insurance or otherwise. For individuals, § 165(c)(2) allows a deduction for losses incurred in
a transaction entered into for profit, and
§ 165(c)(3) allows a deduction for certain
losses not connected to a transaction entered into for profit, including theft losses.
Under § 165(e), a theft loss is sustained in
the taxable year the taxpayer discovers the
loss. Section 165(f) permits a deduction
for capital losses only to the extent allowed
in §§ 1211 and 1212. In certain circumstances, a theft loss may be taken into account in determining gains or losses for a
taxable year under § 1231.
For federal income tax purposes,
“theft” is a word of general and broad
connotation, covering any criminal appropriation of another’s property to the use
of the taker, including theft by swindling,
false pretenses and any other form of
guile. Edwards v. Bromberg, 232 F.2d 107
(5th Cir. 1956); see also § 1.165–8(d)
of the Income Tax Regulations (“theft”
includes larceny and embezzlement). A
taxpayer claiming a theft loss must prove
that the loss resulted from a taking of
property that was illegal under the law
of the jurisdiction in which it occurred
and was done with criminal intent. Rev.
Rul. 72–112, 1972–1 C.B. 60. However,
a taxpayer need not show a conviction for
theft. Vietzke v. Commissioner, 37 T.C.
504, 510 (1961), acq., 1962–2 C.B. 6.
The character of an investor’s loss related to fraudulent activity depends, in
part, on the nature of the investment. For
example, a loss that is sustained on the
April 6, 2009
worthlessness or disposition of stock acquired on the open market for investment
is a capital loss, even if the decline in
the value of the stock is attributable to
fraudulent activities of the corporation’s
officers or directors, because the officers
or directors did not have the specific intent
to deprive the shareholder of money or
property. See Rev. Rul. 77–17, 1977–1
C.B. 44.
In the present situation, unlike the situation in Rev. Rul. 77–17, B specifically
intended to, and did, deprive A of money
by criminal acts. B’s actions constituted a
theft from A, as theft is defined for § 165
purposes. Accordingly, A’s loss is a theft
loss, not a capital loss.
Issue 2. Deduction limitations.
Section 165(h) imposes two limitations
on casualty loss deductions, including
theft loss deductions, for property not connected either with a trade or business or
with a transaction entered into for profit.
Section 165(h)(1) provides that a deduction for a loss described in § 165(c)(3)
(including a theft) is allowable only to the
extent that the amount exceeds $100 ($500
for taxable years beginning in 2009 only).
Section 165(h)(2) provides that if personal casualty losses for any taxable year
(including theft losses) exceed personal
casualty gains for the taxable year, the
losses are allowed only to the extent of
the sum of the gains, plus so much of the
excess as exceeds ten percent of the individual’s adjusted gross income.
Rev. Rul. 71–381, 1971–2 C.B. 126,
concludes that a taxpayer who loans
money to a corporation in exchange for
a note, relying on financial reports that
are later discovered to be fraudulent, is
entitled to a theft loss deduction under
§ 165(c)(3). However, § 165(c)(3) subsequently was amended to clarify that the
limitations applicable to personal casualty
and theft losses under § 165(c)(3) apply
only to those losses that are not connected
with a trade or business or a transaction
entered into for profit. Tax Reform Act of
1984, Pub. L. No. 98–369, § 711 (1984).
As a result, Rev. Rul. 71–381 is obsolete
to the extent that it holds that theft losses
incurred in a transaction entered into for
profit are deductible under § 165(c)(3),
rather than under § 165(c)(2).
April 6, 2009
In opening an investment account with
B, A entered into a transaction for profit.
A’s theft loss therefore is deductible under § 165(c)(2) and is not subject to the
§ 165(h) limitations.
Section 63(d) provides that itemized deductions for an individual are the allowable deductions other than those allowed
in arriving at adjusted gross income (under § 62) and the deduction for personal
exemptions. A theft loss is not allowable
under § 62 and is therefore an itemized deduction.
Section 67(a) provides that miscellaneous itemized deductions may be deducted only to the extent the aggregate
amount exceeds two percent of adjusted
gross income. Under § 67(b)(3), losses
deductible under § 165(c)(2) or (3) are
excepted from the definition of miscellaneous itemized deductions.
Section 68 provides an overall limit on
itemized deductions based on a percentage
of adjusted gross income or total itemized
deductions. Under § 68(c)(3), losses deductible under § 165(c)(2) or (3) are excepted from this limit.
Accordingly, A’s theft loss is an itemized deduction that is not subject to the
limits on itemized deductions in §§ 67 and
68.
Issue 3. Year of deduction.
Section 165(e) provides that any
loss arising from theft is treated as sustained during the taxable year in which
the taxpayer discovers the loss. Under
§§ 1.165–8(a)(2) and 1.165–1(d), however, if, in the year of discovery, there
exists a claim for reimbursement with
respect to which there is a reasonable
prospect of recovery, no portion of the loss
for which reimbursement may be received
is sustained until the taxable year in which
it can be ascertained with reasonable certainty whether or not the reimbursement
will be received, for example, by a settlement, adjudication, or abandonment of the
claim. Whether a reasonable prospect of
recovery exists is a question of fact to be
determined upon examination of all facts
and circumstances.
A may deduct the theft loss in Year 8,
the year the theft loss is discovered, provided that the loss is not covered by a claim
for reimbursement or other recovery as to
which A has a reasonable prospect of re-
736
covery. To the extent that A’s deduction
is reduced by such a claim, recoveries on
the claim in a later taxable year are not includible in A’s gross income. If A recovers a greater amount in a later year, or an
amount that initially was not covered by
a claim as to which there was a reasonable prospect of recovery, the recovery is
includible in A’s gross income in the later
year under the tax benefit rule, to the extent the earlier deduction reduced A’s income tax. See § 111; § 1.165–1(d)(2)(iii).
Finally, if A recovers less than the amount
that was covered by a claim as to which
there was a reasonable prospect of recovery that reduced the deduction for theft in
Year 8, an additional deduction is allowed
in the year the amount of recovery is ascertained with reasonable certainty.
Issue 4. Amount of deduction.
Section 1.165–8(c) provides that the
amount deductible in the case of a theft
loss is determined consistently with the
manner described in § 1.165–7 for determining the amount of a casualty loss,
considering the fair market value of the
property immediately after the theft to be
zero. Under these provisions, the amount
of an investment theft loss is the basis of
the property (or the amount of money) that
was lost, less any reimbursement or other
compensation.
The amount of a theft loss resulting
from a fraudulent investment arrangement
is generally the initial amount invested in
the arrangement, plus any additional investments, less amounts withdrawn, if any,
reduced by reimbursements or other recoveries and reduced by claims as to which
there is a reasonable prospect of recovery.
If an amount is reported to the investor as
income in years prior to the year of discovery of the theft, the investor includes the
amount in gross income, and the investor
reinvests the amount in the arrangement,
this amount increases the deductible theft
loss.
Accordingly, the amount of A’s theft
loss for purposes of § 165 includes A’s
original Year 1 investment ($100x) and additional Year 3 investment ($20x). A’s loss
also includes the amounts that A reported
as gross income on A’s federal income tax
returns for Years 2 through 7 ($60x). A’s
loss is reduced by the amount of money
distributed to A in Year 7 ($30x). If A has
2009–14 I.R.B.
a claim for reimbursement with respect to
which there is a reasonable prospect of recovery, A may not deduct in Year 8 the portion of the loss that is covered by the claim.
Issue 5. Net operating loss.
Section 172(a) allows as a deduction for
the taxable year the aggregate of the net
operating loss carryovers and carrybacks
to that year. In computing a net operating
loss under § 172(c) and (d)(4), nonbusiness deductions of noncorporate taxpayers are generally allowed only to the extent of nonbusiness income. For this purpose, however, any deduction for casualty
or theft losses allowable under § 165(c)(2)
or (3) is treated as a business deduction.
Section 172(d)(4)(C).
Under § 172(b)(1)(A), a net operating
loss generally may be carried back 2 years
and forward 20 years. However, under
§ 172(b)(1)(F), the portion of an individual’s net operating loss arising from casualty or theft may be carried back 3 years
and forward 20 years.
Section 1211 of the American
Recovery and Reinvestment Act of
2009, Pub. L. No. 111–5, 123 Stat.
115 (February 17, 2009), amends
§ 172(b)(1)(H) of the Internal Revenue
Code to allow any taxpayer that is an
eligible small business to elect either a 3, 4,
or 5-year net operating loss carryback for
an “applicable 2008 net operating loss.”
Section 172(b)(1)(H)(iv) provides that
the term “eligible small business” has
the same meaning given that term by
§ 172(b)(1)(F)(iii), except that § 448(c)
is applied by substituting “$15 million”
for “$5 million” in each place it appears.
Section 172(b)(1)(F)(iii) provides that a
small business is a corporation or partnership that meets the gross receipts test of
§ 448(c) for the taxable year in which the
loss arose (or in the case of a sole proprietorship, that would meet such test if the
proprietorship were a corporation).
Because § 172(d)(4)(C) treats any
deduction for casualty or theft losses allowable under § 165(c)(2) or (3) as a
business deduction, a casualty or theft
loss an individual sustains after December 31, 2007, is considered a loss from
a “sole proprietorship” within the meaning of § 172(b)(1)(F)(iii). Accordingly,
an individual may elect either a 3, 4, or
5-year net operating loss carryback for
2009–14 I.R.B.
an applicable 2008 net operating loss,
provided the gross receipts test provided
in § 172(b)(1)(H)(iv) is satisfied. See
Rev. Proc. 2009–19, 2009–14 I.R.B. 747
(April 6, 2009).
To the extent A’s theft loss deduction
creates or increases a net operating loss in
the year the loss is deducted, A may carry
back up to 3 years and forward up to 20
years the portion of the net operating loss
attributable to the theft loss. If A’s loss is
an applicable 2008 net operating loss and
the gross receipts test in § 172(b)(1)(H)(iv)
is met, A may elect either a 3, 4, or 5-year
net operating loss carryback for the applicable 2008 net operating loss.
Issue 6. Restoration of amount held under
claim of right.
Section 1341 provides an alternative tax
computation formula intended to mitigate
against unfavorable tax consequences that
may arise as a result of including an item in
gross income in a taxable year and taking a
deduction for the item in a subsequent year
when it is established that the taxpayer did
not have a right to the item. Section 1341
requires that: (1) an item was included in
gross income for a prior taxable year or
years because it appeared that the taxpayer
had an unrestricted right to the item, (2) a
deduction is allowable for the taxable year
because it was established after the close
of the prior taxable year or years that the
taxpayer did not have a right to the item or
to a portion of the item, and (3) the amount
of the deduction exceeds $3,000. Section
1341(a)(1) and (3).
If § 1341 applies, the tax for the taxable year is the lesser of: (1) the tax for the
taxable year computed with the current deduction, or (2) the tax for the taxable year
computed without the deduction, less the
decrease in tax for the prior taxable year or
years that would have occurred if the item
or portion of the item had been excluded
from gross income in the prior taxable year
or years. Section 1341(a)(4) and (5).
To satisfy the requirements of
§ 1341(a)(2), a deduction must arise
because the taxpayer is under an obligation to restore the income. Section
1.1341–1(a)(1)–(2); Alcoa, Inc. v. United
States, 509 F.3d 173, 179 (3d Cir. 2007);
Kappel v. United States, 437 F.2d 1222,
1226 (3d Cir.), cert. denied, 404 U.S. 830
(1971).
737
When A incurs a loss from criminal
fraud or embezzlement by B in a transaction entered into for profit, any theft loss
deduction to which A may be entitled does
not arise from an obligation on A’s part to
restore income. Therefore, A is not entitled
to the tax benefits of § 1341 with regard to
A’s theft loss deduction.
Issue 7. Mitigation provisions.
The
mitigation
provisions
of
§§ 1311–1314 permit the Service or a taxpayer in certain circumstances to correct
an error made in a closed year by adjusting
the tax liability in years that are otherwise barred by the statute of limitations.
O’Brien v. United States, 766 F.2d 1038,
1041 (7th Cir. 1995). The party invoking
these mitigation provisions has the burden
of proof to show that the specific requirements are satisfied. Id. at 1042.
Section 1311(a) provides that if a determination (as defined in § 1313) is described in one or more of the paragraphs
of § 1312 and, on the date of the determination, correction of the effect of the error
referred to in § 1312 is prevented by the
operation of any law or rule of law (other
than §§ 1311–1314 or § 7122), then the effect of the error is corrected by an adjustment made in the amount and in the manner specified in § 1314.
Section 1311(b)(1) provides in relevant
part that an adjustment may be made under
§§ 1311–1314 only if, in cases when the
amount of the adjustment would be credited or refunded under § 1314, the determination adopts a position maintained by
the Secretary that is inconsistent with the
erroneous prior tax treatment referred to in
§ 1312.
A cannot use the mitigation provisions
of §§ 1311–1314 to adjust tax liability in
Years 2 through 4 because there is no inconsistency in the Service’s position with
respect to A’s prior inclusion of income in
Years 2 through 4. See § 1311(b)(1). The
Service’s position that A is entitled to an
investment theft loss under § 165 in Year
8 (as computed in Issue 4, above), when
the fraud loss is discovered, is consistent
with the Service’s position that A properly
included in income the amounts credited
to A’s account in Years 2 through 4. See
§ 1311(b)(1)(A).
April 6, 2009
HOLDINGS
(1) A loss from criminal fraud or embezzlement in a transaction entered into for
profit is a theft loss, not a capital loss, under § 165.
(2) A theft loss in a transaction entered into for profit is deductible under
§ 165(c)(2), not § 165(c)(3), as an itemized deduction that is not subject to the personal loss limits in § 165(h), or the limits
on itemized deductions in §§ 67 and 68.
(3) A theft loss in a transaction entered
into for profit is deductible in the year the
loss is discovered, provided that the loss is
not covered by a claim for reimbursement
or recovery with respect to which there is
a reasonable prospect of recovery.
(4) The amount of a theft loss in a transaction entered into for profit is generally
the amount invested in the arrangement,
less amounts withdrawn, if any, reduced
by reimbursements or recoveries, and reduced by claims as to which there is a reasonable prospect of recovery. Where an
amount is reported to the investor as income prior to discovery of the arrangement
and the investor includes that amount in
gross income and reinvests this amount in
the arrangement, the amount of the theft
loss is increased by the purportedly reinvested amount.
(5) A theft loss in a transaction entered
into for profit may create or increase a net
operating loss under § 172 that can be carried back up to 3 years and forward up to
20 years. An eligible small business may
elect either a 3, 4, or 5-year net operating
loss carryback for an applicable 2008 net
operating loss.
(6) A theft loss in a transaction entered
into for profit does not qualify for the computation of tax provided by § 1341.
(7) A theft loss in a transaction entered
into for profit does not qualify for the application of §§ 1311–1314 to adjust tax liability in years that are otherwise barred by
the period of limitations on filing a claim
for refund under § 6511.
DISCLOSURE OBLIGATION UNDER
§ 1.6011–4
§ 4.03(1) of Rev. Proc. 2004–66, 2004–2
C.B. 966.
EFFECT ON OTHER DOCUMENTS
Rev. Rul. 71–381 is obsoleted to the
extent that it holds that a theft loss incurred
in a transaction entered into for profit is
deductible under § 165(c)(3) rather than
§ 165(c)(2).
DRAFTING INFORMATION
The principal author of this revenue
ruling is Andrew M. Irving of the Office
of Associate Chief Counsel (Income Tax
& Accounting). For further information
regarding this revenue ruling, contact
Mr. Irving at (202) 622–5020 (not a
toll-free call.)
Section 280G.—Golden
Parachute Payments
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 482.—Allocation
of Income and Deductions
Among Taxpayers
Federal short-term, mid-term, and long-term rates
are set forth for the month of April 2009. See Rev.
Rul. 2009-10, page 738.
Section 483.—Interest on
Certain Deferred Payments
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Federal short-term, mid-term, and long-term rates
are set forth for the month of April 2009. See Rev.
Rul. 2009-10, page 738.
Section 642.—Special
Rules for Credits and
Deductions
Section 382.—Limitation
on Net Operating Loss
Carryforwards and Certain
Built-in Lossess Following
Ownership Change
Federal short-term, mid-term, and long-term rates
are set forth for the month of April 2009. See Rev.
Rul. 2009-10, page 738.
The adjusted applicable federal long-term rate is
set forth for the month of April 2009. See Rev. Rul.
2009-10, page 738.
Section 412.—Minimum
Funding Standards
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 467.—Certain
Payments for the Use of
Property or Services
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 807.—Rules for
Certain Reserves
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 846.—Discounted
Unpaid Losses Defined
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 1274.—Determination of Issue Price in the
Case of Certain Debt Instruments Issued for Property
(Also Sections 42, 280G, 382, 412, 467, 468, 482,
483, 642, 807, 846, 1288, 7520, 7872.)
Federal rates; adjusted federal rates;
adjusted federal long-term rate and the
long-term exempt rate. For purposes of
sections 382, 642, 1274, 1288, and other
sections of the Code, tables set forth the
rates for April 2009.
A theft loss in a transaction entered
into for profit that is deductible under
§ 165(c)(2) is not taken into account in
determining whether a transaction is a loss
transaction under § 1.6011–4(b)(5). See
April 6, 2009
Section 468.—Special
Rules for Mining and Solid
Waste Reclamation and
Closing Costs
738
2009–14 I.R.B.
Rev. Rul. 2009–10
This revenue ruling provides various prescribed rates for federal income
tax purposes for April 2009 (the current
month). Table 1 contains the short-term,
mid-term, and long-term applicable federal rates (AFR) for the current month
for purposes of section 1274(d) of the
Internal Revenue Code. Table 2 contains
the short-term, mid-term, and long-term
percentage for non-federally subsidized
new buildings placed in service after July
30, 2008, and before December 31, 2013,
shall not be less than 9%. Finally, Table
5 contains the federal rate for determining
the present value of an annuity, an interest
for life or for a term of years, or a remainder or a reversionary interest for purposes
of section 7520.
adjusted applicable federal rates (adjusted
AFR) for the current month for purposes
of section 1288(b). Table 3 sets forth the
adjusted federal long-term rate and the
long-term tax-exempt rate described in
section 382(f). Table 4 contains the appropriate percentages for determining the
low-income housing credit described in
section 42(b)(1) for buildings placed in
service during the current month. However, under section 42(b)(2), the applicable
REV. RUL. 2009–10 TABLE 1
Applicable Federal Rates (AFR) for April 2009
Period for Compounding
Annual
Semiannual
Quarterly
Monthly
.83%
.91%
1.00%
1.08%
.83%
.91%
1.00%
1.08%
.83%
.91%
1.00%
1.08%
.83%
.91%
1.00%
1.08%
2.15%
2.36%
2.59%
2.80%
3.24%
3.79%
2.14%
2.35%
2.57%
2.78%
3.21%
3.75%
2.13%
2.34%
2.56%
2.77%
3.20%
3.73%
2.13%
2.34%
2.56%
2.76%
3.19%
3.72%
3.67%
4.04%
4.42%
4.79%
3.64%
4.00%
4.37%
4.73%
3.62%
3.98%
4.35%
4.70%
3.61%
3.97%
4.33%
4.68%
Short-term
AFR
110% AFR
120% AFR
130% AFR
Mid-term
AFR
110% AFR
120% AFR
130% AFR
150% AFR
175% AFR
Long-term
AFR
110% AFR
120% AFR
130% AFR
Short-term adjusted
AFR
Mid-term adjusted AFR
Long-term adjusted
AFR
2009–14 I.R.B.
Annual
.87%
2.39%
4.61%
REV. RUL. 2009–10 TABLE 2
Adjusted AFR for April 2009
Period for Compounding
Semiannual
.87%
2.38%
4.56%
739
Quarterly
.87%
Monthly
.87%
2.37%
4.53%
2.37%
4.52%
April 6, 2009
REV. RUL. 2009–10 TABLE 3
Rates Under Section 382 for April 2009
Adjusted federal long-term rate for the current month
Long-term tax-exempt rate for ownership changes during the current month (the highest of the adjusted
federal long-term rates for the current month and the prior two months.)
4.61%
5.27%
REV. RUL. 2009–10 TABLE 4
Appropriate Percentages Under Section 42(b)(1) for April 2009
Note: Under Section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July
30, 2008, and before December 31, 2013, shall not be less than 9%.
Appropriate percentage for the 70% present value low-income housing credit
7.67%
Appropriate percentage for the 30% present value low-income housing credit
3.29%
REV. RUL. 2009–10 TABLE 5
Rate Under Section 7520 for April 2009
Applicable federal rate for determining the present value of an annuity, an interest for life or a term of years,
or a remainder or reversionary interest
2.6%
Section 1288.—Treatment
of Original Issue Discount
on Tax-Exempt Obligations
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Section 6411.—Tentative
Carryback and Refund
Adjustments
small businesses under section 1211 of the American Recovery and Reinvestment Tax Act of 2009 by
filing Form 1045, Application for Tentative Refund,
or Form 1139, Corporation Application for Tentative
Refund. See Rev. Proc. 2009-19, page 747.
Section 7520.—Valuation
Tables
Section 7872.—Treatment
of Loans With Below-Market
Interest Rates
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month
of April 2009. See Rev. Rul. 2009-10, page 738.
Guidance is provided for taxpayers to elect the
3, 4, or 5-year carryback of net operating losses of
April 6, 2009
740
2009–14 I.R.B.
Part III. Administrative, Procedural, and Miscellaneous
Asset Valuation under Section
430(g)(3)(B) as amended by
WRERA
Notice 2009–22
I. PURPOSE
This notice provides interim rules
regarding asset valuation methods that
are permitted to be used by single employer defined benefit pension plans for
minimum funding purposes pursuant to
changes made by the Worker, Retiree, and
Employer Recovery Act of 2008, Public
Law 110–458 (WRERA). This notice also
provides automatic approval for a change
in asset valuation method for plan years
beginning during 2009 to adopt any permissible asset valuation method.
II. BACKGROUND
Section 412 of the Internal Revenue
Code (the Code) provides minimum funding requirements that generally apply for
defined benefit pension plans. Section
412(d)(1) provides that any change in
funding method is permitted to take effect
only if it is approved by the Secretary.
A change in the plan’s funding method
includes a change in the method for determining the value of the plan’s assets, a
change in the method for determining the
plan’s liabilities, or a change in the plan’s
valuation date.
Section 430, which was added by the
Pension Protection Act of 2006, Public
Law 109–280 (PPA ’06), provides rules
for the determination of the minimum required contribution applicable to single
employer pension plans (including multiple employer plans) pursuant to § 412.
Section 430 is generally effective for plan
years beginning on or after January 1,
2008.
Section 430(g)(1) provides that all determinations made under § 430 for a plan
year must be made as of the plan’s valuation date. Section 430(g)(2) provides
that the valuation date for a plan year must
be the first day of the plan year, except
in the case of a plan with 100 or fewer
participants (determined as provided in
§ 430(g)(2)(B) and (C)).
2009–14 I.R.B.
Section 430(g)(3) provides rules regarding the determination of the value of
plan assets for purposes of § 430. Under § 430(g)(3)(A), except as provided in
§ 430(g)(3)(B), the fair market value of
plan assets must be used for this purpose.
As an alternative to the use of fair market
value, § 430(g)(3)(B) permits the use of
an actuarial value of assets based on the
average of fair market values, but only
if such method is permitted under regulations prescribed by the Secretary, does
not provide for averaging of such values
over more than the period beginning on
the last day of the 25th month preceding
the month in which the valuation date occurs and ending on the valuation date (or
a similar period in the case of a valuation
date that is not the 1st day of a month), and
does not result in a determination of the
actuarial value of plan assets that, at any
time, is lower than 90 percent or greater
than 110 percent of the fair market value
of plan assets as of the valuation date.
Section 436 provides certain limitations
on a defined benefit plan that are based on
the funded status of the plan. For this purpose, the funding status of the plan is based
on the adjusted funding target attainment
percentage, which in turn is based in part
on the value of plan assets as determined
under § 430.
Prior to amendment by WRERA, the
last sentence of § 430(g)(3)(B) provided
that any averaging under § 430(g)(3)(B)
must be adjusted for contributions and distributions (as provided by the Secretary).
Section 121(b) of WRERA amended the
last sentence of § 430(g)(3)(B) to provide
that any averaging under § 430(g)(3)(B)
must be adjusted for contributions, distributions, and expected earnings (as
determined by the plan’s actuary on the
basis of an assumed earnings rate specified by the actuary, but not in excess of
the third segment rate applicable under
§ 430(h)(2)(C)(iii)), as specified by the
Secretary. This WRERA change is effective for the same periods as the PPA ’06
provision that it amends.
On December 31, 2007, proposed regulations under §§ 430(d), 430(g), 430(h),
and 430(i) were published in the Federal
Register (REG–139236–07, 2008–9 I.R.B.
491 [72 FR 74215]) (the proposed regu-
741
lations). Section 1.430(g)–1(c)(2) of the
proposed regulations provides rules for a
permissible asset valuation method based
on the average of fair market values of plan
assets, in accordance with § 430(g)(3)(B),
prior to amendment by WRERA. Under
this asset valuation method, the actuarial value of assets is the average of the
fair market value of assets on the valuation date and the adjusted fair market value
of assets determined as of one or more
earlier determination dates. The adjusted
fair market value of assets as of a determination date is the fair market value
of plan assets on that date, increased for
contributions included in the plan’s asset
balance on the valuation date that were
not included in the plan’s asset balance
on the determination date, and decreased
for benefits and administrative expenses
paid from plan assets between that determination date and the valuation date. Because the proposed regulations were issued
prior to the enactment of WRERA, the proposed regulations do not provide for an
adjustment for expected earnings in determining the adjusted fair market value as
of an earlier determination date. Section
1.430(g)–1(f)(4) of the proposed regulations provides that any change in a plan’s
valuation date or asset valuation method
that is made for the first plan year for
which § 430 applies to the plan and that
is not inconsistent with the requirements
of § 430 is treated as having been approved by the Commissioner and does not
require the Commissioner’s specific prior
approval.
The proposed regulations are proposed
to be effective for plan years beginning
on or after January 1, 2009. The preamble of the proposed regulations provides
that plans may rely on the proposed regulations for plan years beginning during
2008. Notice 2008–21, 2008–7 I.R.B. 431,
states generally that the Service will not
challenge a reasonable interpretation of an
applicable statutory provision under § 430
or § 436 for plan years beginning during
2008, but noted that the use of averaging methods in determining the value of
plan assets under § 430(g)(3)(B) is permitted only in accordance with a method prescribed in regulations.
April 6, 2009
Part III of this notice describes the
rules expected to be incorporated in future regulations for adjusting asset values for expected earnings, pursuant to
§ 430(g)(3)(B), as amended by WRERA,
using an assumed rate of return. Taxpayers may rely on the rules described in Part
III of this notice for plan years beginning
during 2008 and 2009.
The rules in Part III of this notice modify the determination of the adjusted fair
market value of plan assets for a prior determination date that is used in determining the average of fair market values under
§ 430(g)(3)(B) as provided in the proposed
regulations. The other rules for the asset
valuation method under § 430(g)(3)(B) set
forth in the proposed regulations continue
to apply. For example, the period of time
between each of the determination dates
(treating the valuation date as a determination date) must be equal and the method
of determining the value of plan assets (including the selection of the determination
dates) is part of the plan’s funding method.
The guidance provided in this notice
with respect to § 430(g)(3)(B) of the Code
also applies for purposes of the parallel
provision in section 303(g)(3)(B) of the
Employee Retirement Income Security
Act of 1974, as amended (ERISA). (Under section 101 of the Reorganization
Plan No. 4 of 1978 (43 FR 47713), the
Secretary of the Treasury has interpretive
authority over the subject matter addressed
in this notice for purposes of ERISA, as
well as the Code.)
III. INTERIM RULES FOR
APPLICATION OF NEW ASSET
VALUATION METHOD
A. Adjustment for expected earnings.
The adjustment for expected earnings
that is made to the fair market value of plan
assets for a determination date is the sum
of the expected earnings separately determined for each period between the determination date and the valuation date. The
expected earnings for a period that is 12
months in length is equal to the product
of the assumed rate of return for the 12
months and the fair market value of assets as of the determination date that is
the beginning of the period, adjusted to reflect any contributions, benefits, and administrative expenses paid during the pe-
April 6, 2009
riod (other than contributions for a plan
year that ends with or prior to the determination date). If the period for which expected earnings is being determined is less
than 12 months, then the expected earnings
must be reduced to reflect the length of the
shorter period. The fair market value of
assets as of a determination date includes
any contribution for a plan year that ends
with or prior to the determination date that
is receivable as of the determination date
(provided that the contribution is actually
made within 81/2 months after the end of
the applicable plan year). If the contribution that is receivable as of a determination
date is for a plan year beginning on or after January 1, 2008, then only the present
value as of that determination date (determined using the effective interest rate for
the plan year for which the contribution is
made) is included in the fair market value
of assets. The adjustment to the calculation of expected earnings for a period to reflect any other contributions, and to reflect
benefits and administrative expenses paid
during the period must take into account
the timing of those contributions, benefits,
and expenses.
The assumed rate of return for a period
must be the actuary’s best estimate of the
anticipated annual rate of return on plan assets from the valuation date until all benefits are expected to be paid, limited so that
the assumed rate of return does not exceed
the interest rate limitation determined under section III.B or III.C of this notice, as
applicable for the plan year that contains
the period. If the period between one determination date and the next includes portions of more than one plan year, then the
limitation on the assumed rate of return is
the lower of the applicable limitations for
those plan years.
B. Determination of the limitation on
the assumed rate of return for periods
within plan years for which either the
funding target or the target normal cost
is determined using the three segment
interest rates under § 430(h)(2)(C).
If either the funding target or target normal cost for a plan year is determined (either for purposes of determining minimum
required contributions under § 430 or for
purposes of the disclosure requirement under section 101(f) of ERISA) using the
three segment interest rates described in
742
§ 430(h)(2)(C) (determined with or without the application of the transition rule under § 430(h)(2)(G)), then the assumed rate
of return applicable for periods within the
plan year must be limited so that it does
not exceed the third segment interest rate
used in that determination. This rule does
not apply when the full yield curve is used
to determine the funding target and target normal cost, but the rule does apply in
most other cases with respect to periods in
plan years beginning on or after January 1,
2008.
C. Determination of the limitation
on the assumed rate of return for
periods within plan years for which
neither the funding target nor the
target normal cost is determined using
the three segment interest rates under
§ 430(h)(2)(C).
If neither the funding target nor the
target normal cost for a plan year is determined using the three segment interest
rates described in § 430(h)(2)(C) (determined with or without the application of
the transition rule under § 430(h)(2)(G)),
then the limitation on the assumed rate of
return applicable for periods within the
plan year cannot be determined using the
rules described in section III.B of this notice. This is the case, for example, when:
(1) the plan year which contains the period
for which expected earnings are being determined begins before January 1, 2008;
(2) the funding target and target normal
cost are determined using the full yield
curve described in § 430(h)(2)(D)(ii); or
(3) in the case of a plan with respect to
which an election has been made under
section 402(a)(1) of PPA ’06 (which is
generally available only for the pension
plan of a commercial passenger airline
under which accruals are frozen), the minimum required contribution is determined
under section 402(e) of PPA ’06.
If the limitation on the assumed rate
of return applicable for periods within the
plan year cannot be determined using the
rules described in section III.B of this notice, then the assumed rate of return for periods within the plan year generally must
be limited so that it does not exceed the
average of the third segment rates for the
24-month period ending with the month
preceding the month that contains the valuation date for the plan year. However, if
2009–14 I.R.B.
the Service has not published the 24-month
average of the third segment rate for the
month preceding the month that contains
the valuation date for the plan year (i.e.,
the 24-month period ends before August
2007), then the spot third segment rate for
the month preceding the month that contains the valuation date is used as the limitation on the assumed rate of return for the
plan year.
D. Application of the 90 to 110 percent
corridor.
The rules for accounting for contribution receipts under § 430(g)(4) are applied
prior to the application of the 90 to 110
percent corridor under § 430(g)(3)(B)(iii).
Thus, for example, in the case of a plan
with a calendar plan year, a contribution
receivable for the 2008 plan year which is
made in 2009 will increase the upper end
of the 90 to 110 percent corridor by 110%
of the present value, determined as of January 1, 2009, of that contribution receivable.
E. Special rule for plan years beginning
during 2008.
The actuarial value of plan assets for
a plan year that begins during 2008 is
Fair market value Jan. 1:
Assets in trust as of Jan. 1 . . . . . . . . . . . . . .
Contribution for prior
plan year paid Sept. 15 . . . . . . . . . . . . . . .
Effective interest rate
for prior plan year . . . . . . . . . . . . . . . . . . .
Discounted prior plan year
contribution receivable
as of Jan. 1. . . . . . . . . . . . . . . . . . . . . . . . .
Fair market value as of Jan. 1
including contrib. receivable. . . . . . . . . . .
An actuarial valuation is performed as of January
1, 2009. The fair market value of assets, plan contri-
permitted to be determined using an asset
averaging method that complies with the
rules described in § 1.430(g)–1(f)(4) of
the proposed regulations (notwithstanding that this determination results in a
lower value of plan assets than under
§ 430(g)(3)(B) as amended by WRERA).
Accordingly, no adjustment for expected
earnings is required to be applied for purposes of determining the actuarial value of
assets under § 430(g)(3)(B) for a plan year
that begins during 2008. Thus, for a plan
year that begins in 2008, no retroactive
changes to the actuarial value of assets
need be made to comply with the amendments to § 430(g)(3)(B) made by WRERA
in the case of a plan that has complied
with applicable requirements for that plan
year (such as quarterly contribution requirements under § 430(j) and benefit
restrictions under § 436) based on the asset averaging method permitted before the
enactment of WRERA.
For a plan year that begins in 2008,
a plan for which the actuarial value of
plan assets for purposes of §§ 430 and
436 was determined based on the proposed regulations is permitted to have
the actuarial value of plan assets redetermined pursuant to § 430(g)(3)(B), as
amended by WRERA. However, plans
should take into account the risk that
any such redetermination may result in
plan operations for the plan year having
been inconsistent with the requirements
of section 206(g) of ERISA (the provision
that parallels § 436 of the Code).
F. Examples.
The following examples illustrate the
application of this section III:
Example 1 — Actuarial value of assets calculated
as of January 1, 2009, using the average of the
value on the valuation date and the two prior valuation dates
Facts
All assets of Plan A are invested in a trust fund,
the plan year is the calendar year, and the valuation
date is January 1. The actuarial value of assets is determined by averaging the fair market value as of the
valuation date and the adjusted fair market values as
of the preceding two valuation dates. Benefit payments and administrative expenses are paid evenly
throughout the year, and accordingly are assumed to
be made mid-year. The plan is not required to make
quarterly contributions, and contributions for a plan
year are made on September 15 following each plan
year.
The fair market value of assets in trust and the
contribution amounts are summarized below:
2007
2008
2009
$135,500
$176,000
$162,000
$ 61,000
$ 62,000
$ 68,781
N/A
N/A
$ 61,000
$ 62,000
$ 66,000
$196,500
$238,000
$228,000
butions, benefit payments, and other relevant items
Fair market value January 1 including contributions receivable . . . . . . . . . . . . . . . . . .
Contributions for current year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefit payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest and dividends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net realized gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balancing item . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair market value: Dec. 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.00%
for January 1, 2007 through January 1, 2009 are as
follows:
2007
2008
$196,500
$ 62,000
$ (24,000)
$ (7,000)
$ 7,500
$ 6,000
$ (3,000)
$238,000
$238,000
$ 66,000*
$ (25,000)
$ (7,500)
$ 7,000
$ (8,500)
$ (42,000)
$228,000
*Present value as of January 1, 2009
2009–14 I.R.B.
743
April 6, 2009
Computation of expected earnings
The plan sponsor elects to determine present
values and other computations under § 430 using the
24-month average of segment rates for the fourth
month preceding the month that contains the valuation date, without applying the transition rules in
§ 430(h)(2)(G). The actuary’s best estimate of the
anticipated rate of return on plan assets is 6.25% for
2007 and is 6.25% for 2008. However, the assumed
rate of return used for determining expected earnings
for each of these plan years is equal to the lesser of
the anticipated rate of return on assets for the plan
year and the applicable limitation for the plan year.
The January 1, 2007 valuation was performed
based on the funding rules in effect prior to
PPA ’06, and therefore did not use the segment rates.
Accordingly, the limitation on the assumed rate of
return for 2007 is determined under section III.C of
this notice. Furthermore, the Service did not publish
the 24-month average of the third segment rates for
the 24-month period that ended with the month prior
to the valuation date (December 2006). Therefore,
in accordance with section III.C of this notice, the
assumed rate of return applicable for periods in 2007
is limited so that it does not exceed the spot third
segment rate for the month prior to the valuation
date (December 2006), or 6.09% (per Table II of
Notice 2007–81, 2007–2 C.B. 899). Because this
rate is lower than the actuary’s best estimate of the
anticipated rate of return on plan assets for 2007, the
assumed rate of return for 2007 is limited to 6.09%.
0
(1/2)
-1)] = $11,037
0
(1/2)
-1)] = $13,875
2007: ($196,500 x .0609) + [$62,000 x (1.0609 - 1)] - [($24,000 + $7,000) x (1.0609
2008: ($238,000 x .0625) + [$66,000 x (1.0625 - 1)] - [($25,000 + $7,500) x (1.0625
For 2008, the third segment rate used to limit the
assumed rate of return is the rate used for the January 1, 2008 valuation. Because the plan sponsor has
elected to use the segment rates for the fourth month
preceding the valuation date (September 2007) without transition, the third segment rate is 6.38%. Because this rate is higher than the actuary’s best estimate of the anticipated rate of return on plan assets for
2008, the assumed rate of return for 2008 is equal to
6.25% (the actuary’s best estimate of the anticipated
rate of return on plan assets).
Expected earnings are calculated as follows for
each year:
Computation of adjusted fair market value of assets
The adjusted fair market values of assets for the
January 1, 2007 and January 1, 2008 determination
dates are computed as follows:
Adjusted values
2007
2008
Fair market value January 1:
Net adjustments:
Contributions for 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Contributions for 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefit payments for 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefit payments for 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses for 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses for 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected earnings for 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected earnings for 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$196,500
$238,000
$ 62,000
$ 66,000*
$ (24,000)
$ (25,000)
$ (7,000)
$ (7,500)
$ 11,037
$ 13,875
n/a
$ 66,000*
n/a
$ (25,000)
n/a
$ (7,500)
n/a
$ 13,875
$285,912
$285,375
Adjusted fair market value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
*Present value as of January 1, 2009
Computation of actuarial value of assets
Average of adjusted fair market value at earlier
determination dates and fair market value at valuation
date:
($285,912 + $285,375 + $228,000) ÷ 3 = $266,429
This preliminary average as of January 1, 2009
must be limited so that it satisfies the 90–110 percent corridor rules under § 430(g)(3)(B)(iii). Because 110% of $228,000 equals $250,800, the actuarial value of assets for Plan A must be limited to
$250,800 (rather than $266,429). Thus, the actuarial value of assets as of January 1, 2009 is $250,800.
April 6, 2009
Algebraically equivalent determination of actuarial value of assets
return for each year as described above and a smoothing period of three years. This equivalency is demonstrated as follows:
Note that the above calculation of the preliminary
average as of January 1, 2009 is algebraically equivalent to the method under Approval 15 of Rev. Proc.
2000–40, 2000–2 C.B. 357, using the assumed rate of
744
2009–14 I.R.B.
Actual earnings:
Interest and dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net realized gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balancing item. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total actual earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gain (loss) equal to actual earnings minus expected earnings . . . . . . . . . . . . . . . . . . . .
2007
2008
$ 7,500
$ 6,000
$ (3,000)
$ 10,500
$ 11,037
$ (537)
$ 7,000
$ (8,500)
$ (42,000)
$ (43,500)
$ 13,875
$ (57,375)
Preliminary actuarial value of assets as of January 1, 2009 equals:
$228,000 + one-third of the 2007 loss (1/3 x $537) + two-thirds of the 2008 loss (2/3 x $57,375) = $266,429
As noted above, this preliminary actuarial value
of assets must be limited so that the actuarial value
of assets as of January 1, 2009 satisfies the 90–110
percent corridor rules under § 430(g)(3)(B)(iii). Because the preliminary actuarial value of assets exceeds 110% of the fair market value of plan assets as
of the valuation date, the actuarial value of assets as
of January 1, 2009 is $250,800.
Example 2 — Actuarial value of assets calculated
as of January 1, 2010, using the average of the
value on the valuation date and four earlier quarterly determination dates
Quarter beginning
Fair market value:
Assets in trust at beginning
of quarter . . . . . . . . . . . . . . . . . . . . .
Contributions receivable for
prior plan year . . . . . . . . . . . . . . . . .
Effective interest rate for
prior plan year . . . . . . . . . . . . . . . . .
Discounted prior plan year
contributions receivable
at beginning of quarter . . . . . . . . . .
Total fair market value at
beginning of quarter,
including contributions
receivable. . . . . . . . . . . . . . . . . . . . .
Facts
The facts are the same as in Example 1, except
that the actuarial value of assets is calculated by averaging the fair market value as of the current valuation date and adjusted fair market values as of the beginning of the four preceding calendar quarters. Two
contributions are made for the 2009 plan year—a contribution of $10,000 made on May 1, 2009, and a contribution of $60,000 made on September 15, 2010.
The effective interest rate for the 2009 plan year is
th
6.10%. Benefits are paid on the 15 day of each
month, and so benefits for the quarter are assumed
to be made at the midpoint of each quarter. During
1/1/2009
4/1/2009
7/1/2009
10/1/2009
1/1/2010
$162,000
$143,232
$153,649
$215,300
$216,900
$ 68,781
$ 68,781
$ 68,781
$
$ 60,000
6.00%
6.00%
6.00%
0
6.00%
6.10%
$ 66,000
$ 66,968
$ 67,951
$
0
$ 57,536
$228,000
$210,200
$221,600
$215,300
$274,436
The fair market value of assets, plan contributions, benefit payments, and other relevant items for
the four quarters of 2009 are shown in the table below:
Quarter beginning
Total fair market value at beginning of quarter,
including contributions receivable . . . . . . . . . . . . . . . . . . . . .
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefit payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest and dividends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net realized gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balancing item* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair market value at end of quarter, including
contributions receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009–14 I.R.B.
2009, administrative expenses are paid at the beginning of each quarter.
An actuarial valuation is performed as of January
1, 2010. For each determination date for which the
contribution of $68,781 paid on September 15, 2009
is a contribution receivable for the 2008 plan year, the
contribution receivable is discounted to the determination date using the 2008 effective interest rate of
6.00%. The contribution of $60,000 paid on September 15, 2010 for the 2009 plan year is reflected in the
fair market value of assets as of January 1, 2010, discounted to that date using the 2009 effective interest
(8.5/12)
= $57,536), as
rate of 6.1% ($60,000 ÷ 1.061
illustrated in the table below:
1/1/2009
4/1/2009
7/1/2009
10/1/2009
$228,000
$210,200
$221,600
$215,300
$
0
$ (6,000)
$ (2,100)
$ 2,300
$ 3,000
$ (15,000)
$ 10,000
$ (6,500)
$ (1,900)
$ 1,800
$ 3,000
$ 5,000
$
0
$ (6,300)
$ (2,300)
$ 2,000
$ 3,000
$ (2,700)
$ 57,536**
$ (6,400)
$ (1,800)
$ 2,800
$ 3,000
$ 4,000
$210,200
$221,600
$215,300
$274,436
745
April 6, 2009
* Includes the change in discounted value of the contribution receivable.
** Discounted value of contribution receivable for the 2009 plan year, paid after the end of the 2009 plan year. This discounted amount is treated as if it is paid on
December 31, 2009, for the purpose of calculating the fair market value and the average value of assets.
Computation of expected earnings
The plan sponsor elects to determine present values and other computations under § 430 using the
24-month segment rates for the fourth month preceding the month that contains the valuation, without
applying the transition rules in § 430(h)(2)(G). The
actuary’s best estimate of the anticipated rate of return on plan assets is 6.25% for 2009. This rate is
compared with the third segment rate for the 2009
plan year of 6.56% (based on the rates published for
September 2008); because the third segment rate is
higher than the actuary’s best estimate of the antici-
pated rate of return on plan assets, the actuary’s assumed rate of return is not restricted.
Expected earnings are calculated for each quarter, taking into account the timing of contributions,
benefit payments, and administrative expenses during each quarter, as follows:
Quarter beginning 1/1/2009:
(3/12)
(1.5/12)
(3/12)
-1)] - [$6,000 x (1.0625
-1)] - [$2,100 x (1.0625
-1)] = $3,404
[$228,000 x (1.0625
Quarter beginning 4/1/2009:
(3/12)
(2/12)
(1.5/12)
(3/12)
-1)] + [$10,000 x (1.0625
-1)] - [$6,500 x (1.0625
-1)] - [$1,900 x (1.0625
-1)] = $3,233
[$210,200 x (1.0625
Quarter beginning 7/1/2009:
(3/12)
(1.5/12)
(3/12)
-1)] - [$6,300 x (1.0625
-1)] - [$2,300 x (1.0625
-1)] = $3,301
[$221,600 x (1.0625
Quarter beginning 10/1/2009:
(3/12)
0
(1.5/12)
(3/12)
-1)] + [$57,536 x (1.0625 -1)] - [$6,400 x (1.0625
-1)] - [$1,800 x (1.0625
-1)] = $3,212
[$215,300 x (1.0625
Computation of average value of assets
The average value of assets as of January 1, 2010,
is computed as follows:
Determination date
Total fair market value at beginning of quarter, including
contributions receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net adjustments*
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefit payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected earnings:
1/1/2009 - 3/31/2009 . . . . . . . . . . . . . . . . . . . . . . . . .
4/1/2009 - 6/30/2009 . . . . . . . . . . . . . . . . . . . . . . . . .
7/1/2009 - 9/30/2009 . . . . . . . . . . . . . . . . . . . . . . . . .
10/2009 - 12/31/2009 . . . . . . . . . . . . . . . . . . . . . . . . .
Adjusted fair market value . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1/1/2009
4/1/2009
7/1/2009
10/1/2009
$228,000
$210,200
$221,600
$215,300
$ 67,536
$ (25,200)
$ (8,100)
$ 67,536
$ (19,200)
$ (6,000)
$ 57,536
$ (12,700)
$ (4,100)
$ 57,536*
$ (6,400)
$ (1,800)
$
$
$
$
$
$
$
N/A
3,233
3,301
3,212
N/A
N/A
3,301
3,212
3,404
3,233
3,301
3,212
$275,386
$
$
$262,282
$268,849
$
N/A
N/A
N/A
3,212
$267,848
* Entries reflect the sum of the amounts for the current and later quarters, as illustrated for expected earnings.
Average of adjusted fair market value of assets at earlier determination dates and fair market value at valuation date:
($275,386 + $262,282 + $268,849 + $267,848 + $274,436) ÷ 5 = $269,760
This average must be limited so that the actuarial value of assets as of January 1, 2010 satisfies the 90–110 percent corridor rules under
§ 430(g)(3)(B)(iii). Because the average of adjusted
fair market values of $269,760 falls between 90%
and 110% of $274,436, the actuarial value of assets
as of January 1, 2010 is $269,760.
April 6, 2009
IV. AUTOMATIC APPROVAL FOR
CHANGE IN ASSET VALUATION
METHOD
This notice provides approval by the
Commissioner for a change in a plan’s
asset valuation method to adopt an asset
valuation method that is permitted under
§ 430(g)(3), as amended by WRERA, that
is made for a plan year that begins during
2009. In addition, the approval that would
apply under the proposed regulations for a
746
change in funding method for a plan year
that begins during 2008 will apply to a
change in a plan’s asset valuation method
made to adopt the asset valuation method
permitted by § 430(g)(3)(B), as amended
by WRERA, that is made for such a plan
year.
V. DRAFTING INFORMATION
The principal authors of this notice
are Carolyn Zimmerman of the Employee
2009–14 I.R.B.
Plans, Tax Exempt and Government Entities Division, and Michael P. Brewer
and Linda S. F. Marshall of the Office
of the Division Counsel/Associate Chief
Counsel (Tax Exempt and Government
Entities). For further information regarding this notice, please contact the Employee Plans taxpayer assistance answering service at 1–877–829–5500 (a toll-free
number), Mr. Brewer or Ms. Marshall
at (202) 622–6090 (not a toll-free
number), or e-mail Ms. Zimmerman, at
RetirementPlanQuestions@irs.gov.
26 CFR 601.105: Examination of returns and claims
for refund, credit or abatement; determination of correct tax liability.
(Also Part I, §§ 172, 6411.)
Rev. Proc. 2009–19
SECTION 1. PURPOSE
.01 This revenue procedure provides
guidance under § 1211 of the American
Recovery and Reinvestment Tax Act of
2009, Div. B of Pub. L. No. 111–5,
123 Stat. 115 (February 17, 2009) (the
Act). Section 1211 of the Act amends
§ 172(b)(1)(H) of the Internal Revenue
Code to allow any taxpayer that is an eligible small business (ESB) to elect a 3, 4,
or 5-year net operating loss (NOL) carryback for a taxable year ending after 2007.
.02 Specifically, this revenue procedure
provides guidance to taxpayers as to the
time and manner for making an election
under § 172(b)(1)(H), including the election of a 3, 4, or 5-year carryback period
and an election to apply § 172(b)(1)(H)
to an NOL for a taxable year beginning
in 2008, instead of an NOL for a taxable
year ending in 2008. This revenue procedure provides guidance on when and how
to elect § 172(b)(1)(H) if the taxpayer previously filed an election under § 172(b)(3)
to forgo the NOL carryback period.
.03 This revenue procedure also provides guidance on how a taxpayer makes
the election if the taxpayer is a partner of
an ESB that is a partnership, a shareholder
of an ESB that is an S corporation, or a sole
proprietor.
SECTION 2. BACKGROUND
.01 Section 172(a) allows a deduction
equal to the aggregate of the NOL carry-
2009–14 I.R.B.
overs and carrybacks to the taxable year.
Section 172(b)(1)(A)(i) provides that an
NOL for any taxable year generally must
be carried back to each of the 2 years
preceding the taxable year of the NOL.
Section 172(b)(3) provides that any taxpayer entitled to a carryback period under
§ 172(b)(1) may make an irrevocable election to relinquish the carryback period with
respect to an NOL for any taxable year.
.02 Section 6411(a) provides that a taxpayer may file an application for a tentative carryback adjustment of the tax for
the prior taxable year affected by an NOL
carryback from any taxable year. Section
6411(a) also provides that the application
must be filed on or after the date of filing for the return for the taxable year of
the NOL from which the carryback results
and within a period of 12 months after that
taxable year or, with respect to any portion
of a business credit carryback attributable
to an NOL from a subsequent taxable year,
within a period of 12 months from the end
of the subsequent taxable year. Section
6411(b) provides a 90-day period during
which the Internal Revenue Service will
make a limited examination of the application to discover omissions and errors of
computation and determine the amount of
the decrease in tax attributable to the carryback. The Service may disallow, without further action, any application that contains errors of computation that cannot be
corrected within the 90-day period or that
contains material omissions. The decrease
in tax attributable to the carryback will
be applied against unpaid amounts of tax.
Any remainder of the decrease will, within
the 90-day period, be credited or refunded.
.03 Section 172(b)(1)(H) permits an
ESB to carry back its applicable 2008
NOL to 3, 4, or 5 years preceding the taxable year of the NOL, as the ESB elects.
.04 Section 172(b)(1)(H)(iv) provides
that the term “eligible small business” has
the meaning given by § 172(b)(1)(F)(iii),
except that § 448(c) is applied by substituting “$15 million” for “$5 million” each
place it appears. Section 172(b)(1)(F)(iii)
provides that a small business is a corporation or partnership that meets the gross receipts test of § 448(c) for the taxable year
in which the loss arose (or in the case of a
sole proprietorship, that would meet such
test if the proprietorship were a corporation).
747
.05 Section 448 generally prohibits certain taxpayers from using the cash receipts
and disbursements method of accounting.
Section 448(b)(3) provides an exception to
this requirement in the case of any corporation or partnership if, for all prior taxable
years beginning after December 31, 1985,
the entity (or any predecessor) met the $5
million gross receipts test of § 448(c). Section 448(c)(1) provides that a corporation
or partnership meets the $5 million gross
receipts test for any prior taxable year if
the average annual gross receipts of the entity for the 3-taxable-year period ending
with that prior taxable year does not exceed $5 million. Section 448(c)(2) (aggregation rules) generally provides that all
persons treated as a single employer under
subsection (a) or (b) of § 52 or subsection
(m) or (o) of § 414 are treated as one person for purposes of § 448(c)(1).
.06 The $5 million gross receipts test
of § 448(c) is applied to a taxpayer’s prior
taxable year by determining the average annual gross receipts for the 3-year
period that ends with that prior taxable
year. Under §172(b)(1)(F)(iii), in order
to be a small business, a taxpayer must
meet the gross receipts test of § 448(c)
for the taxable year in which the NOL
arose. Consequently, to determine if a
taxpayer is a small business for purposes
of § 172(b)(1)(F)(iii), the taxable year in
which the NOL arose is the last taxable
year of the 3-year period to which the test
is applied.
.07 Section 172(b)(1)(H)(ii)(I) provides
that the term “applicable 2008 net operating loss” means the taxpayer’s NOL for
any taxable year ending in 2008. However,
under § 172(b)(1)(H)(ii)(II), the taxpayer
may elect instead to have the term mean
the taxpayer’s NOL for any taxable year
beginning in 2008.
.08 Section 172(b)(1)(H)(iii) provides
that any election under § 172(b)(1)(H) is
required to be made in such a manner as
may be prescribed by the Secretary, and
must be made by the due date (including
extension of time) for filing the taxpayer’s
return for the taxable year of the NOL. The
election is irrevocable and may be made
only for one taxable year.
.09 Section 1211(d)(2) of the Act provides that in the case of an applicable 2008
NOL for a taxable year ending before the
date of enactment of the Act (February 17,
2009), (A) a previous election made un-
April 6, 2009
der § 172(b)(3) for the NOL may be revoked on or before April 17, 2009; (B)
the § 172(b)(1)(H) election for the NOL
is treated as timely if made on or before
April 17, 2009; and (C) an application under § 6411(a) with respect to the NOL is
treated as timely if filed on or before April
17, 2009.
SECTION 3. SCOPE
This revenue procedure applies to any
taxpayer that is an ESB, a partner of a partnership that is an ESB, a shareholder in an
S corporation that is an ESB, or a sole proprietor of a business that is an ESB, and
that incurred an NOL for any taxable year
ending in 2008 or beginning in 2008.
SECTION 4. APPLICATION
.01 Eligible small businesses that have
not filed a return for the applicable 2008
NOL taxable year.
(1) A taxpayer within the scope of this
revenue procedure that has not filed a return for the taxable year in which the applicable 2008 NOL arises makes the election
under § 172(b)(1)(H) by attaching a statement to the taxpayer’s federal income tax
return for the taxable year in which the applicable 2008 NOL arises. The statement
must—
(a) Clearly state that the taxpayer is
electing to apply §172(b)(1)(H);
(b) Describe the length of the NOL carryback period elected by the taxpayer (3,
4, or 5 years); and
(c) If applicable, state that the taxpayer
is electing to apply § 172(b)(1)(H) to
the taxpayer’s taxable year that begins in
2008.
(2) The taxpayer’s return must be filed
by the due date (including extensions of
time) for filing the taxpayer’s return for
the taxable year of the applicable 2008
NOL. In the case of a late election, relief
may be available under § 301.9100–2(b)
of the Procedure and Administration Regulations. Notwithstanding this due date,
an election to apply § 172(b)(1)(H) to an
applicable 2008 NOL for a taxable year
ending before February 17, 2009, will be
treated as timely if the election is filed on
or before April 17, 2009.
.02 Eligible small businesses that have
filed a return for the applicable 2008 NOL
April 6, 2009
taxable year and did not elect to forgo the
NOL carryback period.
(1) A taxpayer within the scope of this
revenue procedure that previously filed a
return for the applicable 2008 NOL taxable
year and did not elect to forgo the NOL carryback period under § 172(b)(3) makes the
election under § 172(b)(1)(H) as follows:
(a) What to file.
(i) The taxpayer must file the appropriate form including a statement of the carryback period the taxpayer elects (3, 4, or
5 years). The appropriate form is—
(A) For corporations, Form 1139, Corporation Application for Tentative Refund,
or Form 1120X, Amended U.S. Corporation Income Tax Return;
(B) For individuals, Form 1045, Application for Tentative Refund, or Form
1040X, Amended U.S. Individual Income
Tax Return; and
(C) For estates or trusts, Form 1045,
or amended Form 1041, U.S. Income Tax
Return for Estates and Trusts.
(ii) A taxpayer that makes the election
by filing an amended return must file the
return for the earliest taxable year to which
the taxpayer is carrying back the applicable 2008 NOL. The taxpayer should not
file an amended return for the applicable
2008 NOL taxable year.
(b) Labels. The taxpayer should type or
print across the top of the appropriate form
“2008 NOL Carryback Election Pursuant
to Rev. Proc. 2009–19.” If the taxpayer
previously filed an application for a tentative carryback adjustment or an amended
return applying an NOL carryback period that did not qualify for the election
under § 172(b)(1)(H), the taxpayer also
should type or print across the top of the
appropriate form “Amended NOL Carryback Election Pursuant to Rev. Proc.
2009–19.” In addition to the labels listed
above, a taxpayer that elects pursuant to
§ 172(b)(1)(H)(ii)(II) to treat its NOL arising in a taxable year beginning in 2008 as
the applicable 2008 NOL, must include a
statement that the taxpayer is electing to
apply § 172(b)(1)(H) to a taxable year that
begins in 2008.
(c) When to file. The taxpayer must file
the appropriate form by the later of the date
that is 6 months after the due date (excluding extensions) for filing the taxpayer’s return for the taxable year of the applicable
2008 NOL, or on or before April 17, 2009.
748
(2) If a taxpayer makes the election
under § 172(b)(1)(H) by filing an applicable form that amends a prior refund
claim, the amendment also will apply to
a carryback of any alternative tax NOL
for the same taxable year. In the case of
an amended application for a tentative
carryback adjustment, the 90-day period
described in § 6411(b) will begin on the
date the amended application is filed.
.03 Eligible small businesses that
elected to forgo the NOL carryback period under § 172(b)(3). A taxpayer within
the scope of this revenue procedure that
previously elected under § 172(b)(3) to
forgo the carryback period for an applicable 2008 NOL for a taxable year ending
before February 17, 2009, may revoke
that election and make the election under
§ 172(b)(1)(H). Any revocation of the
election to forgo the NOL carryback period also will apply to a carryback of any
alternative tax NOL for the same taxable
year. The taxpayer makes the revocation
and election by following the procedures
of section 4.02 of this revenue procedure.
However, instead of the label required in
section 4.02(1)(b) of this revenue procedure, the taxpayer should type or print
across the top of the appropriate form
“2008 NOL Carryback Election and Revocation of NOL Carryback Waiver Pursuant
to Rev. Proc. 2009–19.” The taxpayer
must file the revocation and new election
under § 172(b)(1)(H) on or before April
17, 2009.
.04 Partnerships, S corporations, and
sole proprietorships.
(1) If the taxpayer is a partner in a
partnership that qualifies as an ESB, the
taxpayer may make the § 172(b)(1)(H)
election for its distributive share of the
qualifying ESB partnership income, gain,
loss, and deduction that is both allocable
to the taxpayer under § 704 and allowed in
calculating the taxpayer’s applicable 2008
NOL.
(2) If the taxpayer is a shareholder in
an S corporation that qualifies as an ESB,
the taxpayer may make the § 172(b)(1)(H)
election for its pro rata share of the qualifying ESB S corporation income, gain,
loss, and deduction under § 1366 that is allowed in calculating the shareholder’s applicable 2008 NOL.
(3) If the taxpayer is an owner of a sole
proprietorship that qualifies as an ESB,
the taxpayer may make the § 172(b)(1)(H)
2009–14 I.R.B.
election for the qualifying ESB sole proprietorship income, gain, loss, and deduction that is allowed in calculating the taxpayer’s applicable 2008 NOL.
(4) In determining whether a partnership, S corporation, or sole proprietorship
qualifies as an ESB, the gross receipts test
applies at the partnership, corporate, or
sole proprietorship level. The aggregation rules of § 448(c)(2) apply to determine whether the partnership, S corporation, or sole proprietorship meets the gross
receipts test of § 448(c).
(5) The amount of the taxpayer’s applicable 2008 NOL that the taxpayer may
carry back under §172(b)(1)(H) is limited
to the lesser of:
(a) The taxpayer’s items of income,
gain, loss or deduction that are allowed
in calculating the taxpayer’s applicable
2008 NOL and are from one or more
partnerships, S corporations or sole proprietorships that qualify as ESBs, or
(b) The taxpayer’s applicable 2008
NOL.
(6) Examples.
(a) Example 1. Partnerships A, B, and C have
average annual gross receipts of $10 million, $12
million, and $14 million, respectively. Partner T
owns a 40% interest in each partnership. None of
the partnerships is required to be aggregated with
any other entity for purposes of the aggregation
rules of § 448(c)(2). Subject to the limitations in
section 4.04(5) of this revenue procedure, Partner T
may apply its election under § 172(b)(1)(H) to the
portion of its applicable 2008 NOL attributable to
its distributive share of the income, gain, loss, and
deduction of each of Partnerships A, B, and C.
(b) Example 2. The facts are the same as in Example 1, except that Partnerships A and B are under
common control within the meaning of § 52(b)(1).
Accordingly, Partnerships A and B are treated as one
person under the aggregation rules of § 448(c)(2).
Because the aggregated average annual gross receipts
of Partnerships A and B exceed $15 million, Partnerships A and B do not qualify as ESBs. Partner
T may not apply its election under § 172(b)(1)(H) to
the portion of its applicable 2008 NOL attributable
to its distributive share of the income, gain, loss, and
deduction of Partnerships A and B. However, subject
to the limitations in section 4.04(5) of this revenue
procedure, Partner T may apply its election under
§ 172(b)(1)(H) to the portion of its applicable 2008
NOL attributable to its distributive share of income,
gain, loss, and deduction of Partnership C.
SECTION 5. EFFECTIVE DATE
This revenue procedure is effective for
NOLs arising in taxable years ending after
December 31, 2007.
SECTION 6. PAPERWORK
REDUCTION ACT
The collection of information contained in this revenue procedure has been
reviewed and approved by the Office
of Management and Budget in accordance with the Paperwork Reduction Act
(44 U.S.C. 3507) under the following
control numbers: 1545–0074 Form 1040
(U.S. Individual Income Tax Return) and
Form 1040X (Amended U.S. Individual
Income Tax Return); 1545–0123 Form
1120 (U.S. Corporation Income Tax
Return);
1545–0132 Form 1120X
(Amended U.S. Corporation Income Tax
Return); 1545–0092 Form 1041 (U.S.
Income Tax Return for Estates and Trusts);
1545–0098 Form 1045 (Application for
Tentative Refund); 1545–0582 Form 1139
(Corporation Application for Tentative
Refund). For further information, please
refer to the Paperwork Reduction Act
statements accompanying these forms.
DRAFTING INFORMATION
The principal author of this revenue
procedure is Seoyeon Park of the Office of
the Associate Chief Counsel (Income Tax
and Accounting). For further information
regarding this notice, contact Ms. Park at
(202) 622–4960 (not a toll-free call).
26 CFR 601.105: Examination of returns and claims
for refund, credit or abatement; determination of correct tax liability.
(Also Part I, §§ 165; 1.165–8(c).)
Rev. Proc. 2009–20
SECTION 1. PURPOSE
This revenue procedure provides an optional safe harbor treatment for taxpayers
that experienced losses in certain investment arrangements discovered to be criminally fraudulent. This revenue procedure
also describes how the Internal Revenue
Service will treat a return that claims a deduction for such a loss and does not use the
safe harbor treatment described in this revenue procedure.
SECTION 2. BACKGROUND
.01 The Service and Treasury Department are aware of investment arrange-
2009–14 I.R.B.
749
ments that have been discovered to be
fraudulent, resulting in significant losses
to taxpayers. These arrangements often take the form of so-called “Ponzi”
schemes, in which the party perpetrating
the fraud receives cash or property from
investors, purports to earn income for the
investors, and reports to the investors income amounts that are wholly or partially
fictitious. Payments, if any, of purported
income or principal to investors are made
from cash or property that other investors
invested in the fraudulent arrangement.
The party perpetrating the fraud criminally
appropriates some or all of the investors’
cash or property.
.02 Rev. Rul. 2009–9, 2009–14 I.R.B.
735 (April 6, 2009), describes the proper
income tax treatment for losses resulting
from these Ponzi schemes.
.03 The Service and Treasury Department recognize that whether and when investors meet the requirements for claiming
a theft loss for an investment in a Ponzi
scheme are highly factual determinations
that often cannot be made by taxpayers
with certainty in the year the loss is discovered.
.04 In view of the number of investment arrangements recently discovered to
be fraudulent and the extent of the potential losses, this revenue procedure provides an optional safe harbor under which
qualified investors (as defined in § 4.03 of
this revenue procedure) may treat a loss as
a theft loss deduction when certain conditions are met. This treatment provides
qualified investors with a uniform manner
for determining their theft losses. In addition, this treatment avoids potentially difficult problems of proof in determining how
much income reported in prior years was
fictitious or a return of capital, and alleviates compliance and administrative burdens on both taxpayers and the Service.
SECTION 3. SCOPE
The safe harbor procedures of this revenue procedure apply to taxpayers that are
qualified investors within the meaning of
section 4.03 of this revenue procedure.
SECTION 4. DEFINITIONS
The following definitions apply solely
for purposes of this revenue procedure.
April 6, 2009
.01 Specified fraudulent arrangement.
A specified fraudulent arrangement is an
arrangement in which a party (the lead
figure) receives cash or property from
investors; purports to earn income for
the investors; reports income amounts to
the investors that are partially or wholly
fictitious; makes payments, if any, of
purported income or principal to some investors from amounts that other investors
invested in the fraudulent arrangement;
and appropriates some or all of the investors’ cash or property. For example,
the fraudulent investment arrangement described in Rev. Rul. 2009–9 is a specified
fraudulent arrangement.
.02 Qualified loss. A qualified loss is a
loss resulting from a specified fraudulent
arrangement in which, as a result of the
conduct that caused the loss—
(1) The lead figure (or one of the lead
figures, if more than one) was charged by
indictment or information (not withdrawn
or dismissed) under state or federal law
with the commission of fraud, embezzlement or a similar crime that, if proven,
would meet the definition of theft for purposes of § 165 of the Internal Revenue
Code and § 1.165–8(d) of the Income Tax
Regulations, under the law of the jurisdiction in which the theft occurred; or
(2) The lead figure was the subject of
a state or federal criminal complaint (not
withdrawn or dismissed) alleging the commission of a crime described in section
4.02(1) of this revenue procedure, and either—
(a) The complaint alleged an admission
by the lead figure, or the execution of an affidavit by that person admitting the crime;
or
(b) A receiver or trustee was appointed
with respect to the arrangement or assets
of the arrangement were frozen.
.03 Qualified investor. A qualified investor means a United States person, as defined in § 7701(a)(30) —
(1) That generally qualifies to deduct
theft losses under § 165 and § 1.165–8;
(2) That did not have actual knowledge
of the fraudulent nature of the investment
arrangement prior to it becoming known to
the general public;
(3) With respect to which the specified
fraudulent arrangement is not a tax shelter,
as defined in § 6662(d)(2)(C)(ii); and
(4) That transferred cash or property
to a specified fraudulent arrangement. A
April 6, 2009
qualified investor does not include a person that invested solely in a fund or other
entity (separate from the investor for federal income tax purposes) that invested
in the specified fraudulent arrangement.
However, the fund or entity itself may be a
qualified investor within the scope of this
revenue procedure.
.04 Discovery year. A qualified investor’s discovery year is the taxable year
of the investor in which the indictment, information, or complaint described in section 4.02 of this revenue procedure is filed.
.05 Responsible group. Responsible
group means, for any specified fraudulent
arrangement, one or more of the following:
(1) The individual or individuals (including the lead figure) who conducted the
specified fraudulent arrangement;
(2) Any investment vehicle or other entity that conducted the specified fraudulent
arrangement, and employees, officers, or
directors of that entity or entities;
(3) A liquidation, receivership, bankruptcy or similar estate established with respect to individuals or entities who conducted the specified fraudulent arrangement, in order to recover assets for the benefit of investors and creditors; or
(4) Parties that are subject to claims
brought by a trustee, receiver, or other
fiduciary on behalf of the liquidation, receivership, bankruptcy or similar estate described in section 4.05(3) of this revenue
procedure.
.06 Qualified investment.
(1) Qualified investment means the excess, if any, of —
(a) The sum of —
(i) The total amount of cash, or the basis
of property, that the qualified investor invested in the arrangement in all years; plus
(ii) The total amount of net income with
respect to the specified fraudulent arrangement that, consistent with information received from the specified fraudulent arrangement, the qualified investor included
in income for federal tax purposes for all
taxable years prior to the discovery year,
including taxable years for which a refund
is barred by the statute of limitations; over
(b) The total amount of cash or property that the qualified investor withdrew in
all years from the specified fraudulent arrangement (whether designated as income
or principal).
(2) Qualified investment does not include any of the following—
750
(a) Amounts borrowed from the responsible group and invested in the specified
fraudulent arrangement, to the extent the
borrowed amounts were not repaid at the
time the theft was discovered;
(b) Amounts such as fees that were paid
to the responsible group and deducted for
federal income tax purposes;
(c) Amounts reported to the qualified
investor as taxable income that were not
included in gross income on the investor’s
federal income tax returns; or
(d) Cash or property that the qualified
investor invested in a fund or other entity
(separate from the qualified investor for
federal income tax purposes) that invested
in a specified fraudulent arrangement.
.07 Actual recovery. Actual recovery
means any amount a qualified investor actually receives in the discovery year from
any source as reimbursement or recovery
for the qualified loss.
.08 Potential insurance/SIPC recovery.
Potential insurance/SIPC recovery means
the sum of the amounts of all actual or
potential claims for reimbursement for a
qualified loss that, as of the last day of the
discovery year, are attributable to—
(1) Insurance policies in the name of the
qualified investor;
(2) Contractual arrangements other
than insurance that guaranteed or otherwise protected against loss of the qualified
investment; or
(3) Amounts payable from the Securities Investor Protection Corporation
(SIPC), as advances for customer claims
under 15 U.S.C. § 78fff–3(a) (the Securities Investor Protection Act of 1970), or by
a similar entity under a similar provision.
.09 Potential direct recovery. Potential
direct recovery means the amount of all actual or potential claims for recovery for a
qualified loss, as of the last day of the discovery year, against the responsible group.
.10 Potential third-party recovery. Potential third-party recovery means the
amount of all actual or potential claims
for recovery for a qualified loss, as of the
last day of the discovery year, that are not
described in section 4.08 or 4.09 of this
revenue procedure.
SECTION 5. APPLICATION
.01 In general. If a qualified investor
follows the procedures described in section 6 of this revenue procedure, the Ser-
2009–14 I.R.B.
vice will not challenge the following treatment by the qualified investor of a qualified loss—
(1) The loss is deducted as a theft loss;
(2) The taxable year in which the theft
was discovered within the meaning of
§ 165(e) is the discovery year described
in section 4.04 of this revenue procedure;
and
(3) The amount of the deduction is the
amount specified in section 5.02 of this
revenue procedure.
.02 Amount to be deducted. The amount
specified in this section 5.02 is calculated
as follows—
(1) Multiply the amount of the qualified
investment by—
(a) 95 percent, for a qualified investor
that does not pursue any potential thirdparty recovery; or
(b) 75 percent, for a qualified investor
that is pursuing or intends to pursue any
potential third-party recovery; and
(2) Subtract from this product the sum
of any actual recovery and any potential
insurance/SIPC recovery.
The amount of the deduction calculated
under this section 5.02 is not further reduced by potential direct recovery or potential third-party recovery.
.03 Future recoveries. The qualified
investor may have income or an additional deduction in a year subsequent to
the discovery year depending on the actual amount of the loss that is eventually
recovered. See § 1.165–1(d); Rev. Rul.
2009–9.
SECTION 6. PROCEDURE
.01 A qualified investor that uses the
safe harbor treatment described in section
5 of this revenue procedure must—
(1) Mark “Revenue Procedure
2009–20” at the top of the Form 4684, Casualties and Thefts, for the federal income
tax return for the discovery year. The
taxpayer must enter the “deductible theft
loss” amount from line 10 in Part II of
Appendix A of this revenue procedure on
line 34, section B, Part I, of the Form 4684
and should not complete the remainder of
section B, Part I, of the Form 4684;
(2) Complete and sign the statement
provided in Appendix A of this revenue
procedure; and
(3) Attach the executed statement provided in Appendix A of this revenue proce-
2009–14 I.R.B.
dure to the qualified investor’s timely filed
(including extensions) federal income tax
return for the discovery year. Notwithstanding the preceding sentence, if, before
April 17, 2009, the taxpayer has filed a return for the discovery year or an amended
return for a prior year that is inconsistent
with the safe harbor treatment provided by
this revenue procedure, the taxpayer must
indicate this fact on the executed statement
and must attach the statement to the return
(or amended return) for the discovery year
that is consistent with the safe harbor treatment provided by this revenue procedure
and that is filed on or before May 15, 2009.
.02 By executing the statement provided in Appendix A of this revenue
procedure, the taxpayer agrees—
(1) Not to deduct in the discovery year
any amount of the theft loss in excess of
the deduction permitted by section 5 of this
revenue procedure;
(2) Not to file returns or amended returns to exclude or recharacterize income
reported with respect to the investment arrangement in taxable years preceding the
discovery year;
(3) Not to apply the alternative computation in § 1341 with respect to the theft
loss deduction allowed by this revenue
procedure; and
(4) Not to apply the doctrine of equitable recoupment or the mitigation provisions in §§ 1311–1314 with respect to
income from the investment arrangement
that was reported in taxable years that are
otherwise barred by the period of limitations on filing a claim for refund under
§ 6511.
SECTION 7. EFFECTIVE DATE
This revenue procedure applies to
losses for which the discovery year is a
taxable year beginning after December 31,
2007.
SECTION 8. TAXPAYERS THAT
DO NOT USE THE SAFE HARBOR
TREATMENT PROVIDED BY THIS
REVENUE PROCEDURE
.01 A taxpayer that chooses not to apply
the safe harbor treatment provided by this
revenue procedure to a claimed theft loss
is subject to all of the generally applicable provisions governing the deductibility
of losses under § 165. For example, a tax-
751
payer seeking a theft loss deduction must
establish that the loss was from theft and
that the theft was discovered in the year
the taxpayer claims the deduction. The
taxpayer must also establish, through sufficient documentation, the amount of the
claimed loss and must establish that no
claim for reimbursement of any portion of
the loss exists with respect to which there
is a reasonable prospect of recovery in the
taxable year in which the taxpayer claims
the loss.
.02 A taxpayer that chooses not to apply
the safe harbor treatment of this revenue
procedure to a claimed theft loss and that
files or amends federal income tax returns
for years prior to the discovery year to
exclude amounts reported as income to the
taxpayer from the investment arrangement
must establish that the amounts sought to
be excluded in fact were not income that
was actually or constructively received by
the taxpayer (or accrued by the taxpayer,
in the case of a taxpayer using an accrual
method of accounting). However, provided a taxpayer can establish the amount
of net income from the investment arrangement that was reported and included
in the taxpayer’s gross income consistent
with information received from the specified fraudulent arrangement in taxable
years for which the period of limitation
on filing a claim for refund under § 6511
has expired, the Service will not challenge
the taxpayer’s inclusion of that amount in
basis for determining the amount of any
allowable theft loss, whether or not the
income was genuine.
.03 Returns claiming theft loss deductions from fraudulent investment arrangements are subject to examination by the
Service.
SECTION 9. PAPERWORK
REDUCTION ACT
The collection of information contained in this revenue procedure has been
reviewed and approved by the Office
of Management and Budget in accordance with the Paperwork Reduction Act
(44 U.S.C. 3507) under the following
control numbers: 1545–0074 Form 1040
(Individual Income Tax Return) and Form
1040X (Amended U.S. Individual Income
Tax Return); 1545–0123 Form 1120
(U.S. Corporation Income Tax Return);
1545–0132 Form 1120X (Amended
April 6, 2009
U.S. Corporation Income Tax Return);
1545–0092 Form 1041 (U.S. Income Tax
Return for Estates and Trusts); 1545–0099
Form 1065 (U.S. Return of Partnership
Income); 1545–0130 Form 1120S (U.S.
Income Tax Return for an S Corporation).
Please refer to the Paperwork Reduction
April 6, 2009
Act statements accompanying these forms
for further information.
DRAFTING INFORMATION
of Associate Chief Counsel (Income Tax
& Accounting). For further information
regarding this revenue procedure, contact
Ms. Rotunno at (202) 622–7900.
The principal author of this revenue
procedure is Norma Rotunno of the Office
752
2009–14 I.R.B.
APPENDIX A
Statement by Taxpayer Using the Procedures in Rev. Proc. 2009–20 to Determine a Theft Loss
Deduction Related to a Fraudulent Investment Arrangement
Part 1. Identification
1. Name of Taxpayer
2. Taxpayer Identification Number
Part II. Computation of deduction
(See Rev. Proc. 2009–20 for the definitions of the terms used in this worksheet.)
Line
Computation of Deductible Theft Loss Pursuant to Rev. Proc. 2009–20
1
Initial investment
2
Plus: Subsequent investments
3
Plus: Income reported in prior years
4
Less: Withdrawals
5
Total qualified investment (combine lines 1 through 4)
6
Percentage of qualified investment
(95% of line 5 for investors with no potential third-party recovery; 75% of line 5 for investors with
potential third-party recovery)
7
Actual recovery
8
Potential insurance/SIPC recovery
9
Total recoveries (add lines 7 and 8)
10
Deductible theft loss (line 6 minus line 9)
(
)
(
)
Part III. Required statements and declarations
1. I am claiming a theft loss deduction pursuant to Rev. Proc. 2009–20 from a specified fraudulent arrangement conducted by the
following individual or entity (provide the name, address, and taxpayer identification number (if known)).
2. I have written documentation to support the amounts reported in Part II of this document.
3. I am a qualified investor as defined in § 4.03 of Rev. Proc. 2009–20.
4. If I have determined the amount of my theft loss deduction under § 5.02(1)(a) of Rev. Proc. 2009–20, I declare that I have not
pursued and do not intend to pursue any potential third-party recovery, as that term is defined in § 4.10 of Rev. Proc. 2009–20.
5. If I have already filed a return or amended return that does not satisfy the conditions in § 6.02 of Rev. Proc 2009–20, I agree to
all adjustments or actions that are necessary to comply with those conditions. The tax year or years for which I filed the return(s)
or amended return(s) and the date(s) on which they were filed are as follows:
2009–14 I.R.B.
753
April 6, 2009
Part IV. Signature
I make the following agreements and declarations:
1. I agree to comply with the conditions and agreements set forth in Rev. Proc. 2009–20 and this document.
2. Under penalties of perjury, I declare that the information provided in Parts I-III of this document is, to the best of my
knowledge and belief, true, correct and complete.
Your signature here
Your spouse’s signature here
Date signed:
Date signed:
Corporate Name
Corporate Officer’s signature
Title
Date signed
Entity Name
S-corporation, Partnership, Limited Liability Company, Trust
Entity Officer’s signature
Date signed
Signature of executor
Date signed
April 6, 2009
754
2009–14 I.R.B.
Part IV. Items of General Interest
Request for Public
Comments Regarding Exempt
Organizations Division Web
Site
•
•
Do you use the Charities & Non-Profits Topics listed on the navigation bar
at the left side of the page? If not, are
there other topics that should be substituted?
•
What types of audience or role would
be the most helpful to you for organizing information?
• Level of sophistication (i.e., new
organizations and established organizations)
• Practitioners
• Managers and executives
• Types of tax-exempt organizations
•
What do you come to the irs.gov website to do?
• Find general information on staying tax-exempt
• Find a specific publication or
brochure
• Find step-by-step filing instructions
Announcement 2009–25
Purpose
This Announcement invites public
comments on how to improve the Internal
Revenue Service’s Exempt Organizations
Division Web site (www.irs.gov/eo).
Background
The Customer Education and Outreach
(CE&O) function of the Exempt Organizations Division (EO), Internal Revenue Service (IRS), is responsible for managing the
EO Web site (www.irs.gov/eo). CE&O has
found that, as the site has grown, displaying information in a logical and easy-touse format has become challenging.
In an effort to improve the Web site, the
IRS is seeking comments from the public
in two specific areas:
•
•
Reorganizing existing information to
make it easier to find.
Adding content that serve the needs of
tax-exempt organizations.
The public should consider the following questions when making comments:
•
•
How do you access the irs.gov web
site?
• Type in irs.gov as the URL
• Via a search engine (Google,
Yahoo, etc.)
• Through a bookmark, favorites, or
history view to reach a specific
page
• Do you have another preferred site
entry page? If so, what is it?
How do you find material on the site?
Do you use the irs.gov search engine?
• Do you go directly to the Charities
and Non-Profits page to browse?
• Do you use the Frequently Asked
Questions for Exempt Organizations?
• Do you use any of our Life Cycle
pages?
•
2009–14 I.R.B.
Do you use the More Topics page?
•
What topics or type of content should
be available to suit your needs?
•
Do you subscribe to the EO Update
electronic newsletter? If not, why? If
so:
• How did you learn about it?
• How can we expand our readership?
• What other content should be included?
Request for Comments
Members of the public may submit
comments by electronic message, by mail,
or by hand delivery. All comments should
refer to Announcement 2009–25, and may
be mailed to:
Internal Revenue Service
Attn: Amelia Henchey
CE&O, T:EO:CEO (3B6)
1111 Constitution Avenue, N.W.
Washington, DC 20224
Hand-delivered items may be delivered
Monday through Friday between the hours
of 8:00 a.m. and 5:00 p.m. to:
755
Courier’s Desk
Internal Revenue Service
1111 Constitution Ave., N.W.
Washington, DC 20224
Attn: Amelia Henchey
CE&O, T:EO:CEO (3B6)
Comments may be submitted electronically to:
EO.Web.Comments@irs.gov. Please include Announcement 2009–25 in the subject line of any electronic communications.
All comments will be available for public inspection and copying in their entirety.
Consideration will be given to any written
public comments that are received by May
25, 2009. EO regrets that it will be unable to respond individually to comments
or drafts.
Drafting Information
The principal author of this announcement is Amelia Henchey of Exempt
Organizations. For further information
regarding this announcement, contact
Amelia Henchey at 202–283–8856 (not a
toll-free call).
Request for Public Comments
on New Academic Institution
Initiative
Announcement 2009–26
The Customer Education and Outreach
(CE&O) function of the Exempt Organization division of the Internal Revenue Service (IRS) was established in 2000 to develop the strategic direction of the nationwide education and outreach programs for
exempt organizations. Specifically, this
office develops and delivers programs and
products designed to assist exempt organizations to better understand their tax responsibilities that are required by the Internal Revenue Code.
Many academic institutions offer degree programs that develop, cultivate, and
promote professionals who shape the exempt organization sector. The student populations of these academic institutions may
one day be the leaders and managers of the
exempt organizations that makeup the nonprofit sector. Hence, CE&O believes that
April 6, 2009
the students of these academic institutions
are an important audience to reach with education and outreach programs.
Therefore, CE&O is in the process of
developing a new academic program initiative that will reach out directly to academic institutions that offer degrees related to the non-profit sector. Through
the use of our existing tools and the possible development of additional resources,
CE&O proposes to collaborate with these
institutions to promote the education of exempt organization tax law.
The IRS invites comments and suggestions for the implementation and content
of the proposed initiative. First, the IRS is
requesting general responses to this initiative. Second, the IRS is seeking individuals and/or institution volunteers willing
to provide more extensive input into and
feedback on the proposed initiative. While
the IRS might not be able to accommodate
all volunteers, it will take steps to ensure
that a diverse range of viewpoints are represented.
The IRS invites interested members of
the public to submit written suggestions
to help shape this initiative. All submissions will be available for public inspection and copying in their entirety. Members of the public may submit suggestions
or drafts by email, mail, or hand-delivery.
All comments should refer to Announcement 2009–26, and may be mailed to:
Internal Revenue Service
Attn: Pilar Oberwetter
CE&O, T:EO:CEO (3D1)
1111 Constitution Avenue
Washington, DC 20224
Hand delivered items may be delivered
Monday through Friday between the hours
of 8:00 a.m. and 5:00 p.m., to:
Courier’s Desk
Internal Revenue Service
1111 Constitution Avenue, N.W.
Washington, D.C. 20224
Attn: Pilar Oberwetter
CE&O, T:EO:CEO (3D1)
Comments may be submitted electronically to: academic.initiative@irs.gov.
Please include Announcement 2009–26 in
the subject line of any electronic communications.
Exempt Organizations regrets that it
will be unable to respond individually
April 6, 2009
to suggestions or drafts. All comments
should be received by June 6, 2009.
DRAFTING INFORMATION
The principal author of this announcement is Pilar Oberwetter of Exempt
Organizations. For further information
regarding this announcement, contact
Pilar Oberwetter at (202) 283–8946 (not a
toll-free call).
Deletions From Cumulative
List of Organizations
Contributions to Which
are Deductible Under Section
170 of the Code
Announcement 2009–27
The Internal Revenue Service has revoked its determination that the organizations listed below qualify as organizations described in sections 501(c)(3) and
170(c)(2) of the Internal Revenue Code of
1986.
Generally, the Service will not disallow
deductions for contributions made to a
listed organization on or before the date
of announcement in the Internal Revenue
Bulletin that an organization no longer
qualifies. However, the Service is not
precluded from disallowing a deduction
for any contributions made after an organization ceases to qualify under section
170(c)(2) if the organization has not timely
filed a suit for declaratory judgment under
section 7428 and if the contributor (1) had
knowledge of the revocation of the ruling
or determination letter, (2) was aware that
such revocation was imminent, or (3) was
in part responsible for or was aware of the
activities or omissions of the organization
that brought about this revocation.
If on the other hand a suit for declaratory judgment has been timely filed, contributions from individuals and organizations described in section 170(c)(2) that
are otherwise allowable will continue to
be deductible. Protection under section
7428(c) would begin on April 6, 2009, and
would end on the date the court first determines that the organization is not described
in section 170(c)(2) as more particularly
set forth in section 7428(c)(1). For individual contributors, the maximum deduction protected is $1,000, with a husband
756
and wife treated as one contributor. This
benefit is not extended to any individual, in
whole or in part, for the acts or omissions
of the organization that were the basis for
revocation.
Rocky Mountain Big Horn Sheep
Foundation
Red River, MN
Skippers Learning Center
Lake City, SC
Reliable Cash Management Association
Buffalo Grove, IL
Pecan Park Learning Center
Jackson, MS
Brucker Charitable Foundation
Mountain Home, TX
N. U. Yoga Ashrama in America
Winter, WI
Housing Development Group
Denver, CO
National Business Fellowship Foundation
Raeford, NC
GIK Foundation
Bellevue, WA
Debt Free Foundation, Inc.
Provo, UT
Urban Light Community Development
Houston, TX
Sweet Life Program
Las Vegas, NV
Ladoras Family Services Inc
Compton, CA
Robert and Donna Herbolich Charitable
Supporting
Hudson, OH
Three Point Volunteer Fire Department,
Inc.
Williamsburg, KY
Advance Practice Foundation, Inc.
Basking Ridge, NJ
Goodwill Industries of Greater Cleveland,
Inc.
Cleveland, OH
World Project Inc.
Temecula, CA
Sandton Lifestyles
Los Angeles, CA
Dunn-Mason Foundation
Farmington Hills, MI
Walter E & Romell A King Foundation
Gary, IN
2009–14 I.R.B.
Withholding Under Internal
Revenue Code Section
3402(t); Hearing
Announcement 2009–29
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Notice of public hearing on proposed rulemaking.
SUMMARY: This document provides
notice of public hearing on a notice of
proposed rulemaking (REG–158747–06,
2009–4 I.R.B. 362) relating to withholding under section 3402(t) of the Internal
Revenue Code. The proposed regulations
reflect changes in the law made by the Tax
Increase Prevention and Reconciliation
Act of 2005 that require Federal, State,
and local government entities to withhold
income tax when making payments to
persons providing property or services.
These proposed regulations provide guidance to assist the government entities in
complying with section 3402(t). The regulations also provide certain guidance to
persons receiving payments for property
or services from government entities.
DATES: The public hearing is being held
on April 16, 2009, at 10 a.m. The IRS must
receive outlines of the topics to be discussed at the hearing by March 25, 2009.
2009–14 I.R.B.
ADDRESSES: The public hearing is being
held in the auditorium, Internal Revenue
Building, 1111 Constitution Avenue, NW,
Washington, DC. Send submissions to:
CC:PA:LPD:PR (REG–158747–06), room
5203, Internal Revenue Service, P.O. Box
7604, Ben Franklin Station, Washington, DC 20044. Submissions may be
hand-delivered Monday through Friday
between the hours of 8 a.m. and 4 p.m.
to CC:PA:LPD:PR (REG–158747–06),
Courier’s Desk, Internal Revenue Service,
1111 Constitution Avenue, NW, Washington, DC. Alternatively, taxpayers may
submit electronic outlines of oral comments via the Federal eRulemaking Portal
at http://www.regulations.gov.
FOR
FURTHER
INFORMATION
CONTACT: Concerning these proposed regulations, Jean Casey, (202)
622–6040; concerning submissions of
comments, the hearing, and/or to be
placed on the building access list to attend the hearing, Richard A. Hurst at
Richard.A.Hurst@irscounsel.treas.gov or
(202) 622–7180 (not toll-free numbers).
SUPPLEMENTARY INFORMATION:
The subject of the public hearing is
the notice of proposed rulemaking
(REG–158747–06) that was published in
the Federal Register on Friday, December 5, 2008 (73 FR 74082).
Persons, who wish to present oral comments at the hearing that submitted writ-
757
ten comments, must submit an outline of
the topics to be discussed and the amount
of time to be devoted to each topic (signed
original and eight (8) copies) by March 25,
2009.
A period of 10 minutes is allotted to
each person for presenting oral comments.
After the deadline for receiving outlines has passed, the IRS will prepare an
agenda containing the schedule of speakers. Copies of the agenda will be made
available, free of charge, at the hearing or
in the Freedom of Information Reading
Room (FOIA RR) (Room 1621) which
is located at the 11th and Pennsylvania
Avenue NW entrance, 1111 Constitution
Avenue, NW, Washington, DC.
Because of access restrictions, the IRS
will not admit visitors beyond the immediate entrance area more than 30 minutes
before the hearing starts. For information about having your name placed on the
building access list to attend the hearing,
see the FOR FURTHER INFORMATION
CONTACT section of this document.
LaNita Van Dyke,
Chief, Publications and
Regulations Branch,
Legal Processing Division,
Associate Chief Counsel
(Procedure and Administration).
(Filed by the Office of the Federal Register on March 18,
2009, 8:45 a.m., and published in the issue of the Federal
Register for March 19, 2009, 74 F.R. 11699)
April 6, 2009
Definition of Terms
Revenue rulings and revenue procedures
(hereinafter referred to as “rulings”) that
have an effect on previous rulings use the
following defined terms to describe the effect:
Amplified describes a situation where
no change is being made in a prior published position, but the prior position is being extended to apply to a variation of the
fact situation set forth therein. Thus, if
an earlier ruling held that a principle applied to A, and the new ruling holds that the
same principle also applies to B, the earlier
ruling is amplified. (Compare with modified, below).
Clarified is used in those instances
where the language in a prior ruling is being made clear because the language has
caused, or may cause, some confusion.
It is not used where a position in a prior
ruling is being changed.
Distinguished describes a situation
where a ruling mentions a previously published ruling and points out an essential
difference between them.
Modified is used where the substance
of a previously published position is being
changed. Thus, if a prior ruling held that a
principle applied to A but not to B, and the
new ruling holds that it applies to both A
and B, the prior ruling is modified because
it corrects a published position. (Compare
with amplified and clarified, above).
Obsoleted describes a previously published ruling that is not considered determinative with respect to future transactions. This term is most commonly used in
a ruling that lists previously published rulings that are obsoleted because of changes
in laws or regulations. A ruling may also
be obsoleted because the substance has
been included in regulations subsequently
adopted.
Revoked describes situations where the
position in the previously published ruling
is not correct and the correct position is
being stated in a new ruling.
Superseded describes a situation where
the new ruling does nothing more than restate the substance and situation of a previously published ruling (or rulings). Thus,
the term is used to republish under the
1986 Code and regulations the same position published under the 1939 Code and
regulations. The term is also used when
it is desired to republish in a single ruling a series of situations, names, etc., that
were previously published over a period of
time in separate rulings. If the new ruling does more than restate the substance
of a prior ruling, a combination of terms
is used. For example, modified and superseded describes a situation where the
substance of a previously published ruling
is being changed in part and is continued
without change in part and it is desired to
restate the valid portion of the previously
published ruling in a new ruling that is self
contained. In this case, the previously published ruling is first modified and then, as
modified, is superseded.
Supplemented is used in situations in
which a list, such as a list of the names of
countries, is published in a ruling and that
list is expanded by adding further names in
subsequent rulings. After the original ruling has been supplemented several times, a
new ruling may be published that includes
the list in the original ruling and the additions, and supersedes all prior rulings in
the series.
Suspended is used in rare situations to
show that the previous published rulings
will not be applied pending some future
action such as the issuance of new or
amended regulations, the outcome of cases
in litigation, or the outcome of a Service
study.
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.
Abbreviations
The following abbreviations in current use
and formerly used will appear in material
published 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.
April 6, 2009
i
2009–14 I.R.B.
Numerical Finding List1
Notices— Continued:
Treasury Decisions— Continued:
Bulletins 2009–1 through 2009–14
2009-22, 2009-14 I.R.B. 741
9436, 2009-3 I.R.B. 268
Announcements:
Proposed Regulations:
2009-1, 2009-1 I.R.B. 242
REG-144615-02, 2009-7 I.R.B. 561
9439, 2009-5 I.R.B. 416
2009-2, 2009-5 I.R.B. 424
REG-148568-04, 2009-5 I.R.B. 421
9440, 2009-5 I.R.B. 409
2009-3, 2009-6 I.R.B. 459
REG-160872-04, 2009-4 I.R.B. 358
9441, 2009-7 I.R.B. 460
2009-4, 2009-8 I.R.B. 597
REG-158747-06, 2009-4 I.R.B. 362
9442, 2009-6 I.R.B. 434
2009-5, 2009-8 I.R.B. 569
REG-116699-07, 2009-13 I.R.B. 727
9443, 2009-8 I.R.B. 564
2009-6, 2009-9 I.R.B. 643
REG-138326-07, 2009-9 I.R.B. 638
9444, 2009-9 I.R.B. 603
2009-7, 2009-10 I.R.B. 663
REG-143686-07, 2009-8 I.R.B. 579
9445, 2009-9 I.R.B. 635
2009-8, 2009-8 I.R.B. 598
REG-150670-07, 2009-4 I.R.B. 378
9446, 2009-9 I.R.B. 607
2009-9, 2009-9 I.R.B. 643
REG-113462-08, 2009-4 I.R.B. 379
9447, 2009-12 I.R.B. 694
2009-10, 2009-9 I.R.B. 644
REG-147636-08, 2009-9 I.R.B. 641
2009-11, 2009-10 I.R.B. 663
REG-150066-08, 2009-5 I.R.B. 423
2009-12, 2009-11 I.R.B. 686
Revenue Procedures:
9437, 2009-4 I.R.B. 341
9438, 2009-5 I.R.B. 387
2009-13, 2009-11 I.R.B. 686
2009-14, 2009-11 I.R.B. 687
2009-1, 2009-1 I.R.B. 1
2009-15, 2009-11 I.R.B. 687
2009-2, 2009-1 I.R.B. 87
2009-16, 2009-11 I.R.B. 691
2009-3, 2009-1 I.R.B. 107
2009-17, 2009-12 I.R.B. 714
2009-4, 2009-1 I.R.B. 118
2009-18, 2009-12 I.R.B. 714
2009-5, 2009-1 I.R.B. 161
2009-19, 2009-12 I.R.B. 715
2009-6, 2009-1 I.R.B. 189
2009-20, 2009-12 I.R.B. 716
2009-7, 2009-1 I.R.B. 226
2009-21, 2009-13 I.R.B. 730
2009-8, 2009-1 I.R.B. 229
2009-22, 2009-13 I.R.B. 731
2009-9, 2009-2 I.R.B. 256
2009-23, 2009-13 I.R.B. 731
2009-10, 2009-2 I.R.B. 267
2009-24, 2009-13 I.R.B. 732
2009-11, 2009-3 I.R.B. 313
2009-25, 2009-14 I.R.B. 755
2009-12, 2009-3 I.R.B. 321
2009-26, 2009-14 I.R.B. 755
2009-13, 2009-3 I.R.B. 323
2009-27, 2009-14 I.R.B. 756
2009-14, 2009-3 I.R.B. 324
2009-29, 2009-14 I.R.B. 757
2009-15, 2009-4 I.R.B. 356
Notices:
2009-16, 2009-6 I.R.B. 449
2009-17, 2009-7 I.R.B. 517
2009-1, 2009-2 I.R.B. 250
2009-18, 2009-11 I.R.B. 670
2009-2, 2009-4 I.R.B. 344
2009-19, 2009-14 I.R.B. 747
2009-3, 2009-2 I.R.B. 250
2009-20, 2009-14 I.R.B. 749
2009-4, 2009-2 I.R.B. 251
Revenue Rulings:
2009-5, 2009-3 I.R.B. 309
2009-6, 2009-3 I.R.B. 311
2009-1, 2009-2 I.R.B. 248
2009-7, 2009-3 I.R.B. 312
2009-2, 2009-2 I.R.B. 245
2009-8, 2009-4 I.R.B. 347
2009-3, 2009-5 I.R.B. 382
2009-9, 2009-5 I.R.B. 419
2009-4, 2009-5 I.R.B. 408
2009-10, 2009-5 I.R.B. 419
2009-5, 2009-6 I.R.B. 432
2009-11, 2009-5 I.R.B. 420
2009-6, 2009-12 I.R.B. 694
2009-12, 2009-6 I.R.B. 446
2009-7, 2009-13 I.R.B. 717
2009-13, 2009-6 I.R.B. 447
2009-8, 2009-10 I.R.B. 645
2009-14, 2009-7 I.R.B. 516
2009-9, 2009-14 I.R.B. 735
2009-15, 2009-6 I.R.B. 449
2009-10, 2009-14 I.R.B. 738
2009-16, 2009-8 I.R.B. 572
Tax Conventions:
2009-17, 2009-8 I.R.B. 575
2009-18, 2009-10 I.R.B. 648
2009-5, 2009-8 I.R.B. 569
2009-19, 2009-10 I.R.B. 660
Treasury Decisions:
2009-20, 2009-12 I.R.B. 711
2009-21, 2009-13 I.R.B. 724
9434, 2009-4 I.R.B. 339
9435, 2009-4 I.R.B. 333
1 A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2008–27 through 2008–52 is in Internal Revenue Bulletin
2008–52, dated December 29, 2008.
2009–14 I.R.B.
ii
April 6, 2009
Finding List of Current Actions on
Previously Published Items1
Bulletins 2009–1 through 2009–14
Notices:
Proposed Regulations— Continued:
Revenue Procedures— Continued:
REG-148326-05
2008-65
Corrected by
Amplified and supplemented by
Ann. 2009-14, 2009-11 I.R.B. 687
Rev. Proc. 2009-16, 2009-6 I.R.B. 449
REG-158747-06
2008-68
99-35
Hearing scheduled by
Amplified and superseded by
Obsoleted by
Ann. 2009-29, 2009-14 I.R.B. 757
Rev. Proc. 2009-15, 2009-4 I.R.B. 356
Notice 2009-15, 2009-6 I.R.B. 449
Revenue Procedures:
Revenue Rulings:
2007-17
65-286
Superseded by
Obsoleted by
Rev. Proc. 2009-14, 2009-3 I.R.B. 324
T.D. 9435, 2009-4 I.R.B. 333
2007-68
71-381
Superseded by
Obsoleted in part by
Rev. Proc. 2009-17, 2009-7 I.R.B. 517
Rev. Rul. 2009-9, 2009-14 I.R.B. 735
2007-71
76-54
Modified by
Obsoleted by
Notice 2009-3, 2009-2 I.R.B. 250
T.D. 9435, 2009-4 I.R.B. 333
2008-1
92-19
Superseded by
Supplemented by
Rev. Proc. 2009-1, 2009-1 I.R.B. 1
Rev. Rul. 2009-3, 2009-5 I.R.B. 382
2008-2
2008-19
Superseded by
Modified by
Rev. Proc. 2009-2, 2009-1 I.R.B. 87
Rev. Rul. 2009-3, 2009-5 I.R.B. 382
2008-3
Treasury Decisions:
2001-55
Modified by
Notice 2009-1, 2009-2 I.R.B. 250
2002-27
Modified by
Notice 2009-9, 2009-5 I.R.B. 419
2005-74
Obsoleted by
T.D. 9446, 2009-9 I.R.B. 607
2007-26
Modified by
Notice 2009-15, 2009-6 I.R.B. 449
2007-54
Obsoleted by
T.D. 9436, 2009-3 I.R.B. 268
2008-11
Obsoleted by
T.D. 9436, 2009-3 I.R.B. 268
2008-12
Obsoleted by
T.D. 9436, 2009-3 I.R.B. 268
Rev. Proc. 2009-11, 2009-3 I.R.B. 313
Superseded by
Rev. Proc. 2009-3, 2009-1 I.R.B. 107
Corrected by
2008-4
Ann. 2009-15, 2009-11 I.R.B. 687
Superseded by
Rev. Proc. 2009-4, 2009-1 I.R.B. 118
9439
Corrected by
2008-13
2008-5
Obsoleted by
Superseded by
T.D. 9436, 2009-3 I.R.B. 268
List of forms modified and superseded by
Rev. Proc. 2009-5, 2009-1 I.R.B. 161
Rev. Proc. 2009-11, 2009-3 I.R.B. 313
Modified and clarified by
Superseded by
Notice 2009-5, 2009-3 I.R.B. 309
9436
Ann. 2009-12, 2009-11 I.R.B. 686
9441
Corrected by
2008-6
Ann. 2009-18, 2009-12 I.R.B. 714
Rev. Proc. 2009-6, 2009-1 I.R.B. 189
9442
Corrected by
2008-7
Ann. 2009-13, 2009-11 I.R.B. 686
Ann. 2009-20, 2009-12 I.R.B. 716
2008-46
Superseded by
Obsoleted by
Rev. Proc. 2009-7, 2009-1 I.R.B. 226
T.D. 9436, 2009-3 I.R.B. 268
Rev. Proc. 2009-11, 2009-3 I.R.B. 313
2008-8
Corrected by
Superseded by
Ann. 2009-23, 2009-13 I.R.B. 731
2008-100
Amplified and superseded by
Notice 2009-14, 2009-7 I.R.B. 516
9446
Rev. Proc. 2009-8, 2009-1 I.R.B. 229
2008-9
Superseded by
Proposed Regulations:
Rev. Proc. 2009-9, 2009-2 I.R.B. 256
REG-144615-02
2008-17
Corrected by
Obsoleted in part by
Ann. 2009-19, 2009-12 I.R.B. 715
Rev. Proc. 2009-18, 2009-11 I.R.B. 670
REG-149519-03
2008-61
Withdrawn by
Superseded by
Ann. 2009-4, 2009-8 I.R.B. 597
Rev. Proc. 2009-3, 2009-1 I.R.B. 107
1 A cumulative list of current actions on previously published items in Internal Revenue Bulletins 2008–27 through 2008–52 is in Internal Revenue Bulletin 2008–52, dated December 29,
2008.
April 6, 2009
iii
2009–14 I.R.B.
INTERNAL REVENUE BULLETIN
The Introduction at the beginning of this issue describes the purpose and content of this publication. The weekly Internal Revenue
Bulletin is sold on a yearly subscription basis by the Superintendent of Documents. Current subscribers are notified by the Superintendent of Documents when their subscriptions must be renewed.
CUMULATIVE BULLETINS
The contents of this weekly Bulletin are consolidated semiannually into a permanent, indexed, Cumulative Bulletin. These are
sold on a single copy basis and are not included as part of the subscription to the Internal Revenue Bulletin. Subscribers to the weekly
Bulletin are notified when copies of the Cumulative Bulletin are available. Certain issues of Cumulative Bulletins are out of print
and are not available. Persons desiring available Cumulative Bulletins, which are listed on the reverse, may purchase them from the
Superintendent of Documents.
ACCESS THE INTERNAL REVENUE BULLETIN ON THE INTERNET
You may view the Internal Revenue Bulletin on the Internet at www.irs.gov. Select Businesses. Under Businesses Topics, select
More Topics. Then select Internal Revenue Bulletins.
INTERNAL REVENUE BULLETINS ON CD-ROM
Internal Revenue Bulletins are available annually as part of Publication 1796 (Tax Products CD-ROM). The CD-ROM can be
purchased from National Technical Information Service (NTIS) on the Internet at www.irs.gov/cdorders (discount for online orders)
or by calling 1-877-233-6767. The first release is available in mid-December and the final release is available in late January.
HOW TO ORDER
Check the publications and/or subscription(s) desired on the reverse, complete the order blank, enclose the proper remittance,
detach entire page, and mail to the Superintendent of Documents, P.O. Box 371954, Pittsburgh PA, 15250–7954. Please allow two to
six weeks, plus mailing time, for delivery.
WE WELCOME COMMENTS ABOUT THE INTERNAL
REVENUE BULLETIN
If you have comments concerning the format or production of the Internal Revenue Bulletin or suggestions for improving it, we
would be pleased to hear from you. You can email us your suggestions or comments through the IRS Internet Home Page (www.irs.gov)
or write to the IRS Bulletin Unit, SE:W:CAR:MP:T:T:SP, Washington, DC 20224.
Internal Revenue Service
Washington, DC 20224
Official Business
Penalty for Private Use, $300
| File Type | application/pdf |
| File Title | IRB 2009-14 (Rev. April 6, 2009) |
| Subject | Internal Revenue Bulletin |
| Author | SE:W:CAR:MP:T |
| File Modified | 2009-04-02 |
| File Created | 2009-04-01 |