Final_TD7611

~ a d r r d~ & ! s r j Vo]. I.C
- .

No

Fridsy. A p d 20, 1WB f Rdtn .rind Rcgulatimm

78

D5lQ

1

#

'
I

1,At 4327031,mdd t b e pmtotype per
will be published iIthe Department .
determines h a ; acceptance 01 h . . . . unit cost~chedderlor deiachedlserni' detached, row, walk*~?and elevator, :
- ~ o m e n is-appropriate.
@
Cornmenb
-l dwellings ar shown on rhe hototfle P e f .
with &sPect lo cost limits forB
. siven :
l o c a ~ o nshould be sent t o ihe address
Unit CostScheduIee. Region Vfl.Sa~+~
Fox. within .!he existing Cedar Rapidr
indicated above,
.. A F i n w nf ~ n a ~ ~ l i t a b i l i t ~ ' r e aprolotype
~em
area. Tbese schedules are
. t h e Nationd'hvimmentaI Policy Act
..es,bblishcdfota special Lndian
.01 1969 has been mede in accordance
-prolot~?ec ~ s rarea Ipaarsnant t o & CFR
w i h H I D procedures. A cop), of this
80523 31, and apply od y Ior the - . "
Findirq QI Inapplicability will be ..
developmeni of h&an Housiq
. .
under 2 4
availabre ior public inspection during
CFR. Part '605.
-2. At 43 F R 2 7 0 5 3 , revise t h e protolype
repdar business hours in the Office ol
- - '
per u n i t cost schedules lor
the Rules Docket Clerk,Office oft h e .
General Counael, Room 5218,4517th.: dwellings as shorn-on !he per
cost
S 3 e k i .S.WI Wasluagton D.C.20410..
schedules. RegionK. Seal tle. Part
AccordingIy, the protot~peper unit
Angeles,Tdaola.hngview and
cost schedules issued under 24 CFR, Part Aberdeen, Washington.
3.At43 FR 27054, revise t h e prototype
841. Appendix A. Prototfie Cost Limits
.
- per unit co&achedules for row
for Low-Income Public Housing, are
dwellings as sbLown.onthe lper unii cosl
amended as follows:
'

-

'

'

Reglon VI1

-.
o

2

1

4

3

5

,

schedule*. Region X Olympia, "Iahma
and Nespelem ,washington. :, ;. . .:(k.
rid),Department mf fIUD hd42US.C.
353S(d): SCC qb). U S .&owing Act d,ls37. .
14371dll. .. -:...- . . . .:.l;,: . .:...::

-"Gened At ~ a s h i r y b h anAprilII,-:
~.~.
1978. .

. ... . . . . . . .

~-as-

.

,

,

.

.

,

.

.

.

Hwaiw
-. .

rA "i ~mr M
. '*nr~fmH
. a. r.c .~ *

[DOC~;C~~O.R-zwsy
.

.

.

nied C I C ~&*5.aj

~a

SILUMG MOE *ZIWI-M.

.

.

.

DEPARTMENP.OF'HOUSING AND
URPAH'DEVELOPMEHT ' ' ' '
,

.-;

I

.

,

.

,

.

.-

<

A

FederaI Insuranw Administration
24

CFR Part

-

1917

Finat FIdod levat ti on Determination
for the Village of Czsco, Kewaunee
County, Wis.

Correction
h FR Doc. '7S7540, published at page
15697. onTbu;sday, March 15.1979,in
the third column, the '?myear flood
elevation table" sbould'be corrected to
.read as follows:

,

Region X

-.

b

Gee*

WDslR7-Y
>dl -r?sun

CmS.--

h
h
m -earn-b

C h d

h
A v e ~

'

.m
710
313

A*.-hTr

?:.

RhwkYd
N w C w n ~ e L n m -

110

wrww uld v:tsrsn

w
. hA b . i m
...

-

.

I
.
I O . ~
W*%----..-...-....--L---,..---.---.I------W S ~ u w t
...

.:

..,. ;,

I
-b
-lA
R a
wh,

ZLMP

t6.m

.

w

..-.--....-.-u--

....

'14.450

... ................................

17-

35.m

.
2

,
2
5
m
31BW

34.-

BILLING C O D E 1 5 0 - 3 4

37.~0

........
.-... ,

.

.........

JIB54

--X
m

-.-.

DEPARTMENT OF THE TREASURY
internal Revenue Service
26 CFR Parl 1

TO

7b!I

Income Tax; Nonbank Trustees of
P e n s i ~ nand Prollt-Sharing Trusts
BeneliUng Owner-Employees
AGENCY: hternal Revenue Service.
Treasury.
ACTION: Final regulations.

This documen! provides final
regulations relaling to he approval o l
SUMMARY:

-bT

w. A %-w
b

-

.

..-.--...

........ ..,:. .....

15.200

l a 300

22 6 S

tSW

. 32.-

36.PYI

...

37.700

-

-----

f

- --

_

..-

.

..._.

.

.._
. _. .

-

_

.

-

+ ..

-.

. --

-

specified financial institu:ions that
Paragraph 1. Paragraph ( a ] of thc
accept trust assets soIe1y-forinvesment , 11.4M-12 is smended by deleting the
l a s t senlence and inseriing two new
, in their insured deposits arr. sentences in Ireu hereof lo read as .
: auiornatically approved withou't filing an
follows:
spplication. This change conforms to
amendments made to h e temporary
- f 1.101-12 Rtqulremtntr tor qvalltiatlon
regulations. ' '
ot t u s t r and plans btnetltlng ormtrThe pioposed regulalioni required all
tmstees to
with a
lnlroduc!jon. *
' Excep! as
worth requiremen[ designed to increase . olhemise provided, paragraphs @]
.
...
- as the value of the assets held in trust
December 31, 1975.
(m)of hissection apply to
increased. T h e final regulations adopt a
taxable years beginning after December
FOR FURTHER 1HFORMATION COHTACT:
less stringent rule for "passive trustees"
31,Ig62,
George Baker of he Employee Pian& and as
("1 this Section
in the rrguistio?s. ,
applies to plan years determined in
Exempt Organizations Division. Office
The final regulationa also provide two accordance wirh p a g r a p h (n)tr) of this
of the Chief Counsel, lniernal Revenue
by which the
section:.
Service, 1111 C o n s t i t u t ~ o nAvenue, NW.,
0.c.10224 (
~
~ . ~ applicant
~
~ may~ demonstrate
i
~ sufficient
~
:
Par. 2.Paragraph [c)(f)(i)of $ 1.401-12
CC:tR:T:&12-7&: (20:-56&3g38)
(not a diversity of ownership. A c o r ~ o r a t i o n
is amended to read as follows:
toll-frte,number).
required to register with the Securiti-es
_ - -. -. . ...
and Exchange Commission under
g 1.401-12 Requirements for qualification
SUPPLEMEHTARY IMFORMATIOH:
section 12[b) of the Securities Exchange
or trusts and plans benelltlng ownerBackground
Ac1 of 1934 i s deemed diversified, as is
tmployter.
,
.
* . -.. . , *.
' .
- an N'b-owned subsidiary oC sucha.
---On October 16.1975, the Federal torpors tion.
(c] Bonk trustee. (I][i)~ f - arust
Regisler published proposed
The final regulations add a
created afier October 9.1962,is to form '
amendments to the Income Tax requirement that the applicant notify the a part of a qualified pension or profitRegulations (26 CFR Part 1) under
edrninistraior of a plan that the ' ,
sharing-plan covering an ownersection 401 of the Internal Revenue
applicant has been approved by the
employee, or if a trusl created before
Code
o f 1954 were-proposed
(40 FR 48514). The
amendments
to conform - Gommissioner before accepting trust. Oc10.1962.but not excmpl from
assets. This provision will not be fully
tax on October 9, 1962. is to form part of
the regulations 10 the provisions of
effect11-efor six months, but the
such a plan, the trustee of such trust
.section 1022 [eland If)of the Emdoyee gdminislralors of accr?2nlsaccepred - -- -m'us!beFa b-ank as defined i.1 paragraph
Retirement Income Security Act of 1974
before h a t time must be nptified by ihat
[c)!2) of this section, unless en exception
("ERISA") (68Stat. 939, 940). A:ter
time or, if later, rcrithin si.?months after
contained in paragraph [c){4) of this
consideration of aH corrments regarding
a c c e p t a n c ~of the account. .
sectjon applies. or paragraph [n) of [his ,
the proposed amendments, those
section applies.
The final r e f i a t i o n s
amendments are Adopted as revised by
new procedural a n d administrative
Par.3. Paragraph [cj(Z)(iii) of f 1 . ~ 3 1 this Treasury decision.
rules, includmg rules u_nder.which the -. 12 is amendedby substi~u:ir-ga
~ ~ ~ r ofnP ~~; s~o o asother
l
Than Banks
Internal Revenue Service may revoke
semicolon for the period a, the end
a s T ~ s t e e sof Trust5 Benefiting Ownerthe approval of an applicant. The i m a l
hereof.
Employees
regulations supersede 6 11.401[d1(11-1 of
Par. 4. Paragraph (c)i2){iv) of 5 1.301. Section 1022(c) of W S A
a
the Temporary Income Tax Regulations
12 is added t o read as follorvs:
Under the ErnpIoyee Retirement Income .
that is not a b a d to be a hstee
5 1.401~12 Requirements for q'uaf~lrcation
Security Act 0f1g74h
of a qualified p e n s i ~ nor profit-sharing
of trusts and plans benefiting owncrmst benefiting owner-employees if the
DraFbg l ~- -f o r m ~ ~ o n
empjoyees. .
. person demonskates to the satisfaction
. * . . .
The principal author of these
of the Commissioner lhat it will
administer h e trust in a manner
regulations was George Baker of the
(~j*..',
(2)
Employee Plans and Exempt
consistent with the law.
[ivj Beginning on Januav 1. 1974. an
Organizatjons Division of the Office of
nefinal regulations
hat this
insured credit union (within the m e r n i y
.Chief C o w ~ e llnternal
,
Revenue
demonstration be made by mitten
of section 101 [6)o f t h e Federal Crcdil
Service. Howeve:, personnel from other
apallcalion. The applicant must exhibit
Uni"
f 2 U.S.C. 1752 (611.
afficrs
uf
the
Internal
Revenue
Service
.
at:r,r)u t e s such a s c o n t l n u , t y ,
Par. 5. Paragraph (n) of 5 1,401-12 rs
and
Department ~ a r f i c i ~ a f e d
location. and lir,ancial responsibility. It
- ,added twread as lollows:
in developing [he regurations,both on
must demonstrare experience and
matters
of
substance
a
n
d
style.
cornpelence in acting as a fiduciary, in
5 1.401-IF Requlrtments for qua\iftcation
accounting for the r n l e r e s t s or a large
- , - - o! tru$s and plans-benefiting owncrAJoprjiln domendmenu
ro
n u m b e r of individuals. and in engaging
mgujotrons
employees.
in other ectiuities normally associated
*
with the handling of retircrnent funds. In
Acc0rdlngl~- - - .. .- dn) Nonbonk trustee-[I) Effecri~.c
addition, the applicant must
1. T h e proposed amendment of
dales--(i) Generalrule. For a plan not in
demonstrate that jl is prepared l o
5 1.407. 8 5 Set forth in paragraph 1 of h e e x i ~ t e n c eon January 1.1974. lhts
comply with s p e c i r j ~ drules of F~duciary nolice of proposed rulemaking of
-. .
paragraph shall apply to the firs1 pldm
conduct.
October 16.1975. i s wi~hdrawfi.
year commencing after September 2 .
T h e final regulalions ~ r o v ~ d eby
d this
2. The ~ t h t Bmendments
r
to 26 CFR
1974, and all subsequent plan years.
document differ rn part Irorn the
Part 1 are hereby adopted subject 10 the
(illExist,ng plans. For a plan in
proposed regulations. F i r s l . certain
changes indicated-beiaw: -exlslence on Januery 1,1974, this

nonbank trustees or pension and profrlsharing plans benefiting owneremployees. Changes to the applicable
. t ~ x --were
1 ~ made
~
by the Employee - .
Retirement lncome Security Act of 1974.
T h e s e regulaiion6 provide the public
,:with p i d a n c e concerning approval and
conduct of lrustees other than banks.
. - DATE: The replations are generally . '
effective for plan years beginning alter
-

.

z

. . .

i

rdtrd utgirter /-voLY Ne

rs 1 PAday. Aptil

20. 1WB

! Ruler and
. - -

~ran

(2)In&ividu& each .of
owm
paregaph ;&hallapply 4 0 the h a !
more ,han2Op-ent of h e apital
year rnmmencing af~er.De;en-rberSL .
1 9 7 and
~ dl slrbseque~tplan years. .
in~er-emtin he partnership own& b e .
12) J,, ge~nemiForplan gears to whi& -aggr!p te, no more than 5 0 percent of
this paragraphapplies. t h e , t r u s ~ e e o l s such capiteIinterest ,.
. ..
E o r p w ~ e s oLf~ L eubdivis&r,
B
..
tms: aes&bed nn paragraphJc][l)[j] of
theo ~ n e r s h i ~ a i - s t o cand
k .ofcapital this s e c L i ~ may
n
be a persgn oiherthan
and3mRtr h1e:ests shall .bedetermined
e bank if .thepetson demonstrater 10 h e
of IheCommissioner that '
in a c c o r d m ~
withihenlesfor
constructivero~n~ship
of atack .
the manner in ~ h i c hthe peraon will .:
administer ,trus!r will % e cornistent with provida id sec;ion 1563 le).and (Q42:.
For .this purpose. & e i d e r for
t h e ~ ~ u i r e m e n ! s , oseclion
f
401 The
conslrucli~e~ownemhipoi
stock
person m u s t .denunsu-ate by w ~ i t l e n
provided &:section 15631e):and (0 JZ]
application thal t h e requirements of
shall.apply to .a cagital or profik intereet
paraFaphJn){3j to (74 nf &s section
i n a p a r k e r a h i p as i f i t were o stock
will be met. Tht .written applicalion

'

m u s .be
~ sent t o he Commissianer of

I n ~ e m aRevenue.
l
Attention: E:EP.
lntemal Revenuesenice, Nashingbn
D.C. 20224. For procedural,mid .
administrative d e s , d e e parzgmph
[ n ) f B ) vf this section.
(31 fidu&,~obility.

The applicant

must demonstrate in~detailits ability :o
act within h e accepted d : s of
*

'

interest
. (ii)EstobLished locoribn. ?he
applicant must have an established
place of business in the United States
where i t i s sccessible during every
busicess day.
+
(iii) I j ' d u u o y ~ x p e r i e n cThe
~.

.

'

23521

Kcgule!ion~

can?elence with ~ e s ~ eioc other
t
. , ,
e~tj~i-iiesnorma~yasso~ated
wilh the.
handling af ~ e ~ i r e m eiunds.
nt
. .

--

{ii) Eronplcr- Examples ol activities

normally associated with h e ,handin; .
of retirmenl lunds include: - .-

'-,

{A] T O~ e c e i v i . i s s u ereceipte lot-arid

.safely keep srcx-ities: .. . . . .. . . . .
[B)To collect incomc
..
IC)Toexecute such ownerahip
certiFcales. lo keep such T ~ C D I ~ Emake'
,
such relurns,.wdsender .such
statements as are requiredforS'edcra;
tax pmposes;
. 1D) To giv.e proper natifica tion

r e g a r d q .all co;lecfionr;;
[ElT o E ~ I Cmatured
CI
mrrrtrlled
prin cipnl: and properly report all .such
collections;
Iq To exchange lerrgorery lor d e f i i tive securities;.
[GITa give proper notkcation 01
calls. subscriplisn rights, ddaulis .in
principal or interest and &the brmatiun
of pta!ectivc committees;
(Hj T o buy. sell, receive, or,deliv.er
securities on specific directions.
46) Rules sffiduu'ary corducL,The
apphcant ,must demonstrate that under
applifa ble regulator). requimrncnt~.
corporate or,othergowerning
.
instruments. or its established-operating
procedures:
{ij Pdministralion ofJiducrary
powers. ( A ) ( I T) h e owners nr directors

applicant must have fiduciav
experience ~r.expertise
sufficiexit to
cnsurc .tb a1 it will heable to perform its
fiducia;y . c n n d ~ i ASuch
.
demonstration
must include the ioIlowFingele~nentso l
. fiduciary duties. Ev.idence of f i d u c i q
- .
experiencemusl include p m ~ &fthat e
prow': - :
sjgnificsnl part -01the business .ofthe
( i ) Conti,~urty.(A) The appl~canlmust
assme the ,unintefiptedperforxance o f applicant consistsaf~xercising
its f i d ~ c i a t y d u f i e s ~ n o n t r < & ~ t a n & q ' t hfiduciary
e
powers similar4oihose i t will
exercise if its application is approved.
d e a a w ch8ngeu.fiits owners. Thus, for
exarcple;lthere must be sutficient
Evidence .of fiduciaq expertise must
cltversity-in theownership of the
.
include prool.that &the applica4t employs
personnei expmenced in tlse apcli$nt 'to e n s u e thai t h e dealh ~r
admiriistration.offiduciaryponrers
ch&ejo'f its.o&ei-s will no1 intempt
of he applicant will beresponsible for
siniler to those the -appIicantwill
dye w n d u c t of 'itn business. Xerefcre,
the proper exercise ,offidudary powers
the*? licant carsno1 be an ~ndlvidual.
exercise if its applicationjs approwd.
by t h e applicant Thus,aLl matters
(iv) F , d u c i q rcsporrsililitq. T h c
pertu~crltthcrrkc, indu&ng the
~ ~ A b c i e n ~ d i inv the
~ r s ~ ~
owner&$ of an incorporaIed applicant
zpplicant must assure compliance with
d e t e h a h o n .ofpolicies, h e inveskment
is dkrnoniitrated in the follon-jng
the d e s OF fiduciery conduct set out in
and disposi!ion of property held in a
circurnstances:
~arag:apbjn)[6] ofrhis section.
fiduciary capacity. and the direction and
:(~)lndividuals
each oi,whom owns
r e n e w of the actionc or ali ernptoyees
( v ] ,r~nonciol'r~sponsibilirJ,.The
more than 2U percent of the vc8:ing stock
applicant m u t exhibit.8 high degree 0.:
utilized by h e applicant : i the exercise
in herrpplicanl own, in-the,aggrr.gate,
solvency commensurate with the
of i t s Fiducian powers, will be the
no more ihan 50 percent of such stock:
obligations imposed .by h s paragraph,
responsibil~tyof ihe owners or directors.
Among t h e fectors to be taken ,into
In dicharging :thisresponsibiiity, t h e
, (2)T I e applicant has issued securities
registsred undbr seclion 1 2 (b)of b e
~ C C U U ; L I art. the applicanl'r net worth, I ~ S ownels or directors may zssign to
Securities Exchange Act of 1934 (15
Lquid;b,andits ability t o pay -ibaebb
d e s ~nated employees. by action duly
U.S.C 781 {b]]or required to be
as they come d u e r-coi ded. ~e administration o f s u c h of
regislered under section lz(g) (11 of thal
(4) Copocifyto.occounl The-applicant t h e applicznt's Aduciary powers as may
Act (I5U S . C 78: .[g)(3)?: or
must d e m o n s t r ~ in
t ~ detail it5
. be proper to nssign
(3)The applicant has a parant
experience and competence with respec1
[i') A written-record will be made of
corporation wt1n.n the mearing of
to accounting for the inlerests of a large
the a cceptancc and af ihe
section 1563 ,[a] 41) that has ~ssued
number of individuals!(mcludi
,relinquishment pr closing out of all
securities registered under section 12 (b]
calculating and allocating income
fiduciary accounls, a n d of the assels
of & c Securities Exctrd~igeAct of 1934
earned and paying outad16tribution6 to
held for each account.
(15 U3.C. 781 (b)] or required to be
peyees). Erampleg of accounting for the
(31If the applicant has the authority or
regislered under Section 1 2 (g) ( I ) of rhnt inlerests 01 a iargenurnber or
h e responsibility to render any
Acl (IS U.S.C. 781 (g)[l)).
individuals include accounting for the
i n v e s b e n i advice with rega:d to the
intcrests o f a large nurnbm of
IC) Sufficient d i v e r s i ~ yin l h ~
asst.13 held iu u r f o r each fiduciary
orcnetshipaf an a p p l ~ c a n lt h a t is a
shareholders in a regula red mveslmen!
account the advirabillty of rrtainiq clr
oartlership means thatcompany and accounting for the
disposing of h c assets will be
1 7 ) ladividuals esch a l whom awns
inlerests of a,large number ot va:iable
deterrined st feast once during each '
more lban 20 percenl ~f the p r ~ f i i s
annuity contract holders.
period of 12 m o n t i t .
:nrerest ~n1he partnership own. in the
( 5 ) ELlness do 3~ndleJunds-(i]In
[B)All employee&laking pan in the
i g r e g a t e , no more than 50 p;rcent of
penem,! T h e applicant,must
periormence of the applicanr'r, fiduciary.
;gch pro!& inlerest, and
.
.. ,
demonstrate in detail i t s expxience and
duties will be adequately bonded.

-