80_FR_66624 80 FR 66415 - United States Property Held by Controlled Foreign Corporations in Transactions Involving Partnerships; Rents and Royalties Derived in the Active Conduct of a Trade or Business; Correction

80 FR 66415 - United States Property Held by Controlled Foreign Corporations in Transactions Involving Partnerships; Rents and Royalties Derived in the Active Conduct of a Trade or Business; Correction

DEPARTMENT OF THE TREASURY
Internal Revenue Service

Federal Register Volume 80, Issue 209 (October 29, 2015)

Page Range66415-66416
FR Document2015-27603

This document contains corrections to final and temporary regulations (TD 9733) that were published in the Federal Register on September 2, 2015 (80 FR 52976). The temporary regulations are regarding the treatment as United States property of property held by a controlled foreign corporation in connection with certain transactions involving partnerships.

Federal Register, Volume 80 Issue 209 (Thursday, October 29, 2015) 
[Federal Register Volume 80, Number 209 (Thursday, October 29, 2015)]
[Rules and Regulations]
[Pages 66415-66416]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-27603]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 9733]
RIN 1545-BJ49


United States Property Held by Controlled Foreign Corporations in 
Transactions Involving Partnerships; Rents and Royalties Derived in the 
Active Conduct of a Trade or Business; Correction

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final and temporary regulations; correcting amendment.

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SUMMARY: This document contains corrections to final and temporary 
regulations (TD 9733) that were published in the Federal Register on 
September 2, 2015 (80 FR 52976). The temporary regulations are 
regarding the treatment as United States property of

[[Page 66416]]

property held by a controlled foreign corporation in connection with 
certain transactions involving partnerships.

DATES: This correction is effective on October 29, 2015 and applicable 
beginning September 2, 2015.

FOR FURTHER INFORMATION CONTACT: Rose E. Jenkins at (202) 317-6934 (not 
a toll free number).

SUPPLEMENTARY INFORMATION:

Background

    The final and temporary regulations (TD 9733) that are the subject 
of this correction are under sections 954 and 956 of the Internal 
Revenue Code.

Need for Correction

    As published, the final and temporary regulations (TD 9733) contain 
errors that may prove to be misleading and are in need of 
clarification.

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Correction of Publication

    Accordingly, 26 CFR part 1 is corrected by making the following 
correcting amendments:

PART 1--INCOME TAXES

0
Paragraph 1. The authority citation for part 1 continues to read in 
part as follows:

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


0
Par. 2. Section 1.954-2T is amended by revising paragraph (a)(1) 
through (c)(1) introductory text, paragraph (c)(2)(iii) introductory 
text through (c)(2)(iii)(D), paragraph (c)(3) and (d)(1) introductory 
text, (d)(2)(iii) introductory text through (d)(2)(iii)(D), and the 
last sentence of paragraph (j) to read as follows:


Sec.  1.954-3T  Foreign personal holding company income (temporary).

    (a)(1) through (c)(1) introductory text [Reserved]. For further 
guidance, see Sec.  1.954-2(a)(1) through (c)(1) introductory text.
* * * * *
    (c)(2)(iii) introductory text through (c)(2)(iii)(D) [Reserved]. 
For further guidance, see Sec.  1.954-2(c)(2)(iii) introductory text 
through (c)(2)(iii)(D).
* * * * *
    (c)(3) and (d)(1) introductory text [Reserved]. For further 
guidance, see Sec.  1.954-2(c)(3) and (d)(1) introductory text.
* * * * *
    (d)(2)(iii) introductory text through (d)(2)(iii)(D) [Reserved]. 
For further guidance, see Sec.  1.954-2(d)(2)(iii) introductory text 
through (d)(2)(iii)(D).
* * * * *
    (j) * * * See Sec.  1.954-2(c)(1)(i), (c)(1)(iv), (c)(2)(ii), 
(c)(2)(iii), (d)(1)(i), (d)(1)(ii), (d)(2)(ii), and (d)(2)(iii), as 
contained in 26 CFR part 1 revised as of April 1, 2015, for rules 
applicable to rents or royalties, as applicable, received or accrued 
before September 1, 2015.
* * * * *

0
Par. 3. Section 1.956-1 is amended by revising paragraph (g) 
introductory text through (g)(3) to read as follows:


Sec.  1.956-1  Shareholder's pro rata share of a controlled foreign 
corporation's increase in earnings invested in United States property.

* * * * *
    (g) introductory text through (g)(3) [Reserved]. For further 
guidance, see Sec.  1.956-1T(g) introductory text through (g)(3).
* * * * *

0
Par. 4. Section 1.956-1T is amended by revising paragraph (b)(4)(ii), 
the third sentence of paragraph (b)(4)(iv) Example 1. (i), the first 
sentence of paragraph (b)(4)(iv) Example 3. (i), and paragraph (g)(1) 
to read as follows:


Sec.  1.956-1T  Shareholder's pro rata share of a controlled foreign 
corporation's increase in earnings invested in United States property 
(temporary).

* * * * *
    (b) * * *
    (4) * * *
    (ii) Control. For purposes of paragraphs (b)(4)(i)(B) and (C) of 
this section, a controlled foreign corporation controls a foreign 
corporation or partnership if the controlled foreign corporation and 
the other foreign corporation or partnership are related within the 
meaning of section 267(b) or section 707(b). For this purpose, in 
determining whether two corporations are members of the same controlled 
group under section 267(b)(3), a person is considered to own stock 
owned directly by such person, stock owned for the purposes of section 
1563(e)(1), and stock owned with the application of section 267(c).
* * * * *
    (iv) * * *
    Example 1. (i) * * * FS2 has no earnings and profits, and FS1 
has substantial accumulated earnings and profits. * * *
* * * * *
    Example 3. (i) * * * FS1 has $100x of post-1986 undisturbed 
earnings and profits and $100x post-1986 foreign income taxes, but 
does not have any cash. * * *
* * * * *
    (g) * * * (1) Paragraph (b)(4) of this section applies to taxable 
years of controlled foreign corporations ending on or after September 
1, 2015, and to taxable years of United States shareholders in which or 
with which such taxable years end, with respect to property acquired on 
or after September 1, 2015. See paragraph (b)(4) of Sec.  1.956-1T, as 
contained in 26 CFR part 1 revised as of April 1, 2015, for the rules 
applicable to taxable years of controlled foreign corporations ending 
before September 1, 2015, and property acquired before September 1, 
2015. For purposes of this paragraph (g)(1), a deemed exchange of 
property pursuant to section 1001 on or after September 1, 2015, 
constitutes an acquisition of the property on or after that date.
* * * * *

Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division, 
Associate Chief Counsel (Procedure and Administration).
[FR Doc. 2015-27603 Filed 10-28-15; 8:45 am]
BILLING CODE 4830-01-P

Federal Register / Vol. 80, No. 209 / Thursday, October 29, 2015 / Rules and Regulations 66415 the specifications found in the www.regulations.gov by searching for and additive regulations to add § 73.1530 Accomplishment Instructions of GippsAero locating Docket No. FAA–2014–1123. Spirulina extract (21 CFR 73.1530) to Mandatory Service Bulletin SB–GA8–2014– (6) You may view this service information provide for the safe use of spirulina 115, Issue 1, dated October 6, 2014, before that is incorporated by reference at the extract as a color additive in coating further flight, re-install the isolators to the National Archives and Records correct orientation, or if damage is found, Administration (NARA). For information on formulations applied to drug tablets and replace with airworthy parts. theavailability of this material at NARA, call capsules. 202–741–6030, or go to: http:// We gave interested persons until (g) Other FAA AD Provisions www.archives.gov/federal-register/cfr/ibr- September 21, 2015, to file objections or The following provisions also apply to this locations.html. requests for a hearing. We received no AD: Issued in Kansas City, Missouri, on objections or requests for a hearing on (1) Alternative Methods of Compliance the final rule. Therefore, we find that October 22, 2015. (AMOCs): The Manager, Standards Office, the effective date of the final rule that FAA, has the authority to approve AMOCs Melvin Johnson, published in the Federal Register of for this AD, if requested using the procedures Acting Manager, Small Airplane Directorate, Aircraft Certification Service. August 21, 2015, should be confirmed. found in 14 CFR 39.19. Send information to ATTN: Doug Rudolph, Aerospace Engineer, [FR Doc. 2015–27438 Filed 10–28–15; 8:45 am] List of Subjects in 21 CFR Part 73 FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; BILLING CODE 4910–13–P Color additives, Cosmetics, Drugs, telephone: (816) 329–4059; fax: (816) 329– Foods, Medical devices. 4090; email: doug.rudolph@faa.gov. Before Therefore, under the Federal Food, using any approved AMOC on any airplane DEPARTMENT OF HEALTH AND Drug, and Cosmetic Act (21 U.S.C. 321, to which the AMOC applies, notify your HUMAN SERVICES 341, 342, 343, 348, 351, 352, 355, 361, appropriate principal inspector (PI) in the 362, 371, 379e) and under authority FAA Flight Standards District Office (FSDO), Food and Drug Administration delegated to the Commissioner of Food or lacking a PI, your local FSDO. (2) Airworthy Product: For any requirement and Drugs, and redelegated to the 21 CFR Part 73 Director, Center for Food Safety and in this AD to obtain corrective actions from a manufacturer or other source, use these [Docket No. FDA–2014–C–1552] Applied Nutrition, we are giving notice actions if they are FAA-approved. Corrective that no objections or requests for a actions are considered FAA-approved if they Listing of Color Additives Exempt hearing were filed in response to the are approved by the State of Design Authority From Certification; Spirulina Extract; August 21, 2015, final rule. (or their delegated agent). You are required Confirmation of Effective Date Accordingly, the amendments issued to assure the product is airworthy before it thereby became effective September 22, is returned to service. AGENCY: Food and Drug Administration, 2015. (h) Related Information HHS. Dated: October 21, 2015. Refer to MCAI Civil Aviation Safety ACTION: Final rule; confirmation of Susan Bernard, Authority (CASA) AD No. AD/GA8/8, Amdt effective date. Director, Office of Regulations, Policy and 1, dated March 26, 2015. The MCAI can be Social Sciences, Center for Food Safety and found in the AD docket on the Internet at: SUMMARY: The Food and Drug Administration (FDA or we) is Applied Nutrition. http://www.regulations.gov/ confirming the effective date of [FR Doc. 2015–27369 Filed 10–28–15; 8:45 am] #!documentDetail;D=FAA-2014-1123-0007. September 22, 2015, for the final rule BILLING CODE 4164–01–P (i) Material Incorporated by Reference that appeared in the Federal Register of (1) The Director of the Federal Register August 21, 2015, and that amended the approved the incorporation by reference color additive regulations to expand the DEPARTMENT OF THE TREASURY (IBR) of the service information listed in this permitted use of spirulina extract as a paragraph under 5 U.S.C. 552(a) and 1 CFR Internal Revenue Service part 51. color additive to include use in coating (2) You must use this service information formulations applied to dietary as applicable to do the actions required by supplement and drug tablets and 26 CFR Part 1 this AD, unless the AD specifies otherwise. capsules. [TD 9733] (3) The following service information was DATES: Effective date of final rule RIN 1545–BJ49 approved for IBR on April 24, 2015 (80 FR 14810, March 20, 2015). published in the Federal Register of (i) GippsAero Mandatory Service Bulletin August 21, 2015 (80 FR 50762), United States Property Held by SB–GA8–2014–115, Issue 1, dated October 6, confirmed: September 22, 2015. Controlled Foreign Corporations in 2014. FOR FURTHER INFORMATION CONTACT: Transactions Involving Partnerships; (ii) Reserved. Molly A. Harry, Center for Food Safety Rents and Royalties Derived in the (4) For GippsAero service information and Applied Nutrition (HFS–265), Food Active Conduct of a Trade or identified in this AD, contact GA 8 Airvan Business; Correction and Drug Administration, 5100 Paint (Pty) Ltd, c/o GippsAero Pty Ltd, Attn: Technical Services, P.O. Box 881, Morwell Branch Pkwy., College Park, MD 20740– AGENCY: Internal Revenue Service (IRS), Victoria 3840, Australia; telephone: + 61 03 3835, 240–402–1075. Treasury. 5172 1200; fax: +61 03 5172 1201; email: SUPPLEMENTARY INFORMATION: In the ACTION: Final and temporary techpubs@gippsaero.com; Internet: http:// Federal Register of August 21, 2015 (80 www.gippsaero.com/customer-support/ regulations; correcting amendment. FR 50762), we amended the color technical-publications.aspx. additive regulations in § 73.530 This document contains rmajette on DSK7SPTVN1PROD with RULES SUMMARY: (5) You may view this service information Spirulina extract (21 CFR 73.530) to corrections to final and temporary at the FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For expand the permitted use of spirulina regulations (TD 9733) that were information on the availability of this extract as a color additive to include use published in the Federal Register on material at the FAA, call (816) 329–4148. In in coating formulations applied to September 2, 2015 (80 FR 52976). The addition, you can access this service dietary supplement tablets and temporary regulations are regarding the information on the Internet at http:// capsules. We also amended the color treatment as United States property of VerDate Sep<11>2014 13:13 Oct 28, 2015 Jkt 238001 PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 E:\FR\FM\29OCR1.SGM 29OCR1

66416 Federal Register / Vol. 80, No. 209 / Thursday, October 29, 2015 / Rules and Regulations property held by a controlled foreign guidance, see § 1.954–2(d)(2)(iii) (g) * * * (1) Paragraph (b)(4) of this corporation in connection with certain introductory text through (d)(2)(iii)(D). section applies to taxable years of transactions involving partnerships. * * * * * controlled foreign corporations ending DATES: This correction is effective on (j) * * * See § 1.954–2(c)(1)(i), on or after September 1, 2015, and to October 29, 2015 and applicable (c)(1)(iv), (c)(2)(ii), (c)(2)(iii), (d)(1)(i), taxable years of United States beginning September 2, 2015. (d)(1)(ii), (d)(2)(ii), and (d)(2)(iii), as shareholders in which or with which FOR FURTHER INFORMATION CONTACT: Rose contained in 26 CFR part 1 revised as of such taxable years end, with respect to E. Jenkins at (202) 317–6934 (not a toll April 1, 2015, for rules applicable to property acquired on or after September free number). rents or royalties, as applicable, 1, 2015. See paragraph (b)(4) of § 1.956– received or accrued before September 1, 1T, as contained in 26 CFR part 1 SUPPLEMENTARY INFORMATION: revised as of April 1, 2015, for the rules 2015. Background * * * * * applicable to taxable years of controlled foreign corporations ending before The final and temporary regulations ■ Par. 3. Section 1.956–1 is amended by September 1, 2015, and property (TD 9733) that are the subject of this revising paragraph (g) introductory text acquired before September 1, 2015. For correction are under sections 954 and through (g)(3) to read as follows: purposes of this paragraph (g)(1), a 956 of the Internal Revenue Code. deemed exchange of property pursuant § 1.956–1 Shareholder’s pro rata share of Need for Correction a controlled foreign corporation’s increase to section 1001 on or after September 1, in earnings invested in United States 2015, constitutes an acquisition of the As published, the final and temporary property. property on or after that date. regulations (TD 9733) contain errors that may prove to be misleading and are in * * * * * * * * * * need of clarification. (g) introductory text through (g)(3) Martin V. Franks, [Reserved]. For further guidance, see List of Subjects in 26 CFR Part 1 Chief, Publications and Regulations Branch, § 1.956–1T(g) introductory text through Legal Processing Division, Associate Chief Income taxes, Reporting and (g)(3). Counsel (Procedure and Administration). recordkeeping requirements. * * * * * [FR Doc. 2015–27603 Filed 10–28–15; 8:45 am] Correction of Publication ■ Par. 4. Section 1.956–1T is amended BILLING CODE 4830–01–P by revising paragraph (b)(4)(ii), the third Accordingly, 26 CFR part 1 is sentence of paragraph (b)(4)(iv) Example corrected by making the following 1. (i), the first sentence of paragraph DEPARTMENT OF THE TREASURY correcting amendments: (b)(4)(iv) Example 3. (i), and paragraph (g)(1) to read as follows: Internal Revenue Service PART 1—INCOME TAXES § 1.956–1T Shareholder’s pro rata share of 26 CFR Part 1 ■ Paragraph 1. The authority citation a controlled foreign corporation’s increase for part 1 continues to read in part as in earnings invested in United States [TD 9733] follows: property (temporary). Authority: 26 U.S.C. 7805 * * * * * * * * RIN 1545–BJ49 (b) * * * ■ Par. 2. Section 1.954–2T is amended (4) * * * United States Property Held by by revising paragraph (a)(1) through (ii) Control. For purposes of Controlled Foreign Corporations in (c)(1) introductory text, paragraph paragraphs (b)(4)(i)(B) and (C) of this Transactions Involving Partnerships; (c)(2)(iii) introductory text through section, a controlled foreign corporation Rents and Royalties Derived in the (c)(2)(iii)(D), paragraph (c)(3) and (d)(1) controls a foreign corporation or Active Conduct of a Trade or introductory text, (d)(2)(iii) introductory partnership if the controlled foreign Business; Correction text through (d)(2)(iii)(D), and the last corporation and the other foreign sentence of paragraph (j) to read as AGENCY: Internal Revenue Service (IRS), corporation or partnership are related Treasury. follows: within the meaning of section 267(b) or ACTION: Final and temporary § 1.954–3T Foreign personal holding section 707(b). For this purpose, in determining whether two corporations regulations; correction. company income (temporary). (a)(1) through (c)(1) introductory text are members of the same controlled SUMMARY: This document contains [Reserved]. For further guidance, see group under section 267(b)(3), a person corrections to final and temporary § 1.954–2(a)(1) through (c)(1) is considered to own stock owned regulations (TD 9733) that were introductory text. directly by such person, stock owned for published in the Federal Register on the purposes of section 1563(e)(1), and September 2, 2015 (80 FR 52976). The * * * * * stock owned with the application of temporary regulations are regarding the (c)(2)(iii) introductory text through section 267(c). treatment as United States property of (c)(2)(iii)(D) [Reserved]. For further guidance, see § 1.954–2(c)(2)(iii) * * * * * property held by a controlled foreign introductory text through (c)(2)(iii)(D). (iv) * * * corporation in connection with certain Example 1. (i) * * * FS2 has no earnings transactions involving partnerships. * * * * * and profits, and FS1 has substantial (c)(3) and (d)(1) introductory text DATES: This correction is effective on rmajette on DSK7SPTVN1PROD with RULES accumulated earnings and profits. * * * [Reserved]. For further guidance, see October 29, 2015 and applicable * * * * * beginning September 2, 2015. § 1.954–2(c)(3) and (d)(1) introductory Example 3. (i) * * * FS1 has $100x of text. post-1986 undisturbed earnings and profits FOR FURTHER INFORMATION CONTACT: Rose * * * * * and $100x post-1986 foreign income taxes, E. Jenkins at (202) 317–6934 (not a toll (d)(2)(iii) introductory text through but does not have any cash. * * * free number). (d)(2)(iii)(D) [Reserved]. For further * * * * * SUPPLEMENTARY INFORMATION: VerDate Sep<11>2014 13:13 Oct 28, 2015 Jkt 238001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\29OCR1.SGM 29OCR1


Document Created: 2015-12-14 15:21:11
Document Modified: 2015-12-14 15:21:11
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionRules and Regulations
ActionFinal and temporary regulations; correcting amendment.
DatesThis correction is effective on October 29, 2015 and applicable beginning September 2, 2015.
ContactRose E. Jenkins at (202) 317-6934 (not a toll free number).
FR Citation80 FR 66415 
RIN Number1545-BJ49
CFR AssociatedIncome Taxes and Reporting and Recordkeeping Requirements
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