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CFR Citation: 26 CFR Part 1

RIN ID: RIN 1545-BE77

REG ID: [REG-164965-04]

NOTICE: PROPOSED RULES

DOCUMENT ACTION: Notice of proposed rulemaking by cross-reference to temporary regulations.

SUBJECT CATEGORY: Elections Regarding Start-Up Expenditures, Corporation Organizational Expenditures, and Partnership Organizational Expenses

DATES: Comments or a request for a public hearing must be received by October 6, 2008.

DOCUMENT SUMMARY: In the Rules and Regulations section of this issue of the Federal Register, the IRS is issuing temporary regulations relating to the elections to deduct startup expenditures under section 195 of the Internal Revenue Code (Code), organizational expenditures of corporations under section 248, and organizational expenses of partnerships under section 709. The American Jobs Creation Act of 2004 amended these three sections of the Code to provide similar rules for deducting these types of expenses that are paid or incurred after October 22, 2004. The regulations affect taxpayers that pay or incur these expenses and provide guidance on how to elect to deduct the expenses in accordance with the new rules. The text of those [[Page 38941]]
temporary regulations also serves as the text of these proposed regulations.

SUMMARY: Elections Regarding Start-up Expenditures, Corporation Organizational Expenditures and Partnership Organizational Expenses,

SUPPLEMENTAL INFORMATION

Temporary regulations in the Rules and Regulations section of this issue of the Federal Register amend the Income Tax Regulations (26 CFR Part 1) to implement the changes to sections 195, 248, and 709 of the Code made by section 902 of the American Jobs Creation Act of 2004, Public Law 108357 (118 Stat. 1418). The text of those temporary regulations also serves as the text of these proposed regulations. The preamble to the temporary regulations explains the amendments. Special Analyses

This notice of proposed rulemaking is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. Because the regulations do not impose a collection of information on small entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply. Pursuant to section 7805(f) of the Code, this regulation has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.

Comments and Requests for a Public Hearing

Before these proposed regulations are adopted as final regulations, consideration will be given to any written comments (a signed original and eight (8) copies) or electronic comments that are submitted timely to the IRS. The IRS and the Treasury Department request comments on the clarity of the proposed rules and how they can be made easier to understand. All comments will be available for public inspection and copying.

A public hearing will be scheduled if requested in writing by any person that timely submits comments. If a public hearing is scheduled, notice of the date, time and place for the hearing will be published in the Federal Register.

Drafting Information

The principal author of these regulations is Grace Matuszeski of the Office of the Associate Chief Counsel (Income Tax & Accounting). However, other personnel from the IRS and Treasury Department participated in their development.

List of Subjects in 26 CFR Part 1

Income taxes, Reporting and recordkeeping requirements. Proposed Amendments to the Regulations

Accordingly, 26 CFR part 1 is proposed to be amended as follows: PART 1INCOME TAXES

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

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

Par. 2. Section 1.1951 is revised to read as follows: Sec. 1.1951 Election to amortize startup expenditures.
[The text of this section is the same as the text of Sec. 1.195 1T(a) through (d) published elsewhere in this issue of the Federal Register.]

Par. 3. Section 1.2481 is amended by revising paragraphs (a) and (c), and adding paragraphs (d) through (f), to read as follows: Sec. 1.2481 Election to amortize organizational expenditures. (a) [The text of this proposed amendment to Sec. 1.2481(a) is the same as the text of Sec. 1.2481T(a) published elsewhere in this issue of the Federal Register.]
* * * * *
(c) through (f) [The text of these proposed amendments to Sec. 1.2481(c) through (f) are the same as the text of Sec. 1.2481T(c) through (f) published elsewhere in this issue of the Federal Register.]

Par. 4. Section 1.7091 is amended by revising the section heading and paragraph (b) to read as follows:
Sec. 1.7091 Treatment of organizational expenses and syndication costs.
* * * * *
(b) [The text of this proposed amendment to Sec. 1.7091(b) is the same as the text of Sec. 1.7091T(b)(1) through (b)(5) published elsewhere in this issue of the Federal Register.]
Linda E. Stiff,
Deputy Commissioner for Services and Enforcement.
[FR Doc. E815457 Filed 7708; 8:45 am]
BILLING CODE 483001P

FOR FURTHER INFORMATION CONTACT Concerning the proposed regulations, Grace Matuszeski, (202) 6227900; concerning submission of comments or a request for a public hearing, Richard Hurst, at
Richard.A.Hurst@irscounsel.treas.gov or (202) 6227180 (not tollfree numbers).