18384 Federal Register / Vol. 76, No. 64 / Monday, April 4, 2011 / Rules and Regulations 

Regulatory Flexibility Act 

We certify that this final rule will not 

have a significant economic impact on 

a substantial number of small entities as 

it affects individuals only. Therefore, a 

regulatory flexibility analysis is not 

required under the Regulatory 

Flexibility Act, as amended. 

Paperwork Reduction Act 

This rule does not create any new or 

affect any existing collections and, 

therefore, does not require OMB 

approval under the Paperwork 

Reduction Act. 

(Catalog of Federal Domestic Assistance 

Program Nos. 96.001, Social Security— 

Disability Insurance; 96.002, Social 

Security—Retirement Insurance; 96.004, 

Social Security—Survivors Insurance; 

96.006, Supplemental Security Income.) 

List of Subjects 

20 CFR Part 404 

Administrative practice and 

procedure; Blind, Disability benefits; 

Old-age, Survivors and Disability 

Insurance; Reporting and recordkeeping 

requirements; Social Security. 

20 CFR Part 416 

Administrative practice and 

procedure; Reporting and recordkeeping 

requirements; Supplemental Security 

Income (SSI). 

Dated: March 29, 2011. 

Michael J. Astrue, 

Commissioner of Social Security. 

For the reasons stated in the 

preamble, we are revising subpart J of 

part 404 and subpart N of part 416 of 

title 20 of the Code of Federal 

Regulations as set forth below: 

PART 404—FEDERAL OLD–AGE, 

SURVIVORS AND DISABILITY 

INSURANCE (1950—) 

Subpart J—[Amended] 

■ 1. The authority citation for subpart J 

of part 404 continues to read as follows: 

Authority: Secs. 201(j), 204(f), 205(a)–(b), 

(d)–(h), and (j), 221, 223(i), 225, and 702(a)(5) 

of the Social Security Act (42 U.S.C. 401(j), 

404(f), 405(a)–(b), (d)–(h), and (j), 421, 423(i), 

425, and 902(a)(5)); sec. 5, Pub. L. 97–455, 96 

Stat. 2500 (42 U.S.C. 405 note); secs. 5, 6(c)– 

(e), and 15, Pub. L. 98–460, 98 Stat. 1802 (42 

U.S.C. 421 note); sec. 202, Pub. L. 108–203, 

118 Stat. 509 (42 U.S.C. 902 note). 

■ 2. In § 404.942, revise paragraphs 

(f)(1) and (g) to read as follows: 

§ 404.942 Prehearing proceedings and 

decisions by attorney advisors. 

* * * * * 

(f) * * * 

(1) Authorize an attorney advisor to 

exercise the functions performed by an 

administrative law judge under 

§§ 404.1520a, 404.1526, 404.1527, and 

404.1546. 

* * * * * 

(g) Sunset provision. The provisions 

of this section will no longer be effective 

on August 9, 2013, unless we terminate 

them earlier or extend them beyond that 

date by notice of a final rule in the 

Federal Register. 

PART 416—SUPPLEMENTAL 

SECURITY INCOME FOR THE AGED, 

BLIND, AND DISABLED 

Subpart N—[Amended] 

■ 3. The authority citation for subpart N 

continues to read as follows: 

Authority: Secs. 702(a)(5), 1631, and 1633 

of the Social Security Act (42 U.S.C. 

902(a)(5), 1383, and 1383b); sec. 202, Pub. L. 

108–203, 118 Stat. 509 (42 U.S.C. 902 note). 

■ 4. In § 416.1442, revise paragraphs 

(f)(1) and (g) to read as follows: 

§ 416.1442 Prehearing proceedings and 

decisions by attorney advisors. 

* * * * * 

(f) * * * 

(1) Authorize an attorney advisor to 

exercise the functions performed by an 

administrative law judge under 

§§ 416.920a, 416.924(g), 416.926, 

416.926a(n), 416.927, and 416.946. 

* * * * * 

(g) Sunset provision. The provisions 

of this section will no longer be effective 

on August 9, 2013, unless we terminate 

them earlier or extend them beyond that 

date by notice of a final rule in the 

Federal Register. 

[FR Doc. 2011–7898 Filed 4–1–11; 8:45 am] 

BILLING CODE 4191–02–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 301 

[TD 9520] 

RIN 1545–BG13 

Withdrawal of Regulations Related to 

Validity and Priority of Federal Tax 

Lien 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations. 

SUMMARY: This document contains final 

regulations related to the validity and 

priority of the Federal tax lien against 

certain persons under section 6323 of 

the Internal Revenue Code (the Code). 

The final regulations update the 

corresponding Treasury Regulations to 

reflect changes in the law and in IRS 

practice. 

DATES: Effective Date: These regulations 

are effective on April 4, 2011. 

Applicability Date: These regulations 

apply to any notice of Federal tax lien 

filed on or after April 4, 2011. 

FOR FURTHER INFORMATION CONTACT: 

Debra A. Kohn at (202) 622–3600 (not a 

toll-free number). 

SUPPLEMENTARY INFORMATION: 

Background 

This document contains final 

regulations that amend the Procedure 

and Administration Regulations (26 CFR 

part 301) under section 6323 of the 

Code. If any person liable for tax 

neglects or refuses to pay after demand, 

the amount of that tax is a lien in favor 

of the United States against all property 

and rights to property of such person 

under section 6321. Section 6323 

provides that a Federal tax lien is only 

valid against certain persons if a notice 

of Federal tax lien (NFTL) is filed and 

addresses generally the validity and 

priority of the Federal tax lien against 

such persons. Section 6323(b) and (c) 

addresses the protection of certain 

interests even though an NFTL has been 

filed. Section 6323(f) prescribes the 

place for filing and the form of an NFTL. 

Section 6323(g) addresses the refiling of 

an NFTL. Section 6323(h) contains 

definitions of certain terms used 

throughout section 6323. 

Since 1976, there have been 

numerous amendments to section 6323 

that are not reflected in the existing 

regulations. There have also been 

several changes to IRS practice that thus 

far have not been reflected in the 

regulations. On April 17, 2008, a notice 

of proposed rulemaking (REG–141998– 

06) to reflect these changes in law and 

practice was published in the Federal 

Register (73 FR 20877–01). No 

comments were received and no public 

hearing was requested or held. 

Accordingly, in this Treasury Decision, 

the proposed regulations are adopted 

substantially without change with the 

exception of one revision described in 

this preamble. 

Explanation of Revision 

Section 301.6323(g)–1(a) sets forth 

general principles pertaining to refiling 

NFTLs. Most NFTLs now contain a 

certificate of release that automatically 

becomes effective on the date prescribed 

in the NFTL, which is the date the 

required refiling period ends. Therefore, 

if an NFTL that contains a certificate of 


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release is not timely refiled in each 

jurisdiction where it was originally 

filed, the lien self-releases and is 

extinguished in all jurisdictions. See 

IRC § 6325(f)(1)(A). The extinguishment 

of the lien invalidates NFTLs filed in 

other jurisdictions and requires the IRS 

to file certificates of revocation, as well 

as new NFTLs, in each jurisdiction 

where NFTLs were previously filed. 

The proposed regulations 

contemplated amending § 301.6323(g)– 

1(a)(3) to provide generally that, with 

respect to an NFTL that includes a 

certificate of release, failure to timely 

refile the NFTL in any jurisdiction 

where it was originally filed 

extinguishes the lien and renders the 

NFTL ineffective with respect to 

property that is the subject matter of a 

suit to which the United States is a 

party that is commenced before the 

required filing period expires, and 

property that has been levied upon by 

the United States before the refiling 

period expires. Further consideration 

led to the determination that failure to 

timely refile the NFTL should not 

render the NFTL ineffective under these 

circumstances. Accordingly, the final 

regulations provide that neither failure 

to timely refile the NFTL, nor the 

release of the lien, shall alter or impair 

any right of the United States to 

property or its proceeds that is the 

subject of a levy or judicial proceeding 

commenced prior to the end of the 

refiling period or the release of the lien, 

except to the extent that a person 

acquires an interest in the property for 

adequate consideration after the 

commencement of the proceeding and 

does not have notice of, and is not 

bound by, the outcome of the 

proceeding. 

Special Analyses 

It has been determined that this 

Treasury decision 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, and because these 

regulations do not impose 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, the notice 

of proposed rulemaking preceding these 

regulations was submitted to the Chief 

Counsel for Advocacy of the Small 

Business Administration for comment 

on its impact on small business. 

Drafting Information 

The principal author of these 

regulations is Debra A. Kohn of the 

Office of the Associate Chief Counsel 

(Procedure and Administration). 

List of Subjects in 26 CFR Part 301 

Employment taxes, Estate taxes, 

Excise taxes, Gift taxes, Income taxes, 

Penalties, Reporting and recordkeeping 

requirements. 

Adoption of Amendments to the 

Regulations 

Accordingly, 26 CFR part 301 is 

amended as follows: 

PART 301—PROCEDURE AND 

ADMINISTRATION 

■ Paragraph 1. The authority citation 

for part 301 continues to read in part as 

follows: 

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

■ Par. 2. Section 301.6323(b)–1 is 

amended as follows: 

■ 1. Paragraph (d)(1) is revised. 

■ 2. Paragraph (d)(3) Examples 1 and 3 

are revised. 

■ 3. Paragraphs (g)(1) and (g)(2) 

Examples 1, 2, and 3 are revised. 

■ 4. Paragraphs (i)(1)(iii) and (j) are 

revised. 

The revisions read as follows: 

§ 301.6323(b)–1 Protection for certain 

interests even though notice filed. 

* * * * * 

(d) Personal property purchased in 

casual sale—(1) In general. Even though 

a notice of lien imposed by section 6321 

is filed in accordance with 

§ 301.6323(f)–1, the lien is not valid 

against a purchaser (as defined in 

§ 301.6323(h)–1(f)) of household goods, 

personal effects, or other tangible 

personal property of a type described in 

§ 301.6334–1 (which includes wearing 

apparel, school books, fuel, provisions, 

furniture, arms for personal use, 

livestock, and poultry (whether or not 

the seller is the head of a family); and 

books and tools of a trade, business, or 

profession (whether or not the trade, 

business, or profession of the seller)), 

purchased, other than for resale, in a 

casual sale for less than $1,380, effective 

for 2010 and adjusted each year based 

on the rate of inflation (excluding 

interest and expenses described in 

§ 301.6323(e)–1). 

* * * * * 

(3) * * * 

Example 1. A, an attorney’s widow, sells 

a set of law books for $200 to B, for B’s own 

use. Prior to the sale a notice of lien was filed 

with respect to A’s delinquent tax liability in 

accordance with § 301.6323(f)–1. B has no 

actual notice or knowledge of the tax lien. In 

addition, B does not know that the sale is one 

of a series of sales. Because the sale is a 

casual sale for less than $1,380 and involves 

books of a profession (tangible personal 

property of a type described in § 301.6334– 

1, irrespective of the fact that A has never 

engaged in the legal profession), the tax lien 

is not valid against B even though a notice 

of lien was filed prior to the time of B’s 

purchase. 

* * * * * 

Example 3. In an advertisement appearing 

in a local newspaper, G indicates that he is 

offering for sale a lawn mower, a used 

television set, a desk, a refrigerator, and 

certain used dining room furniture. In 

response to the advertisement, H purchases 

the dining room furniture for $200. H does 

not receive any information which would 

impart notice of a lien, or that the sale is one 

of a series of sales, beyond the information 

contained in the advertisement. Prior to the 

sale a notice of lien was filed with respect 

to G’s delinquent tax liability in accordance 

with § 301.6323(f)–1. Because H had no 

actual notice or knowledge that substantially 

all of G’s household goods were being sold 

or that the sale is one of a series of sales, and 

because the sale is a casual sale for less than 

$1,380, H does not purchase the dining room 

furniture subject to the lien. The household 

goods are of a type described in § 301.6334– 

1(a)(2) irrespective of whether G is the head 

of a family or whether all such household 

goods offered for sale exceed $8,250 in value. 

* * * * * 

(g) Residential property subject to a 

mechanic’s lien for certain repairs and 

improvements—(1) In general. Even 

though a notice of a lien imposed by 

section 6321 is filed in accordance with 

§ 301.6323(f)–1, the lien is not valid 

against a mechanic’s lien or (as defined 

in § 301.6323(h)–1(b)) who holds a lien 

for the repair or improvement of a 

personal residence if— 

(i) The residence is occupied by the 

owner and contains no more than four 

dwelling units; and 

(ii) The contract price on the prime 

contract with the owner for the repair or 

improvement (excluding interest and 

expenses described in § 301.6323(e)–1) 

is not more than $6,890, effective for 

2010 and adjusted each year based on 

the rate of inflation. 

(iii) For purposes of paragraph 

(g)(1)(ii) of this section, the amounts of 

subcontracts under the prime contract 

with the owner are not to be taken into 

consideration for purposes of computing 

the $6,890 prime contract price. It is 

immaterial that the notice of tax lien 

was filed before the contractor 

undertakes his work or that he knew of 

the lien before undertaking his work. 

(2) * * * 

Example 1. A owns a building containing 

four apartments, one of which he occupies as 

his personal residence. A notice of lien 

which affects the building is filed in 

accordance with § 301.6323(f)–1. Thereafter, 


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A enters into a contract with B in the amount 

of $800, which includes labor and materials, 

to repair the roof of the building. B purchases 

roofing shingles from C for $300. B completes 

the work and A fails to pay B the agreed 

amount. In turn, B fails to pay C for the 

shingles. Under local law, B and C acquire 

mechanic’s liens on A’s building. Because 

the contract price on the prime contract with 

A is not more than $6,890 and under local 

law B and C acquire mechanic’s liens on A’s 

building, the liens of B and C have priority 

over the Federal tax lien. 

Example 2. Assume the same facts as in 

Example 1, except that the amount of the 

prime contract between A and B is $7,100. 

Because the amount of the prime contract 

with the owner, A, is in excess of $6,890, the 

tax lien has priority over the entire amount 

of each of the mechanic’s liens of B and C, 

even though the amount of the contract 

between B and C is $300. 

Example 3. Assume the same facts as in 

Example 1, except that A and B do not agree 

in advance upon the amount due under the 

prime contract but agree that B will perform 

the work for the cost of materials and labor 

plus 10 percent of such cost. When the work 

is completed, it is determined that the total 

amount due is $850. Because the prime 

contract price is not more than $6,890 and 

under local law B and C acquire mechanic’s 

liens on A’s residence, the liens of B and C 

have priority over the Federal tax lien. 

* * * * * 

(i) * * * 

(1) * * * 

(iii) After the satisfaction of a levy 

pursuant to section 6332(b), unless and 

until the Internal Revenue Service 

delivers to the insuring organization a 

notice (for example, another notice of 

levy, a letter, etc.) executed after the 

date of such satisfaction, that the lien 

exists. 

* * * * * 

(j) Effective/applicability date. This 

section applies to any notice of Federal 

tax lien filed on or after April 4, 2011. 

■ Par. 3. Section 301.6323(c)–2 is 

amended as follows: 

■ 1. Paragraph (d) Example 1, 2, 3, 4, 

and 5 is revised. 

■ 2. Paragraph (e) is added. 

The revisions and addition read as 

follows: 

§ 301.6323(c)–2 Protection for real 

property construction or improvement 

financing agreements. 

* * * * * 

(d) * * * 

Example 1. A, in order to finance the 

construction of a dwelling on a lot owned by 

him, mortgages the property to B. The 

mortgage, executed January 4, 2006, includes 

an agreement that B will make cash 

disbursements to A as the construction 

progresses. On February 1, 2006, in 

accordance with § 301.6323(f)–1, a notice of 

lien is filed and recorded in the public index 

with respect to A’s delinquent tax liability. 

A continues the construction, and B makes 

cash disbursements on June 15, 2006, and 

December 15, 2006. Under local law B’s 

security interest arising by virtue of the 

disbursements is protected against a 

judgment lien arising February 1, 2006 (the 

date of tax lien filing) out of an unsecured 

obligation. Because B is the holder of a 

security interest coming into existence by 

reason of cash disbursements made pursuant 

to a written agreement, entered into before 

tax lien filing, to make cash disbursements to 

finance the construction of real property, and 

because B’s security interest is protected, 

under local law, against a judgment lien 

arising as of the time of tax lien filing out of 

an unsecured obligation, B’s security interest 

has priority over the tax lien. 

Example 2. (i) C is awarded a contract for 

the demolition of several buildings. On 

March 3, 2004, C enters into a written 

agreement with D which provides that D will 

make cash disbursements to finance the 

demolition and also provides that repayment 

of the disbursements is secured by any sums 

due C under the contract. On April 1, 2004, 

in accordance with § 301.6323(f)–1, a notice 

of lien is filed with respect to C’s delinquent 

tax liability. With actual notice of the tax 

lien, D makes cash disbursements to C on 

August 13, September 13, and October 13, 

2004. Under local law D’s security interest in 

the proceeds of the contract with respect to 

the disbursements is entitled to priority over 

a judgment lien arising on April 1, 2004 (the 

date of tax lien filing) out of an unsecured 

obligation. 

(ii) Because D’s security interest arose by 

reason of disbursements made pursuant to a 

written agreement, entered into before tax 

lien filing, to make cash disbursements to 

finance a contract to demolish real property, 

and because D’s security interest is valid 

under local law against a judgment lien 

arising as of the time of tax lien filed out of 

an unsecured obligation, the tax lien is not 

valid with respect to D’s security interest in 

the proceeds of the demolition contract. 

Example 3. Assume the same facts as in 

Example 2 and, in addition, assume that, as 

further security for the cash disbursements, 

the March 3, 2004, agreement also provides 

for a security interest in all of C’s demolition 

equipment. Because the protection of the 

security interest arising from the 

disbursements made after tax lien filing 

under the agreement is limited under section 

6323(c)(3) to the proceeds of the demolition 

contract and because, under the 

circumstances, the security interest in the 

equipment is not otherwise protected under 

section 6323, the tax lien will have priority 

over D’s security interest in the equipment. 

Example 4. (i) On January 3, 2006, F and 

G enter into a written agreement, whereby F 

agrees to provide G with cash disbursements, 

seed, fertilizer, and insecticides as needed by 

G, in order to finance the raising and 

harvesting of a crop on a farm owned by G. 

Under the terms of the agreement F is to have 

a security interest in the crop, the farm, and 

all other property then owned or thereafter 

acquired by G. In accordance with 

§ 301.6323(f)–1, on January 10, 2006, a notice 

of lien is filed and recorded in the public 

index with respect to G’s delinquent tax 

liability. On March 3, 2006, with actual 

notice of the tax lien, F makes a cash 

disbursement of $5,000 to G and furnishes 

him seed, fertilizer, and insecticides having 

a value of $10,000. Under local law F’s 

security interest, coming into existence by 

reason of the cash disbursement and the 

furnishing of goods, has priority over a 

judgment lien arising January 10, 2006 (the 

date of tax lien filing and recording in the 

public index) out of an unsecured obligation. 

(ii) Because F’s security interest arose by 

reason of a disbursement (including the 

furnishing of goods) made under a written 

agreement which was entered into before tax 

lien filing and which constitutes an 

agreement to finance the raising or harvesting 

of a farm crop, and because F’s security 

interest is valid under local law against a 

judgment lien arising as of the time of tax 

lien filing out of an unsecured obligation, the 

tax lien is not valid with respect to F’s 

security interest in the crop even though a 

notice of lien was filed before the security 

interest arose. Furthermore, because the farm 

is property subject to the tax lien at the time 

of tax lien filing, F’s security interest with 

respect to the farm also has priority over the 

tax lien. 

Example 5. Assume the same facts as in 

Example 4 and in addition that on October 

2, 2006, G acquires several tractors to which 

F’s security interest attaches under the terms 

of the agreement. Because the tractors are not 

property subject to the tax lien at the time of 

tax lien filing, the tax lien has priority over 

F’s security interest in the tractors. 

(e) Effective/applicability date. This 

section applies with respect to any 

notice of Federal tax lien filed on or 

after April 4, 2011. 

■ Par. 4. Section 301.6323(f)–1 is 

amended as follows: 

■ 1. Paragraph (d)(2) is revised. 

■ 2. Paragraph (f) is added. 

The revision and addition read as 

follows: 

§ 301.6323(f)–1 Place for filing notice; 

form. 

* * * * * 

(d)* * * 

(2) Form 668 defined. The term Form 

668 means either a paper form or a form 

transmitted electronically, including a 

form transmitted by facsimile (fax) or 

electronic mail (e-mail). A Form 668 

must identify the taxpayer, the tax 

liability giving rise to the lien, and the 

date the assessment arose regardless of 

the method used to file the notice of 

Federal tax lien. 

* * * * * 

(f) Effective/applicability date. This 

section applies with respect to any 

notice of Federal tax lien filed on or 

after April 4, 2011. 

■ Par. 5. Section 301.6323(g)–1 is 

amended as follows: 

■ 1. Paragraphs (a)(1), (a)(3) 

introductory text, (a)(3)(i), and (a)(3)(ii), 


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(a)(4), (b)(3) introductory text, (b)(3) 

Example 1, and (b)(3) Example 5 are 

revised. 

■ 2. The undesignated text following 

paragraph (a)(3)(ii) is removed. 

■ 3. Paragraph (c)(1) is revised. 

■ 4. Paragraph (c)(2) is removed. 

■ 5. Paragraph (c)(3) is redesignated as 

paragraph (c)(2) and revised. 

■ 6. Paragraph (d) is added. 

The revisions and additions read as 

follows: 

§ 301.6323(g)–1 Refiling of notice of tax 

lien. 

(a) In general—(1) Requirement to 

refile. In order to continue the effect of 

a notice of lien, the notice must be 

refiled in the place described in 

paragraph (b) of this section during the 

required refiling period (described in 

paragraph (c) of this section). If two or 

more notices of lien are filed with 

respect to a particular tax assessment, 

and each notice of lien contains a 

certificate of release that releases the 

lien when the required refiling period 

ends, the failure to comply with the 

provisions of paragraphs (b)(1)(i) and (c) 

of this section in respect to one of the 

notices of lien releases the lien and 

renders ineffective the refiling of any 

other notice of lien. 

* * * * * 

(3) Effect of failure to refile—If the 

Internal Revenue Service fails to refile a 

notice of lien in the manner described 

in paragraphs (b) and (c) of this section, 

the notice is not effective, after the 

expiration of the required refiling 

period, as against any person described 

in section 6323(a), without regard to 

when the interest of the person in the 

property subject to the lien was 

acquired. If a notice of lien contains a 

certificate of release that provides that 

the lien is released at the end of the 

required refiling period unless the 

notice of lien is refiled, and the notice 

of lien is not refiled, then the lien is 

extinguished and the notice of lien is 

ineffective. 

(i) However, neither the failure to 

refile before the expiration of the 

refiling period, nor the release of the 

lien, shall alter or impair any right of 

the United States to property or its 

proceeds that is the subject of a levy or 

judicial proceeding commenced prior to 

the end of the refiling period or the 

release of the lien, except to the extent 

that a person acquires an interest in the 

property for adequate consideration 

after the commencement of the 

proceeding and does not have notice of, 

and is not bound by, the outcome of the 

proceeding. 

(ii) If a suit or levy referred to in the 

preceding sentence is dismissed or 

released and the property is subject to 

the lien at such time, a notice of lien 

with respect to the property is not 

effective after the suit or levy is 

dismissed or released unless refiled 

during the required refiling period. 

(4) Filing of new notice. If a notice of 

lien is not refiled, and the notice of lien 

contains a certificate of release that 

automatically releases the lien when the 

required refiling period ends, the lien is 

released as of that date and is no longer 

in existence. The Internal Revenue 

Service must revoke the release before it 

can file a new notice of lien. This new 

filing must meet the requirements of 

section 6323(f) and § 301.6323(f)–1 and 

is effective from the date on which such 

filing is made. 

(b) * * * 

(3) Examples. The following examples 

illustrate the provisions of this section: 

Example 1. A, a delinquent taxpayer, is a 

resident of State M and owns real property 

in State N. In accordance with § 301.6323(f)– 

1, notices of lien are filed in States M and 

N. The notices of lien contain certificates of 

release that release the lien at the end of the 

required refiling period. In order to continue 

the effect of the notice of lien filed in either 

M or N, the Internal Revenue Service must 

refile, during the required refiling period, the 

notice of lien with the appropriate office in 

M as well as with the appropriate office in 

N. 

* * * * * 

Example 5. D, a delinquent taxpayer, is a 

resident of State M and owns real property 

in States N and O. In accordance with 

§ 301.6323(f)–1, the Internal Revenue Service 

files notices of lien in M, N, and O States. 

Nine years and 6 months after the date of the 

assessment shown on the notice of lien, D 

establishes his residence in P, and at that 

time the Internal Revenue Service receives 

from D a notification of his change in 

residence in accordance with the provisions 

of paragraph (b)(2) of this section. On a date 

which is 9 years and 7 months after the date 

of the assessment shown on the notice of 

lien, the Internal Revenue Service properly 

refiles notices of lien in M, N, and O which 

refilings are sufficient to continue the effect 

of each of the notices of lien. The Internal 

Revenue Service is not required to file a 

notice of lien in P because D did not notify 

the Internal Revenue Service of his change of 

residence to P more than 89 days prior to the 

date each of the refilings in M, N, and O was 

completed. 

* * * * * 

(c) Required refiling period—(1) In 

general. For the purpose of this section, 

except as provided in paragraph (c)(2) of 

this section, the term required refiling 

period means— 

(i) The 1-year period ending 30 days 

after the expiration of 10 years after the 

date of the assessment of the tax; and 

(ii) The 1-year period ending with the 

expiration of 10 years after the close of 

the preceding required refiling period 

for such notice of lien. 

(2) Examples. The following examples 

illustrate the provisions of this 

paragraph: 

Example 1. On March 10, 1998, an 

assessment of tax is made against B, a 

delinquent taxpayer, and a lien for the 

amount of the assessment arises on that date. 

On July 10, 1998, in accordance with 

§ 301.6323(f)–1, a notice of lien is filed. The 

notice of lien filed on July 10, 1998, is 

effective through April 9, 2008. The first 

required refiling period for the notice of lien 

begins on April 10, 2007, and ends on April 

9, 2008. A refiling of the notice of lien during 

that period will extend the effectiveness of 

the notice of lien filed on July 10, 1998, 

through April 9, 2018. The second required 

refiling period for the notice of lien begins on 

April 10, 2017, and ends on April 9, 2018. 

Example 2. Assume the same facts as in 

Example 1, except that the Internal Revenue 

Service fails to refile a notice of lien during 

the first required refiling period (April 10, 

2007, through April 9, 2008). A notice of lien 

is filed on June 9, 2009, in accordance with 

§ 301.6323(f)–1. This notice is ineffective if 

the original notice contained a certificate of 

release, as the certificate of release would 

have had the effect of extinguishing the lien 

as of April 10, 2008. The Internal Revenue 

Service could revoke the release and file a 

new notice of lien, which would be effective 

as of the date it was filed. 

(d) Effective/applicability date. This 

section applies with respect to any 

notice of Federal tax lien filed on or 

after April 4, 2011. 

■ Par. 6. Section 301.6323(h)–1 is 

amended as follows: 

■ 1. Paragraphs (a)(2)(ii) and (a)(3) are 

revised. 

■ 2. A new paragraph (h) is added. 

The revisions and addition read as 

follows: 

§ 301.6323(h)–1 Definitions. 

(a) * * * 

(2) * * * 

(ii) The following example illustrates 

the application of paragraph (a)(2): 

Example. (i) Under the law of State X, a 

security interest in certificated securities, 

negotiable documents, or instruments may be 

perfected, and hence protected against a 

judgment lien, by filing or by the secured 

party taking possession of the collateral. 

However, a security interest in such 

intangible personal property is considered to 

be temporarily perfected for a period of 20 

days from the time the security interest 

attaches, to the extent that it arises for new 

value given under an authenticated security 

agreement. Under the law of X, a security 

interest attaches to such collateral when 

there is an agreement between the creditor 

and debtor that the interest attaches, the 

debtor has rights in the property, and 

consideration is given by the creditor. Under 

the law of X, in the case of temporary 

perfection, the security interest in such 


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18388 Federal Register / Vol. 76, No. 64 / Monday, April 4, 2011 / Rules and Regulations 

property is protected during the 20-day 

period against a judgment lien arising, after 

the security interest attaches, out of an 

unsecured obligation. Upon expiration of the 

20-day period, the holder of the security 

interest must perfect its security interest 

under local law. 

(ii) Because the security interest is 

perfected during the 20-day period against a 

subsequent judgment lien arising out of an 

unsecured obligation, and because filing or 

the taking of possession before the 

conclusion of the period of temporary 

perfection is not considered, for purposes of 

paragraph (a)(2)(i) of this section, to be a 

requisite action which relates back to the 

beginning of such period, the requirements of 

this paragraph are satisfied. Because filing or 

taking possession is a condition precedent to 

continued perfection, filing or taking 

possession of the collateral is a requisite 

action to establish such priority after 

expiration of the period of temporary 

perfection. If there is a lapse of perfection for 

failure to file or take possession, the 

determination of when the security interest 

exists (for purposes of protection against the 

tax lien) is made without regard to the period 

of temporary perfection. 

(3) Money or money’s worth. For 

purposes of this paragraph, the term 

money or money’s worth includes 

money, a security (as defined in 

paragraph (d) of this section), tangible or 

intangible property, services, and other 

consideration reducible to a money 

value. Money or money’s worth also 

includes any consideration which 

otherwise would constitute money or 

money’s worth under the preceding 

sentence which was parted with before 

the security interest would otherwise 

exist if, under local law, past 

consideration is sufficient to support an 

agreement giving rise to a security 

interest, and provided that the grant of 

the security interest is not a fraudulent 

transfer under local law or 28 U.S.C. 

§ 3304(a)(2). A firm commitment to part 

with money, a security, tangible or 

intangible property, services, or other 

consideration reducible to a money 

value does not, in itself, constitute a 

consideration in money or money’s 

worth. A relinquishing or promised 

relinquishment of dower, curtesy, or of 

a statutory estate created in lieu of 

dower or curtesy, or of other marital 

rights is not a consideration in money 

or money’s worth. Nor is love and 

affection, promise of marriage, or any 

other consideration not reducible to a 

money value a consideration in money 

or money’s worth. 

* * * * * 

(h) Effective/applicability date. This 

section applies as of April 4, 2011. 

Steven T. Miller, 

Deputy Commissioner for Services and 

Enforcement. 

Approved: March 25, 2011. 

Michael Mundaca, 

Assistant Secretary of the Treasury (Tax 

Policy). 

[FR Doc. 2011–7933 Filed 4–1–11; 8:45 am] 

BILLING CODE 4830–01–P 

PENSION BENEFIT GUARANTY 

CORPORATION 

29 CFR Part 4042 

Single-Employer Plan Termination 

Initiated by PBGC 

CFR Correction 

In Title 29 of the Code of Federal 

Regulations, Part 1927 to End, revised as 

of July 1, 2010, on page 973, § 4042.5 is 

added to read as follows: 

§ 4042.5 Disclosure of administrative 

record by PBGC. 

(a) Request for Administrative 

Record—(1) In general. Beginning on 

the third business day (as defined in 

§ 4000.22 of this chapter) after PBGC has 

issued a notice under section 4042 of 

ERISA that a plan should be terminated, 

an affected party with respect to the 

plan may make a request to PBGC for 

the administrative record of PBGC’s 

determination that the plan should be 

terminated. 

(2) Requirements. A request under 

paragraph (a) of this section must: 

(i) Be in writing; 

(ii) State the name of the plan and that 

the request is for the administrative 

record with respect to a notice issued by 

PBGC under section 4042 of ERISA that 

a plan should be terminated; 

(iii) State the name of the person 

making the request, the person’s 

relationship to the plan (e.g., plan 

participant), and that such relationship 

meets the definition of affected party 

under § 4001.2 of this chapter; and 

(iv) Be signed by the person making 

the request. 

(3) A request under paragraph (a) of 

this section must be sent to PBGC’s 

Disclosure Officer at the address 

provided on PBGC’s Web site. To 

expedite processing, the request should 

be prominently identified as an 

‘‘Administrative Record Request.’’ 

(b) PBGC Response to Request for 

Administrative Record—(1) Notification 

of plan administrator and plan sponsor. 

Upon receipt of a request under 

paragraph (a) of this section, PBGC will 

promptly notify the plan administrator 

and plan sponsor that it has received a 

request for the administrative record, 

and the date by which PBGC will 

provide the information to the affected 

party that made the request. 

(2) Confidential information. (i) In 

responding to a request under paragraph 

(a) of this section, PBGC will not 

disclose any portions of the 

administrative record that are 

prohibited from disclosure under the 

Privacy Act, 5 U.S.C. 552a. 

(ii) A plan administrator or plan 

sponsor that has received notification 

pursuant to paragraph (b)(1) of this 

section may seek a court order under 

which those portions of the 

administrative record that contain 

confidential information described in 

section 552(b) of title 5, United States 

Code— 

(A) Will be disclosed only to 

authorized representatives (within the 

meaning of section 4041(c)(2)(D)(iv) of 

ERISA) that agree to ensure the 

confidentiality of such information, and 

(B) Will not be disclosed to other 

affected parties. 

(iii) If, before the 15th business day 

(as defined in § 4000.22 of this chapter) 

after PBGC has received a request under 

paragraph (a), PBGC receives a court 

order as described in paragraph (b)(2)(ii) 

of this section, PBGC will disclose those 

portions of the administrative record 

that contain confidential information 

described in section 552(b) of title 5, 

United States Code, only as provided in 

the order. 

(3) Timing of response. PBGC will 

send the administrative record to the 

affected party that made the request not 

later than the 15th business day (as 

defined in § 4000.22 of this chapter) 

after it receives the request. 

(4) Form and manner. PBGC will 

provide the administrative record using 

measures (including electronic 

measures) reasonably calculated to 

ensure actual receipt of the material by 

the intended recipient. 

[FR Doc. 2011–8007 Filed 4–1–11; 8:45 am] 

BILLING CODE 1505–01–D 


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