Federal Register / Vol. 86, No. 45 / Wednesday, March 10, 2021 / Rules and Regulations 13647 

was not reviewed by OMB. The Office 

of Information and Regulatory Affairs 

(OIRA) has designated this rule not as 

a major rule under the Congressional 

Review Act (5 U.S.C. 801 et seq.). 

Paperwork Reduction Act 

In accordance with the requirements 

of the Paperwork Reduction Act (PRA), 

an agency may not conduct or sponsor, 

and a respondent is not required to 

respond to, an information collection 

unless it displays a currently valid 

Office of Management and Budget 

(OMB) control number. The information 

collection requirements contained in 

this final rule have been approved by 

the OMB under the Paperwork 

Reduction Act of 1995 (44 U.S.C. 3501– 

3520) and assigned OMB control 

number 2502–0253. 

Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (2 U.S.C. 1531– 

1538) establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on state, local, 

and tribal governments, and the private 

sector. This rule will not impose any 

Federal mandates on any state, local, or 

tribal government or the private sector 

within the meaning of the Unfunded 

Mandates Reform Act of 1995. 

Environmental Review 

A Finding of No Significant Impact 

with respect to the environment was 

made prior to publication of the 

proposed rule, in accordance with HUD 

regulations at 24 CFR part 50, which 

implement section 102(2)(C) of the 

National Environmental Policy Act of 

1969 (42 U.S.C. 4332(2)(C)). The 

Finding of No Significant Impact 

remains applicable, and is available for 

public inspection between the hours of 

8 a.m. and 5 p.m. weekdays in the 

Regulations Division, Office of General 

Counsel, Room 10276, Department of 

Housing and Urban Development, 451 

Seventh Street SW, Washington, DC 

20410–0500. The Finding of No 

Significant Impact will also be available 

for review in the docket for this rule on 

Regulations.gov. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

(5 U.S.C. 601 et seq.) generally requires 

an agency to conduct a regulatory 

flexibility analysis of any rule subject to 

notice and comment rulemaking 

requirements, unless the agency certifies 

that the rule will not have a significant 

economic impact on a substantial 

number of small entities. HUD has 

determined that this final rule imposes 

no additional requirements, and does 

not have a significant economic impact, 

on a substantial number of small 

entities. Of the 222 firms primarily 

engaged in manufacturing manufactured 

homes, under the NAICS definition 

(NAICS 32991), approximately 35 

produce manufactured homes subject to 

HUD’s Manufactured Home 

Construction and Safety Standards. Of 

these firms, 31 are considered to be 

small businesses based on the U.S. 

Small Business Administration’s 

threshold of 1,250 employees or less. 

The final rule applies to all the 

manufacturers and thus would affect a 

substantial number of small entities. 

However, this final rule provides all 

manufacturers, including small 

manufacturers, more time to implement 

revisions to the Construction and Safety 

Standards contained in HUD’s January 

12, 2021 final rule, but does not itself 

update or amend the Standards. As a 

result, this rule does not place any 

additional costs on any manufactured 

home manufacturers subject to the 

January 12, 2021, final rule. 

Accordingly, the undersigned certifies 

that this rule would not have a 

significant economic impact on a 

substantial number of small entities. 

Executive Order 13132, Federalism 

Executive Order 13132 (entitled 

‘‘Federalism’’) prohibits, to the extent 

practicable and permitted by law, an 

agency from promulgating a regulation 

that has federalism implications and 

either imposes substantial direct 

compliance costs on state and local 

governments and is not required by 

statute, or preempts state law, unless the 

relevant requirements of section 6 of the 

Executive order are met. This rule does 

not have federalism implications and 

does not impose substantial direct 

compliance costs on state and local 

governments or preempt state law 

within the meaning of the Executive 

order. 

Authority: 15 U.S.C. 2697, 28 U.S.C. 2461 

note, 42 U.S.C. 3535(d), 5403, 5404, 5424. 

Susan A. Betts, 

Deputy Assistant Secretary for Finance and 

Budget, Office of Housing—Federal Housing 

Administration. 

[FR Doc. 2021–05010 Filed 3–9–21; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD 9936] 

RIN 1545–BO59 

Guidance on Passive Foreign 

Investment Companies; Correction 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Correcting amendments. 

SUMMARY: This document contains 

corrections to the final regulations 

Treasury Decision 9936, that were 

published in the Federal Register on 

Friday, January 15, 2021. The final 

regulations regarding the determination 

of whether a foreign corporation is 

treated as a passive foreign investment 

company (‘‘PFIC’’) for purposes of the 

Internal Revenue Code (‘‘Code’’), and 

the application and scope of certain 

rules that determine whether a United 

States person that indirectly holds stock 

in a PFIC is treated as a shareholder of 

the PFIC. 

DATES: These corrections are effective 

on March 10, 2021 and applicable on or 

after January 15, 2021. 

FOR FURTHER INFORMATION CONTACT: 

Concerning the regulations §§ 1.1291–0 

and 1.1291–1, 1.1297–0 through 1.1297– 

2, 1.1298–0, 1.1298–2, and 1.1298–4, 

Christina G. Daniels at (202) 317–6934; 

concerning the regulations §§ 1.1297–4 

and 1.1297–6, Josephine Firehock at 

(202) 317–4932 (not toll-free numbers). 

SUPPLEMENTARY INFORMATION: 

Background 

The final regulations (TD 9936) that 

are the subject of this correction are 

issued under sections 1297 and 1298 of 

the Internal Revenue Code. 

Need for Correction 

As published on January 15, 2021 (86 

FR 4516), the final regulations (TD 

9936) contain errors that need to be 

corrected. 

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 

■ Paragraph 1. The authority citation 

for part 1 continues to read in part as 

follows: 

13648 Federal Register / Vol. 86, No. 45 / Wednesday, March 10, 2021 / Rules and Regulations 

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

■ Par. 2. Section 1.1297–0 is amended 

by revising the entry for § 1.1297– 

2(g)(12) to read as follows: 

§ 1.1297–0 Table of contents. 

* * * * * 

§ 1.1297–2 Special rules regarding lookthrough subsidiaries and look-through 

partnerships. 

* * * * * 

(g) * * * 

(12) TFC obligation. 

* * * * * 

■ Par. 3. Section 1.1297–1 is amended 

by: 

■ a. Removing ‘‘§ 1.1297–2(b)(2)(i))’’ in 

the first sentence of paragraph 

(d)(1)(v)(C)(1) and adding in its place 

‘‘§ 1.1297–2(b)(2)(i)’’. 

■ b. Revising paragraph (f)(8). 

The revision reads as follows: 

§ 1.1297–1 Definition of passive foreign 

investment company. 

* * * * * 

(f) * * * 

(8) Related person. For purposes of 

applying the rules of this section and 

§ 1.1297–2 with respect to section 

1297(b)(2)(C), the term means a related 

person within the meaning of section 

954(d)(3). 

* * * * * 

■ Par. 4. Section 1.1297–2 is amended 

by: 

■ a. Removing ‘‘of this section))’’ in the 

first sentence of paragraph (b)(3)(i) and 

adding in its place ‘‘of this section)’’. 

■ b. Revising the first sentence of 

paragraph (c)(4)(iii)(B). 

■ c. Removing ‘‘PFIC .’’ at the end of 

paragraph (e)(3)(i)(B)(1) and adding in 

its place ‘‘PFIC.’’ 

■ d. Revising the first sentence of 

paragraph (g)(4)(iv)(A)(2)(iii). 

The revisions read as follows: 

§ 1.1297–2 Special rules regarding lookthrough subsidiaries and look-through 

partnerships. 

* * * * * 

(c) * * * 

(4) * * * 

(iii) * * * 

(B) * * * The results are the same as 

in paragraph (c)(4)(ii)(B) of this section 

(the results in Example 2), except that 

TFC’s assets also do not include the 

stock of LTS2. 

* * * 

* * * * * 

(g) * * * 

(4) * * * 

(iv) * * * 

(A) * * * 

(2) * * * 

(iii) * * * For purposes of paragraph 

(b)(3) of this section, FPS qualifies as a 

look-through partnership because TFC 

satisfies the active partner tests of both 

paragraphs (g)(4)(ii)(A) and (B) of this 

section. * * * 

* * * * * 

■ Par. 5. Section 1.1297–4 is amended 

by: 

■ a. Revising paragraph (d)(6). 

■ b. Removing ‘‘written by a’’ in 

paragraph (f)(5) and adding in its place 

‘‘written by, a’’. 

The revision reads as follows: 

§ 1.1297–4 Qualifying insurance 

corporation. 

* * * * * 

(d) * * * 

(6) Stock ownership. For purposes of 

this section, ownership of stock in a 

foreign corporation means either direct 

ownership of such stock or indirect 

ownership determined using the rules 

specified in § 1.1291–1(b)(8) (but 

without regard to the 50 percent 

ownership requirement of § 1.1291– 

1(b)(8)(ii)(A)). 

* * * * * 

■ Par. 6. Section 1.1298–2 is amended 

by revising the second sentence of 

paragraph (c)(3), the second sentence of 

paragraph (f)(1)(i)(B), and the first 

sentence of paragraph (f)(2)(ii) to read as 

follows: 

§ 1.1298–2 Rules for certain corporations 

changing businesses. 

* * * * * 

(c) * * * 

(3) * * * However, if activities 

performed by the officers and 

employees of a look-through subsidiary 

of a corporation or of a look-through 

partnership (including a look-through 

subsidiary or a look-through partnership 

with respect to which paragraph (d) of 

this section applies) would be taken into 

account by the corporation pursuant to 

§ 1.1297–2(e) if it applied, such 

activities are taken into account for 

purposes of the determination of the 

existence of an active trade or business 

and the determination of whether assets 

are used in an active trade or business. 

* * * * * 

(f) * * * 

(1) * * * 

(i) * * * 

(B) * * * The residual gain computed 

under § 1.1297–2(f)(2) on the sale of the 

FS stock is $10x. * * * 

* * * * * 

(2) * * * 

(ii) * * * The results are the same as 

in paragraph (f)(1)(ii) of this section (the 

results in Example 1), except that under 

paragraph (c)(1) of this section, the 

passive income considered attributable 

to proceeds from a disposition of one or 

more active trades or businesses is $4x 

(from investment of disposition 

proceeds). * * * 

* * * * * 

§ 1.1298–4 [Amended] 

■ Par. 7. Section 1.1298–4(f) is amended 

by removing ‘‘Janyuary’’ and adding in 

its place ‘‘January’’. 

Crystal Pemberton, 

Senior Federal Register Liaison, Legal 

Processing Division, Associate Chief Counsel 

(Procedure and Administration). 

[FR Doc. 2021–04789 Filed 3–9–21; 8:45 am] 

BILLING CODE 4830–01–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD 9936] 

RIN 1545–BO59 

Guidance on Passive Foreign 

Investment Companies; Correction 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations; correction. 

SUMMARY: This document contains 

corrections to the final regulations 

(Treasury Decision 9936), that were 

published in the Federal Register on 

Friday, January 15, 2021. The final 

regulations regarding the determination 

of whether a foreign corporation is 

treated as a passive foreign investment 

company (‘‘PFIC’’) for purposes of the 

Internal Revenue Code (‘‘Code’’), and 

the application and scope of certain 

rules that determine whether a United 

States person that indirectly holds stock 

in a PFIC is treated as a shareholder of 

the PFIC. 

DATES: These corrections are effective 

on March 10, 2021 and applicable on or 

after January 15, 2021. 

FOR FURTHER INFORMATION CONTACT: 

Concerning the regulations §§ 1.1291–0 

and 1.1291–1, 1.1297–0 through 1.1297– 

2, 1.1298–0, 1.1298–2, and 1.1298–4, 

Christina G. Daniels at (202) 317–6934; 

concerning the regulations §§ 1.1297–4 

and 1.1297–6, Josephine Firehock at 

(202) 317–4932 (not toll-free numbers). 

SUPPLEMENTARY INFORMATION: 

Background 

The final regulations (TD 9936) that 

are the subject of this correction are 

issued under sections 1297 and 1298 of 

the Internal Revenue Code.