This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

46705 

Vol. 74, No. 175 

Friday, September 11, 2009 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Parts 26 and 301 

[REG–136563–07] 

RIN 1545–BG89 

Generation-Skipping Transfers (GST) 

Section 6011 Regulations and 

Amendments to the Section 6112 

Regulations 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document contains 

proposed regulations that provide rules 

relating to the disclosure of listed 

transactions and transactions of interest 

with respect to the generation-skipping 

transfer tax under section 6011 of the 

Internal Revenue Code (Code), 

conforming amendments under sections 

6111 and 6112, and rules relating to the 

preparation and maintenance of lists 

with respect to reportable transactions 

under section 6112. The regulations 

affect taxpayers participating in listed 

transactions and transactions of interest 

and material advisors to such 

transactions. The proposed regulations 

also contain rules under section 6112 

that affect material advisors to 

reportable transactions. These 

regulations provide guidance regarding 

the length of time a material advisor has 

to prepare the list that must be 

maintained after the list maintenance 

requirement first arises with respect to 

a reportable transaction. These 

regulations also clarify guidance 

regarding designation agreements. 

DATES: Written or electronic comments 

and requests for a public hearing must 

be received by December 10, 2009. 

ADDRESSES: Send submissions to: 

CC:PA:LPD:PR (REG–136563–07), room 

5203, Internal Revenue Service, P.O. 

Box 7604, Ben Franklin Station, 

Washington, DC 20044. Submissions 

may be hand delivered Monday through 

Friday between the hours of 8 a.m. and 

4 p.m. to CC:PA:LPD:PR (REG–136563– 

07), Courier’s Desk, Internal Revenue 

Service, 1111 Constitution Avenue, 

NW., Washington, DC, or sent 

electronically, via the Federal 

eRulemaking Portal at http:// 

www.regulations.gov (IRS–REG– 

136563–07). 

FOR FURTHER INFORMATION CONTACT: 

Concerning the proposed regulations, 

Charles D. Wien, (202) 622–3070; 

concerning the submissions of 

comments and requests for hearing, 

Oluwafunmilayo (Funmi) Taylor, (202) 

622–7180 (not toll-free numbers). 

SUPPLEMENTARY INFORMATION: 

Paperwork Reduction Act 

The collections of information 

contained in this notice of proposed 

rulemaking have been reviewed and 

approved by the Office of Management 

and Budget in accordance with the 

Paperwork Reduction Act (44 U.S.C. 

3507) under control number 1545–1686. 

Responses to these collections of 

information are mandatory. An agency 

may not conduct or sponsor, and a 

person is not required to respond to, a 

collection of information unless the 

collection of information displays a 

valid OMB control number assigned by 

the Office of Management and Budget. 

On August 3, 2007, the IRS published 

final regulations under § 301.6112–1 

(TD 9352; 72 FR 43154). These 

regulations propose to modify those 

regulations. 

The estimated annual burden per 

recordkeeper for the collection of 

information in § 301.6112–1T is 100 

hours and the estimated number of 

recordkeepers is 500. 

Comments concerning the accuracy of 

these burden estimates and suggestions 

for reducing these burdens should be 

sent to Internal Revenue Service, Attn: 

IRS Reports Clearance Officer, 

SE:W:CAR:MP:T:T:SP, Washington, DC 

20224, and to the Office of Management 

and Budget, Attn: Desk Officer for the 

Department of the Treasury, Office of 

Information and Regulatory Affairs, 

Washington, DC 20503. 

Books and records relating to these 

collections of information must be 

retained as long as their contents may 

become material in the administration 

of any internal revenue law. Generally, 

tax returns and return information are 

confidential, as required by 26 U.S.C. 

6103. 

Background 

This document proposes to amend 26 

CFR part 26 to provide rules for 

purposes of the generation-skipping 

transfer tax that require the disclosure of 

listed transactions and transactions of 

interest by certain taxpayers on their 

Federal tax returns under section 6011. 

This document also proposes to modify 

and clarify some of the rules under 26 

CFR part 301 relating to the disclosure 

obligations of material advisors under 

section 6111 and the list maintenance 

requirements of material advisors with 

respect to reportable transactions under 

section 6112. 

On July 31, 2007, the IRS and 

Treasury Department issued final 

regulations under section 6011 (TD 

9350; 72 FR 43146), 6111 (TD 9351; 72 

FR 43157) and 6112 (TD 9352; 72 FR 

43154) (the July 2007 regulations) that 

were published in the Federal Register 

on August 3, 2007. In the July 2007 

regulations, the IRS and Treasury 

Department amended 26 CFR parts 20, 

25, 31, 53, 54, and 56 to provide that 

certain taxpayers would be required to 

disclose transactions of interest, in 

addition to listed transactions, on their 

Federal tax returns under section 6011. 

These regulations propose to amend 26 

CFR part 26 to add similar rules under 

section 6011 for the tax on generationskipping transfers. The July 2007 

regulations also amended 26 CFR part 

301 to provide rules relating to the 

obligation of material advisors to 

prepare and maintain lists with respect 

to reportable transactions under section 

6112. These proposed regulations make 

minor clarifications and modifications 

to the rules under section 6112. 

Explanation of Provisions 

The regulations should encompass 

transactions that purport to reduce or 

eliminate the generation-skipping 

transfer tax as listed transactions or 

transactions of interest and require the 

disclosure of these transactions under 

section 6011. Although these 

regulations are being proposed, the IRS 

and Treasury Department do not have 

plans to identify any such transaction at 

this time. Clarifying amendments are 

being made to the regulations under 

sections 6111 and 6112 as a result of the 

generation-skipping transfer tax rules 

proposed under section 6011. 

The IRS and Treasury Department are 

proposing to amend the regulations 


cprice-sewell on DSKGBLS3C1PROD with PROPOSALS
46706 Federal Register / Vol. 74, No. 175 / Friday, September 11, 2009 / Proposed Rules 

under section 6112 to provide that, 

before a material advisor must make 

available to the IRS the list as described 

in § 301.6112–1(b), the material advisor 

will have a specified period of time to 

prepare the list after the list 

maintenance requirement first arises 

with respect to a reportable transaction. 

The specified period of time for a 

material advisor to prepare a list will be 

30 calendar days or a period greater 

than 30 calendar days as may be 

specifically described in the published 

guidance designating a transaction as a 

reportable transaction. A request for a 

list under section 6112 made during the 

list preparation time period will be 

treated as having been made on the day 

after the list preparation time period 

ends. 

In addition, the regulations make 

clarifications to the rules regarding 

designation agreements. A group of 

material advisors to a reportable 

transaction may designate by written 

agreement one material advisor from the 

group to maintain the list required 

under section 6112. The existence of a 

designation agreement, however, does 

not affect the ability of the IRS to 

request the list from any party to the 

designation agreement, or the obligation 

of any party receiving a request from the 

IRS to furnish the list as required under 

section 6112 and the related regulations. 

Special Analyses 

It has been determined that 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 

has also been determined that section 

553(b) of the Administrative Procedure 

Act (5 U.S.C. chapter 5) does not apply 

to these regulations. It is hereby 

certified that the collection of 

information in these regulations will not 

have a significant economic impact on 

a substantial number of small entities. 

This certification is based on the fact 

that most of the material advisors 

affected by these regulations are not 

small entities and for those material 

advisors that are small entities most of 

the information is already required 

under the current regulations. Also, the 

collection of information referenced in 

these regulations has been approved 

under OMB control number 1545–1686. 

The clarification and new information 

required by these proposed regulations 

add little or no new burden to those 

existing requirements. Therefore, a 

Regulatory Flexibility Analysis under 

the Regulatory Flexibility Act (5 U.S.C. 

chapter 6) is not required. Pursuant to 

section 7805(f) of the Code, this notice 

of proposed rulemaking will be 

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 Treasury Department request 

comments on the clarity of the proposed 

rules, how they can be made easier to 

understand, and the administrability of 

the rules in the proposed regulations. 

All comments will be available for 

public inspection and copying. A public 

hearing will be scheduled if requested 

in writing by any person that submits 

timely written or electronic comments. 

If a public hearing is scheduled, notice 

of the date, time, and place for the 

public hearing will be published in the 

Federal Register. 

Drafting Information 

The principal author of these 

regulations is Charles D. Wien, Office of 

the Associate Chief Counsel 

(Passthroughs and Special Industries). 

However, other personnel from the IRS 

and Treasury Department participated 

in their development. 

List of Subjects 

26 CFR Part 26 

Estate taxes, Reporting and 

recordkeeping requirements. 

26 CFR Part 301 

Employment taxes, Estate taxes, 

Excise taxes, Gift taxes, Income taxes, 

Penalties, Reporting and recordkeeping 

requirements. 

Proposed Amendments to the 

Regulations 

Accordingly, 26 CFR parts 26 and 301 

are proposed to be amended as follows: 

PART 26—GENERATION-SKIPPING 

TRANSFER TAX REGULATIONS 

UNDER THE TAX REFORM ACT OF 

1986 

Paragraph 1. The authority citation 

for part 26 is amended to read in part 

as follows: 

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

Section 26.6011–4 also issued under 26 

U.S.C. 6011 * * *. 

Par. 2. Section 26.6011–4 is added to 

read as follows: 

§ 26.6011–4 Requirement of statement 

disclosing participation in certain 

transactions by taxpayers. 

(a) In general. If a transaction is 

identified as a listed transaction or a 

transaction of interest as defined in 

§ 1.6011–4 of this chapter by the 

Commissioner in published guidance, 

and the listed transaction or transaction 

of interest involves a tax on generationskipping transfers under chapter 13 of 

subtitle B of the Internal Revenue Code, 

the transaction must be disclosed in the 

manner stated in such published 

guidance. 

(b) Effective/applicability date. This 

section applies to listed transactions 

and transactions of interest entered into 

on or after the date these regulations are 

published as final regulations in the 

Federal Register. 

PART 301—PROCEDURE AND 

ADMINISTRATION 

Par. 3. The authority citation for part 

301 continues to read in part as follows: 

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

Par. 4. Section 301.6111–3 is 

amended as follows: 

1. Paragraphs (b)(2)(i)(A) and 

(b)(3)(i)(B) are amended by adding the 

language ‘‘26.6011–4,’’ after each 

occurrence of ‘‘25.6011–4,’’. 

2. Paragraphs (c)(2) and (c)(13) are 

amended by adding the language 

‘‘26.6011–4,’’ after ‘‘25.6011–4,’’. 

3. Paragraph (i)(1) is revised. 

The revision reads as follows: 

§ 301.6111–3 Disclosure of reportable 

transactions. 

* * * * * 

(i) Effective/applicability date—(1) In 

general. This section applies to 

transactions with respect to which a 

material advisor makes a tax statement 

on or after August 3, 2007. However, 

this section applies to transactions of 

interest entered into on or after 

November 2, 2006, with respect to 

which a material advisor makes a tax 

statement under this section on or after 

November 2, 2006. Paragraphs 

(b)(2)(i)(A), (b)(3)(i)(B), (c)(2), and (c)(13) 

of this section apply to transactions 

with respect to which a material advisor 

makes a tax statement under this section 

after the date these regulations are 

published as final regulations in the 

Federal Register. Paragraph (h) of this 

section applies to ruling requests 

received on or after November 2, 2006. 

Otherwise, the rules that apply on or 

before the date these regulations are 

published as final regulations in the 

Federal Register are contained in this 

section in effect prior to the date these 

regulations are published as final 


cprice-sewell on DSKGBLS3C1PROD with PROPOSALS
Federal Register / Vol. 74, No. 175 / Friday, September 11, 2009 / Proposed Rules 46707 

regulations in the Federal Register (see 

26 CFR part 301 revised as of April 1, 

2009). 

* * * * * 

Par. 5. Section 301.6112–1 is 

amended as follows: 

1. Paragraph (b)(1) is revised. 

2. Paragraphs (c)(3) and (c)(12) are 

amended by adding the language 

‘‘26.6011–4,’’ after ‘‘25.6011–4,’’. 

3. Paragraphs (f) and (g) are revised. 

The revisions read as follows: 

§ 301.6112–1 Material advisors of 

reportable transactions must keep lists of 

advisees, etc. 

* * * * * 

(b) * * * (1) In general. A separate list 

must be prepared and maintained for 

each reportable transaction. However, 

one list must be maintained for 

substantially similar transactions. A 

material advisor will have 30 calendar 

days from the date the list maintenance 

requirement first arises (see § 301.6111– 

3(b)(4) and paragraph (a) of this section) 

with respect to a reportable transaction 

to prepare the list that must be 

maintained under this section with 

respect to that transaction. The 

Commissioner in his discretion also 

may provide in published guidance 

designating a transaction as a reportable 

transaction a list preparation time 

period greater than 30 calendar days. If 

a list is requested under this section 

during the list preparation time period, 

the request for the list will be treated as 

having been made on the day after the 

list preparation time period ends. A list 

must be maintained in a form that 

enables the IRS to determine without 

undue delay or difficulty the 

information required in paragraph (b)(3) 

of this section. The Commissioner in his 

discretion may provide in published 

guidance a form or method for 

maintaining or furnishing the list. 

* * * * * 

(f) Designation agreements. If more 

than one material advisor is required to 

maintain a list of persons for a 

reportable transaction, in accordance 

with paragraph (b) of this section, the 

material advisors may designate by 

written agreement a single material 

advisor (the designated material 

advisor) to maintain the list or a portion 

of the list. A designation agreement does 

not relieve material advisors from their 

obligation to maintain the list in 

accordance with paragraph (b) of this 

section or to furnish the list to the IRS 

in accordance with paragraph (e)(1) of 

this section, but a designation 

agreement may allow one material 

advisor to maintain the list on behalf of 

the other material advisors who are a 

party to the designation agreement. A 

material advisor is not relieved from the 

requirement of this section because a 

material advisor is unable to obtain the 

list from any designated material 

advisor, any designated material advisor 

did not maintain a list, or the list 

maintained by any designated material 

advisor is not complete. The existence 

of a designation agreement does not 

affect the ability of the IRS to request 

the list from any party to the 

designation agreement. The IRS may 

request the list from any party to the 

designation agreement, and the party 

receiving the request must furnish the 

list to the IRS in accordance with 

paragraph (e)(1) of this section, 

regardless of whether the list was 

maintained by another party pursuant to 

the terms of a designation agreement. 

(g) Effective/applicability date. In 

general, this section applies to 

transactions with respect to which a 

material advisor makes a tax statement 

under § 301.6111–3 on or after August 3, 

2007. However, this section applies to 

transactions of interest entered into on 

or after November 2, 2006, with respect 

to which a material advisor makes a tax 

statement under § 301.6111–3 on or 

after November 2, 2006. Paragraphs 

(b)(1), (c)(3), (c)(12), and (f) of this 

section apply to transactions with 

respect to which a material advisor 

makes a tax statement under 

§ 301.6111–3 after the date these 

regulations are published as final 

regulations in the Federal Register. 

Otherwise, the rules that apply on or 

before the date these regulations are 

published as final regulations in the 

Federal Register are contained in this 

section in effect prior to the date these 

regulations are published as final 

regulations in the Federal Register (see 

26 CFR part 301 revised as of April 1, 

2009). 

Linda E. Stiff, 

Deputy Commissioner for Services and 

Enforcement. 

[FR Doc. E9–21665 Filed 9–10–09; 8:45 am] 

BILLING CODE 4830–01–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 721 

[EPA–HQ–OPPT–2008–0483; FRL–8432–3] 

RIN 2070–AJ36 

Elemental Mercury Used in Flow 

Meters, Natural Gas Manometers, and 

Pyrometers; Proposed Significant New 

Use Rule 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: EPA is proposing a significant 

new use rule (SNUR) under section 

5(a)(2) of the Toxic Substances Control 

Act (TSCA) for elemental mercury (CAS 

No. 7439–97–6) for use in flow meters, 

natural gas manometers, and 

pyrometers, except for use in these 

articles when they are in service as of 

the effective date of the final rule. This 

action would require persons who 

intend to manufacture (including 

import) or process elemental mercury 

for an activity that is designated as a 

significant new use by this proposed 

rule to notify EPA at least 90 days before 

commencing that activity. Persons 

subject to the provisions of this 

proposed rule would not be exempt 

from significant new use reporting if 

they import into the United States or 

process elemental mercury as part of an 

article. The required notification would 

provide EPA with the opportunity to 

evaluate the intended use and, if 

necessary, to prohibit or limit that 

activity before it occurs. 

DATES: Comments must be received on 

or before November 10, 2009. 

ADDRESSES: Submit your comments, 

identified by docket identification (ID) 

number EPA–HQ–OPPT–2008–0483, by 

one of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the on– 

line instructions for submitting 

comments. 

• Mail: Document Control Office 

(7407M), Office of Pollution Prevention 

and Toxics (OPPT), Environmental 

Protection Agency, 1200 Pennsylvania 

Ave., NW., Washington, DC 20460– 

0001. 

• Hand Delivery: OPPT Document 

Control Office (DCO), EPA East Bldg., 

Rm. 6428, 1201 Constitution Ave., NW., 

Washington, DC. Attention: Docket ID 

Number EPA–HQ–OPPT–2008–0483. 

The DCO is open from 8 a.m. to 4 p.m., 

Monday through Friday, excluding legal 

holidays. The telephone number for the 

DCO is (202) 564–8930. Such deliveries 

are only accepted during the DCO’s 

normal hours of operation, and special 

arrangements should be made for 

deliveries of boxed information. 

Instructions: Direct your comments to 

docket ID number EPA–HQ–OPPT– 

2008–0483. EPA’s policy is that all 

comments received will be included in 

the docket without change and may be 

made available on–line at http:// 

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be Confidential Business 

Information (CBI) or other information 

whose disclosure is restricted by statute. 


cprice-sewell on DSKGBLS3C1PROD with PROPOSALS