33208 Federal Register / Vol. 80, No. 112 / Thursday, June 11, 2015 / Proposed Rules 

(e) Involved with accusing any person 

of a crime or formally censuring any 

person; 

(f) Of a personal nature, if disclosure 

would constitute a clearly unwarranted 

invasion of personal privacy; 

(g) Either investigatory records 

compiled for law enforcement purposes 

or information which, if written, would 

be contained in such records, but only 

to the extent that the production of 

records or information would: 

(1) Interfere with enforcement 

proceedings; 

(2) Deprive a person of a right to 

either a fair trial or an impartial 

adjudication; 

(3) Constitute an unwarranted 

invasion of personal privacy; 

(4) Disclose the identity of a 

confidential source or sources and, in 

the case of a record compiled either by 

a criminal law enforcement authority or 

by an agency conducting a lawful 

national security intelligence 

investigation, confidential information 

furnished only by the confidential 

source(s); 

(5) Disclose investigative techniques 

and procedures; or 

(6) Endanger the life or physical safety 

of law enforcement personnel; 

(h) Contained in or relating to 

examination, operating, or condition 

reports prepared by, on behalf of, or for 

the use of an agency responsible for the 

regulation or supervision of financial 

institutions; 

(i) If prematurely disclosed, likely to 

significantly frustrate implementation of 

a proposed action of the Council, except 

that this subsection shall not apply in 

any instance where the Council has 

already disclosed to the public the 

content or nature of its proposed action 

or is required by law to make such 

disclosure on its own initiative prior to 

taking final action on such proposal; 

and 

(j) Specifically concerned with the 

Council’s issuance of a subpoena, or its 

participation in a civil action or 

proceeding, an action in a foreign court 

or international tribunal, or an 

arbitration, or the initiation, conduct, or 

disposition by the Council of a 

particular case or formal agency 

adjudication pursuant to the procedures 

in 5 U.S.C. 554 or otherwise involving 

a determination on the record after 

opportunity for a hearing. 

§ 10002.6 Procedures for closing meetings 

or withholding information, and requests by 

affected persons to close a meeting. 

(a) A meeting or portion of a meeting 

may be closed and information 

pertaining to a meeting withheld under 

§ 10002.5 only by vote of a majority of 

members. 

(b) A separate vote of the members 

shall be taken with respect to each 

meeting or portion of a meeting 

proposed to be closed and with respect 

to information which is proposed to be 

withheld. A single vote may be taken 

with respect to a series of meetings or 

portions of a meeting that are proposed 

to be closed, so long as each meeting or 

portion thereof in the series involves the 

same particular matter and is scheduled 

to be held no more than 30 days after 

the initial meeting in the series. The 

vote of each member shall be recorded 

and no proxies shall be allowed. 

(c) A person whose interests may be 

directly affected by a portion of a 

meeting may request in writing that the 

Council close that portion for any of the 

reasons referred to in § 10002.5(e), (f), 

and (g). Upon the request of a member, 

a recorded vote shall be taken whether 

to close such meeting or portion thereof. 

(d) For every meeting closed, the 

General Counsel shall publicly certify 

that, in his or her opinion, the meeting 

may be closed to the public and shall 

state each relevant basis for closing the 

meeting. If the General Counsel invokes 

the bases set forth in § 10002.5(a) or (c), 

he or she shall rely upon the 

classification or designation assigned to 

the information by the originating 

agency. A copy of such certification, 

together with a statement by the 

presiding officer setting forth the time 

and place of the meeting and the 

persons present, shall be retained by the 

Council as part of the transcript, 

recording, or minutes required by 

§ 10002.8. 

§ 10002.7 Changes following public 

announcement. 

(a) The time or place of a meeting may 

be changed following the public 

announcement described in § 10002.4. 

The Council must publicly announce 

such change at the earliest practicable 

time. 

(b) The subject matter of a meeting or 

the determination of the Council to 

open or close a meeting, or a portion 

thereof, to the public may be changed 

following public announcement only if: 

(1) A majority of all members 

determine by recorded vote that Council 

business so requires and that no earlier 

announcement of the change was 

possible; and 

(2) The Council publicly announces 

such change and the vote of each 

member thereon at the earliest 

practicable time. 

§ 10002.8 Transcripts, recordings, or 

minutes of closed meetings. 

Along with the General Counsel’s 

certification and presiding officer’s 

statement referred to in § 10002.6(d), the 

Council shall maintain a complete 

transcript or electronic recording 

adequate to record fully the proceedings 

of each meeting, or a portion thereof, 

closed to the public. Alternatively, for 

any meeting closed pursuant to 

§ 10002.5(h) or (j), the Council may 

maintain a set of minutes adequate to 

record fully the proceedings, including 

a description of each of the views 

expressed on any item and the record of 

any roll call vote. 

§ 10002.9 Public availability and retention 

of transcripts, recordings, and minutes, and 

applicable fees. 

(a) The Council shall make available, 

in a place easily accessible, such as 

www.ncd.gov, to the public the 

transcript, electronic recording, or 

minutes of a meeting, except for items 

of discussion or testimony related to 

matters the Council determines may be 

withheld under § 10002.6. 

(b) Copies of the nonexempt portions 

of the transcripts or minutes shall be 

provided upon receipt of the actual 

costs of the transcription or duplication. 

(c) The Council shall maintain 

meeting transcripts, recordings, or 

minutes of each meeting closed to the 

public for a period ending at the later of 

two years following the date of the 

meeting, or one year after the 

conclusion of any Council proceeding 

with respect to the closed meeting. 

PARTS 10003–10049 [RESERVED] 

Dated: June 4, 2015. 

Rebecca Cokley, 

Executive Director. 

[FR Doc. 2015–14121 Filed 6–10–15; 8:45 am] 

BILLING CODE 8421–03–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2015–2047; Directorate 

Identifier 2015–CE–013–AD] 

RIN 2120–AA64 

Airworthiness Directives; SOCATA 

Airplanes 

AGENCY: Federal Aviation 

Administration (FAA), Department of 

Transportation (DOT). 

ACTION: Supplemental notice of 

proposed rulemaking (NPRM); 

reopening of the comment period. 

SUMMARY: We are revising an NPRM for 

SOCATA Model TBM 700 airplaness 


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Federal Register / Vol. 80, No. 112 / Thursday, June 11, 2015 / Proposed Rules 33209 

(type certificate previously held by 

EADS SOCATA) that was proposed to 

revise AD 2007–04–13. This proposed 

AD results from mandatory continuing 

airworthiness information (MCAI) 

originated by an aviation authority of 

another country to identify and correct 

an unsafe condition on an aviation 

product. The MCAI describes the unsafe 

condition as cracks found on the main 

landing gear cylinders. This action 

revises the NPRM by including the 

actions against those airplanes that 

reach a certain number of landings after 

the effective date of the AD. We are 

proposing this supplemental NPRM 

(SNPRM) to correct the unsafe condition 

on these products. Since this action 

imposes an additional burden over that 

proposed in the NPRM, we are 

reopening the comment period to allow 

the public the chance to comment on 

this proposed change. 

DATES: We must receive comments on 

this proposed AD by July 27, 2015. 

ADDRESSES: You may send comments by 

any of the following methods: 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

• Fax: (202) 493–2251. 

• Mail: U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE., 

Washington, DC 20590. 

• Hand Delivery: U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE., 

Washington, DC 20590, between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. 

For service information identified in 

this proposed AD, contact SOCATA, 

Direction des Services, 65921 Tarbes 

Cedex 9, France; telephone: 33 (0)5 

62.41.73.00; fax: 33 (0)5 62.41.76.54; or 

SOCATA North America, North Perry 

Airport, 7501 S Airport Rd., Pembroke 

Pines, Florida 33023, telephone: (954) 

893–1400; fax: (954) 964–4141; Internet: 

http://www.socata.com. You may 

review this referenced service 

information at the FAA, Small Airplane 

Directorate, 901 Locust, Kansas City, 

Missouri 64106. For information on the 

availability of this material at the FAA, 

call (816) 329–4148. It is also available 

on the Internet at http://

www.regulations.gov by searching for 

and locating Docket No. FAA–2015– 

2047. 

Examining the AD Docket 

You may examine the AD docket on 

the Internet at http://

www.regulations.gov by searching for 

and locating Docket No. FAA–2015– 

2047; or in person at the Docket 

Management Facility between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. The AD docket 

contains this proposed AD, the 

regulatory evaluation, any comments 

received, and other information. The 

street address for the Docket Office 

(telephone (800) 647–5527) is in the 

ADDRESSES section. Comments will be 

available in the AD docket shortly after 

receipt. 

FOR FURTHER INFORMATION CONTACT: 

Albert J. Mercado, Aerospace Engineer, 

FAA, Small Airplane Directorate, 901 

Locust, Room 301, Kansas City, 

Missouri 64106; telephone: (816) 329– 

4119; fax: (816) 329–4090; email: 

albert.mercado@faa.gov. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

We invite you to send any written 

relevant data, views, or arguments about 

this proposed AD. Send your comments 

to an address listed under the 

ADDRESSES section. Include ‘‘Docket No. 

FAA–2015–2047; Directorate Identifier 

2015–CE–013–AD’’ at the beginning of 

your comments. We specifically invite 

comments on the overall regulatory, 

economic, environmental, and energy 

aspects of this proposed AD. We will 

consider all comments received by the 

closing date and may amend this 

proposed AD because of those 

comments. 

We will post all comments we 

receive, without change, to http://

www.regulations.gov, including any 

personal information you provide. We 

will also post a report summarizing each 

substantive verbal contact we receive 

about this proposed AD. 

The docket number and the 

directorate identifier of the NPRM (80 

FR 8821, February 19, 2015) is Docket 

No. FAA–2006–26235; Directorate 

Identifier 2006–CE–065–AD. The NPRM 

docket number is different than the 

docket number of this SNPRM. The 

comment period for the NPRM closed 

on April 6, 2015; we received one 

comment in support of the NPRM. 

Discussion 

We proposed to amend 14 CFR part 

39 with an NPRM for SOCATA Model 

TBM 700 airplanes (type certificate 

previously held by EADS SOCATA), 

which was published in the Federal 

Register on February 19, 2015 (80 FR 

8821). The NPRM proposed to require 

actions intended to address the unsafe 

condition for the products listed above 

and was based on mandatory continuing 

airworthiness information (MCAI) 

originated by another country. 

Since the NPRM was issued, we have 

determined that airplanes with MLG 

with forging body that had not reached 

1,750 landings as of March 23, 2007 (the 

effective date of AD 2007–04–13) were 

not affected by the AD. This is not the 

intent and allows airplanes to fly 

indefinitely with the unsafe condition. 

This supplemental NPRM (SNPRM) 

proposes to make those airplanes with 

MLG with forging body either at or 

under 1,750 landings as of March 23, 

2007, applicable to the AD in addition 

to extending the time between the 

repetitive inspections until a reinforced 

landing gear is installed, which 

terminates the repetitive inspections. 

Related Service Information Under 1 

CFR Part 51 

EADS SOCATA has issued TBM 

Aircraft Mandatory Service Bulletin SB 

70–130, ATA No. 32, dated January 

2006, and SOCATA has issued DAHER– 

SOCATA TBM Aircraft Mandatory 

Service Bulletin SB 70–130, Revision 3, 

dated December 2014. The actions 

described in this service information are 

intended to correct the unsafe condition 

identified in the MCAI. The DAHER– 

SOCATA TBM Aircraft Mandatory 

Service Bulletin SB 70–130, Revision 3, 

dated December 2014, incorporates 

procedures for replacing cracked MLG 

with a reinforced MLG as a terminating 

action for the repetitive inspections. 

This service information is reasonably 

available because the interested parties 

have access to it through their normal 

course of business or by the means 

identified in the ADDRESSES section of 

this NPRM. 

FAA’s Determination and Requirements 

of the Proposed AD 

This product has been approved by 

the aviation authority of another 

country, and is approved for operation 

in the United States. Pursuant to our 

bilateral agreement with this State of 

Design Authority, they have notified us 

of the unsafe condition described in the 

MCAI and service information 

referenced above. We are proposing this 

AD because we evaluated all 

information and determined the unsafe 

condition exists and is likely to exist or 

develop on other products of the same 

type design. 

Certain changes described above 

expand the scope of the NPRM. As a 

result, we have determined that it is 

necessary to reopen the comment period 

to provide additional opportunity for 

the public to comment on the SNPRM. 

Costs of Compliance 

We estimate that this proposed AD 

will affect 431 products of U.S. registry. 


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We also estimate that it would take 

about 3 work-hours per product to 

comply with the basic requirements of 

this proposed AD. The average labor 

rate is $85 per work-hour. 

Based on these figures, we estimate 

the cost of the proposed AD on U.S. 

operators to be $109,905, or $255 per 

product. 

In addition, we estimate that any 

necessary follow-on actions would take 

about 4 work-hours and require parts 

costing $6,000, for a cost of $6,340 per 

product. We have no way of 

determining the number of products 

that may need these actions. 

Authority for This Rulemaking 

Title 49 of the United States Code 

specifies the FAA’s authority to issue 

rules on aviation safety. Subtitle I, 

section 106, describes the authority of 

the FAA Administrator. ‘‘Subtitle VII: 

Aviation Programs,’’ describes in more 

detail the scope of the Agency’s 

authority. 

We are issuing this rulemaking under 

the authority described in ‘‘Subtitle VII, 

Part A, Subpart III, section 44701: 

General requirements.’’ Under that 

section, Congress charges the FAA with 

promoting safe flight of civil aircraft in 

air commerce by prescribing regulations 

for practices, methods, and procedures 

the Administrator finds necessary for 

safety in air commerce. This regulation 

is within the scope of that authority 

because it addresses an unsafe condition 

that is likely to exist or develop on 

products identified in this rulemaking 

action. 

Regulatory Findings 

We determined that this proposed AD 

would not have federalism implications 

under Executive Order 13132. This 

proposed AD would not have a 

substantial direct effect on the States, on 

the relationship between the national 

Government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government. 

For the reasons discussed above, I 

certify this proposed regulation: 

(1) Is not a ‘‘significant regulatory 

action’’ under Executive Order 12866, 

(2) Is not a ‘‘significant rule’’ under 

the DOT Regulatory Policies and 

Procedures (44 FR 11034, February 26, 

1979), 

(3) Will not affect intrastate aviation 

in Alaska, and 

(4) Will not have a significant 

economic impact, positive or negative, 

on a substantial number of small entities 

under the criteria of the Regulatory 

Flexibility Act. 

List of Subjects in 14 CFR Part 39 

Air transportation, Aircraft, Aviation 

safety, Incorporation by Reference, 

Safety. 

The Proposed Amendment 

Accordingly, under the authority 

delegated to me by the Administrator, 

the FAA proposes to amend 14 CFR part 

39 as follows: 

PART 39—AIRWORTHINESS 

DIRECTIVES 

■ 1. The authority citation for part 39 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 40113, 44701. 

§ 39.13 [Amended] 

■ 2. The FAA amends § 39.13 by 

removing Amendment 39–14945 (72 FR 

7576, February 16, 2007), and adding 

the following new AD: 

SOCATA (type certificate previously held by 

EADS SOCATA): Docket No. FAA–2015– 

2047; Directorate Identifier 2015–CE– 

013–AD. 

(a) Comments Due Date 

We must receive comments by July 27, 

2015. 

(b) Affected ADs 

This AD supersedes AD 2007–04–13, 

Amendment 39–14945, (72 FR 7576, 

February 16, 2007) (‘‘AD 2007–04–13’’). 

(c) Applicability 

This AD applies to SOCATA Model TBM 

700 airplanes, serial numbers 1 through 638 

and 687, that: 

(1) are not equipped with a left-hand main 

landing gear (MLG) body part number (P/N) 

D68161 or D68161–1 and a right-hand MLG 

body P/N D68162 or D68162–1; and 

(2) are certificated in any category. 

(d) Subject 

Air Transport Association of America 

(ATA) Code 32: Landing gear. 

(e) Reason 

This AD was prompted from mandatory 

continuing airworthiness information (MCAI) 

originated by an aviation authority of another 

country to identify and correct an unsafe 

condition on an aviation product and the 

FAA’s determination to add additional 

airplanes to the Applicability section. We are 

issuing this AD to detect and correct cracks 

in the shock strut cylinder of the MLG, which 

could cause the MLG to fail, and to add 

airplanes to the Applicability section. Failure 

of the shock strut cylinder of the MLG could 

result in a collapsed MLG during takeoff or 

landing and possible reduced structural 

integrity of the airplane. We are superseding 

AD 2007–04–13 to add airplanes to the 

Applicability section, increase the time 

between the repetitive inspections, and 

incorporate a modification to terminate the 

required repetitive inspections. 

(f) Actions and Compliance for Airplanes not 

Previously Affected by AD 2007–04–13 

Unless already done, do the actions in 

paragraphs (f)(1), (f)(2), and (h) of this AD: 

(1) As of March 23, 2007 (the effective date 

of AD 2007–04–13), for MLG with forging 

body that were either at or under 1,750 

landings as of March 23, 2007 (the effective 

date of (AD 2007–04–13): Upon or before 

accumulating 1,750 landings on the MLG 

with forging body since new or within the 

next 100 landings after the effective date of 

this AD, whichever occurs later, inspect the 

forging body for cracks. Do the inspection 

following the Accomplishment Instructions 

of EADS SOCATA TBM Aircraft Mandatory 

Service Bulletin SB 70–130, dated January 

2006, or DAHER–SOCATA TBM Aircraft 

Mandatory Service Bulletin SB 70–130, 

Revision 3, dated December 2014. 

(2) If no cracks are detected during the 

inspection required in paragraph (f)(1) of this 

AD, repetitively thereafter inspect at intervals 

not to exceed 240 landings until a reinforced 

landing gear specified in paragraph E. 

Terminating Solution of the Accomplishment 

Instructions in DAHER–SOCATA TBM 

Aircraft Mandatory Service Bulletin SB 70– 

130, Revision 3, dated December 2014, is 

installed. 

(g) Actions and Compliance for Airplanes 

Previously Affected by AD 2007–04–13 

Unless already done, do the actions in 

paragraphs (g)(1), (g)(2), and (h) of this AD, 

including all subparagraphs: 

(1) As of March 23, 2007 (the effective date 

retained from AD 2007–04–13), for MLG with 

forging body totaling more than 1,750 

landings but less than 3,501 landings since 

new: 

(i) Inspect the forging body for cracks 

within 100 landings after March 23, 2007 (the 

effective date retained from AD 2007–04–13), 

following the Accomplishment Instructions 

of EADS SOCATA TBM Aircraft Mandatory 

Service Bulletin SB 70–130, dated January 

2006, or DAHER–SOCATA TBM Aircraft 

Mandatory Service Bulletin SB 70–130, 

Revision 3, dated December 2014. 

(ii) If no cracks are detected during the 

inspection required in paragraph (g)(1)(i) of 

this AD, repetitively thereafter inspect at 

intervals not to exceed 240 landings until a 

reinforced landing gear specified in 

paragraph E. Terminating Solution of the 

Accomplishment Instructions in DAHER– 

SOCATA TBM Aircraft Mandatory Service 

Bulletin SB 70–130, Revision 3, dated 

December 2014, is installed. 

(2) As of March 23, 2007 (the effective date 

retained from AD 2007–04–13), for MLG with 

forging body totaling more than 3,500 

landings since new: 

(i) Inspect the forging body for cracks 

within 25 landings after March 23, 2007 (the 

effective date retained from AD 2007–04–13), 

following the Accomplishment Instructions 

of EADS SOCATA TBM Aircraft Mandatory 

Service Bulletin SB 70–130, dated January 

2006, or DAHER–SOCATA TBM Aircraft 

Mandatory Service Bulletin SB 70–130, 

Revision 3, dated December 2014. 

(ii) If no cracks are detected during the 

inspection required in paragraph (g)(2)(i) of 

this AD, repetitively thereafter inspect at 


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Federal Register / Vol. 80, No. 112 / Thursday, June 11, 2015 / Proposed Rules 33211 

intervals not to exceed 240 landings until a 

reinforced landing gear specified in 

paragraph E. Terminating Solution of the 

Accomplishment Instructions in DAHER– 

SOCATA TBM Aircraft Mandatory Service 

Bulletin SB 70–130, Revision 3, dated 

December 2014, is installed. 

(h) Actions and Compliance for All Affected 

Airplanes 

If any cracks are detected during any 

inspection required in paragraphs (f)(1) 

through (g)(2) of this AD, including all 

subparagraphs: 

(1) Before further flight, remove the 

affected landing gear leg and confirm the 

presence of the crack with dye penetrant 

inspection or fluorescent penetrant 

inspection. 

(2) If the crack is confirmed, before further 

flight, contact SOCATA at the address in 

paragraph (k) of this AD to coordinate the 

FAA-approved landing gear repair/

replacement and implement any FAAapproved repair/replacement instructions 

obtained from SOCATA, or replace the 

cracked landing gear with a reinforced 

landing gear specified in paragraph E. 

Terminating Solution of the Accomplishment 

Instructions in DAHER–SOCATA TBM 

Aircraft Mandatory Service Bulletin SB 70– 

130, Revision 3, dated December 2014. This 

replacement terminates the repetitive 

inspections required by this AD. 

(i) Calculating Unknown Number of 

Landings for Compliance 

The compliance times of this AD are 

presented in landings instead of hours timein-service (TIS). If the number of landings is 

unknown, hours TIS may be used by dividing 

the number of hours TIS by 1.35. 

(j) Other FAA AD Provisions 

The following provisions also apply to this 

AD: 

(1) Alternative Methods of Compliance 

(AMOCs): The Manager, Standards Office, 

FAA, has the authority to approve AMOCs 

for this AD, if requested using the procedures 

found in 14 CFR 39.19. Send information to 

ATTN: Albert J. Mercado, Aerospace 

Engineer, FAA, Small Airplane Directorate, 

901 Locust, Room 301, Kansas City, Missouri 

64106; telephone: (816) 329–4119; fax: (816) 

329–4090; email: albert.mercado@faa.gov. 

Before using any approved AMOC on any 

airplane to which the AMOC applies, notify 

your appropriate principal inspector (PI) in 

the FAA Flight Standards District Office 

(FSDO), or lacking a PI, your local FSDO. 

(2) Airworthy Product: For any requirement 

in this AD to obtain corrective actions from 

a manufacturer or other source, use these 

actions if they are FAA-approved. Corrective 

actions are considered FAA-approved if they 

are approved by the State of Design Authority 

(or their delegated agent). You are required 

to assure the product is airworthy before it 

is returned to service. 

(k) Related Information 

Refer to MCAI European Aviation Safety 

Agency (EASA) AD No. 2006–0085R2, dated 

January 16, 2015. You may examine the 

MCAI on the Internet at http://

www.regulations.gov by searching for and 

locating Docket No. FAA–2006–26235. For 

service information related to this AD, 

contact SOCATA, Direction des Services, 

65921 Tarbes Cedex 9, France; telephone: 33 

(0)5 62.41.73.00; fax: 33 (0)5 62.41.76.54; or 

SOCATA North America, North Perry 

Airport, 7501 S Airport Rd., Pembroke Pines, 

Florida 33023, telephone: (954) 893–1400; 

fax: (954) 964–4141; Internet: http://

www.socata.com. You may view this 

referenced service information at the FAA, 

Small Airplane Directorate, 901 Locust, 

Kansas City, Missouri 64106. For information 

on the availability of this material at the 

FAA, call (816) 329–4148. 

Issued in Kansas City, Missouri, on June 1, 

2015. 

Earl Lawrence, 

Manager, Small Airplane Directorate, Aircraft 

Certification Service. 

[FR Doc. 2015–13917 Filed 6–10–15; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Parts 1 and 301 

[REG–101652–10] 

RIN 1545–BJ29 

Elimination of Circular Adjustments to 

Basis; Absorption of Losses 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document contains 

proposed amendments to the 

consolidated return regulations. These 

amendments would revise the rules 

concerning the use of a consolidated 

group’s losses in a consolidated return 

year in which stock of a subsidiary is 

disposed of. The regulations would 

affect corporations filing consolidated 

returns. 

DATES: Written or electronic comments, 

and a request for a public hearing, must 

be received by September 9, 2015. 

ADDRESSES: Send submissions to: 

CC:PA:LPD:PR (REG–101652–10), Room 

5205, Internal Revenue Service, PO Box 

7604, Ben Franklin Station, Washington, 

DC 20044. Submissions may be handdelivered Monday through Friday 

between the hours of 8 a.m. and 4 p.m. 

to CC:PA:LPD:PR (REG–101652–10), 

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– 

101652–10). 

FOR FURTHER INFORMATION CONTACT: 

Concerning the proposed regulations, 

Robert M. Rhyne, (202) 317–6848; 

concerning submissions of comments or 

to request a public hearing, 

Oluwafunmilayo (Funmi) Taylor, (202) 

317–6901 (not toll-free numbers). 

SUPPLEMENTARY INFORMATION: 

Background and Explanation of 

Provisions 

1. Introduction 

This document contains proposed 

amendments to 26 CFR part 1 under 

section 1502 of the Internal Revenue 

Code (Code). Section 1502 authorizes 

the Secretary to prescribe regulations for 

corporations that join in filing 

consolidated returns to reflect clearly 

the income tax liability of the group and 

to prevent avoidance of such tax 

liability, and provides that these rules 

may be different from the provisions of 

chapter 1 of subtitle A of the Code that 

would apply if the corporations filed 

separate returns. Terms used in the 

consolidated return regulations 

generally are defined in § 1.1502–1. 

These proposed regulations would 

provide guidance regarding the 

absorption of members’ losses in a 

consolidated return year, and provide 

guidance to eliminate the ‘‘circular basis 

problem’’ in a broader class of 

transactions than under current law. 

This document also contains 

proposed conforming amendments to 26 

CFR part 301 under section 6402. 

Section 6402 authorizes the Secretary to 

make credits and refunds. The proposed 

regulations would amend § 301.6402– 

7(g) (relating to claims for refunds and 

application for tentative carryback 

adjustments involving consolidated 

groups that include financial 

institutions) by revising the definition of 

separate net operating loss of a member 

in light of the proposed amendments to 

§ 1.1502–21 (relating to the 

determination and treatment of 

consolidated and separate net operating 

losses, carrybacks, and carryovers). 

2. Allocation and Absorption of 

Members’ Losses 

In general, the consolidated taxable 

income (CTI) or consolidated net 

operating loss (CNOL) of a consolidated 

group is the sum of each member’s 

separately computed taxable income or 

loss (computed pursuant to § 1.1502–12) 

and certain items of income and 

deduction that are computed on a 

consolidated basis pursuant to § 1.1502– 

11. 

Section 1.1502–21(b)(2)(i) (relating to 

carryovers and carrybacks of CNOLs to 

separate return years) provides generally 

that if a group has a CNOL and a portion 

of the CNOL would be carried to a 


Lhorne on DSK2VPTVN1PROD with PROPOSALS