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

95724 

Vol. 89, No. 232 

Tuesday, December 3, 2024 

DEPARTMENT OF AGRICULTURE 

Food and Nutrition Service 

7 CFR Part 273 

[FNS–2024–0029] 

RIN 0584–AF04 

Supplemental Nutrition Assistance 

Program: Thrifty Food Plan Cost 

Adjustment for the Price of Food in 

Hawaii 

AGENCY: Food and Nutrition Service 

(FNS), USDA. 

ACTION: Proposed rule. 

SUMMARY: The Food and Nutrition 

Service (FNS) is proposing changes to 

Supplemental Nutrition Assistance 

Program (SNAP) regulations in 

accordance with the Food and Nutrition 

Act of 2008, which calls for a cost 

adjustment in the Thrifty Food Plan 

(TFP) for Hawaii to reflect the cost of 

food in Hawaii. The proposal would 

update the method for calculating this 

cost adjustment to incorporate food 

prices from throughout the State of 

Hawaii rather than from Honolulu 

alone, ensuring that SNAP benefit 

allotments better reflect food prices 

faced by participants throughout the 

State of Hawaii. 

DATES: Written comments must be 

received on or before February 3, 2025 

to be assured of consideration. 

ADDRESSES: The Food and Nutrition 

Service, USDA, invites interested 

persons to submit written comments on 

this proposed rule. Comments may be 

submitted in writing by one of the 

following methods: 

• Federal eRulemaking Portal: Go to 

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

online instructions for submitting 

comments. 

• Mail: Send comments to Kevin 

Meyers Mathieu, Economic Advisor, 

Nutrition Guidance and Analysis 

Division, Center for Nutrition Policy 

and Promotion, Food and Nutrition 

Service, U.S. Department of Agriculture, 

1320 Braddock Place, Fourth Floor, 

Alexandria, VA 22314. 

• Website: Go to http://

www.regulations.gov. Follow the online 

instructions for submitting comments. 

• Email: Send comments to 

FNS.FoodPlans@usda.gov. 

• All written comments submitted in 

response to this proposed rule will be 

included in the record and will be made 

available to the public. Please be 

advised that the substance of the 

comments and the identity of the 

individuals or entities submitting the 

comments will be subject to public 

disclosure. FNS will make the written 

comments publicly available on the 

internet via http://www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: 

Kevin Meyers Mathieu, Economic 

Advisor, Nutrition Guidance and 

Analysis Division, Center for Nutrition 

Policy and Promotion, Food and 

Nutrition Service, U.S. Department of 

Agriculture, 1320 Braddock Place, 

Fourth Floor, Alexandria, VA 22314, 

703–946–7619 or FNS.FoodPlans@

usda.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The Thrifty Food Plan (TFP) is one of 

four Food Plans the Department of 

Agriculture (USDA or the Department) 

develops that estimates the cost of a 

healthy diet across various price 

points—the Thrifty, Low-Cost, 

Moderate-Cost and Liberal Food Plans. 

The TFP is the lowest cost of the four 

and represents a nutritious, practical, 

and cost-effective diet. The foundation 

of the TFP is a set of market baskets 

applicable to various age-sex groups that 

outline nutrient-dense foods and 

beverages, their amounts, and associated 

costs that can be purchased on a limited 

budget to support a healthy diet through 

nutritious meals and snacks at home. 

The cost of the TFP is based on a 

reference family of four, defined by the 

Food and Nutrition Act of 2008 (the 

Act) (7 U.S.C. 2012(u)) as consisting of 

a man and a woman twenty through 

fifty, a child six through eight, and a 

child nine through eleven years of age. 

The TFP is used to determine 

Supplemental Nutrition Assistance 

Program (SNAP) benefit amounts. The 

Act (7 U.S.C. 2012(u)(4)) requires the 

cost of the TFP in June to serve as the 

basis for setting maximum SNAP benefit 

allotments in the following Federal 

fiscal year (October 1 through 

September 30). SNAP allotments for 

households of different sizes are 

calculated proportional to the 

allotments for the reference family of 

four with economies-of-scale 

adjustments. 

The Act (7 U.S.C. 2012(u)(2)) also 

calls for cost adjustments to the TFP to 

reflect the cost of food in Hawaii. 

Requirements at 7 CFR 273.10(e)(4)(i) 

further specify that this cost adjustment 

reflect the price of food in Honolulu. 

The calculation and implementation of 

this cost adjustment are separate from 

the reevaluation of the TFP market 

basket; the cost adjustment is not 

required to be updated when the TFP 

market basket is reevaluated every five 

years. The extent of regional food price 

variation may vary across different 

foods and beverages. As a result, 

changes to the underlying TFP market 

basket resulting from the required 2021 

TFP reevaluation present an 

opportunity to update the cost 

adjustment for Hawaii. Although not 

required, updating the cost adjustment 

for Hawaii following the TFP 

reevaluation is intended to maintain 

equivalence between the purchasing 

power of SNAP benefit allotments in 

Hawaii and in the mainland United 

States. 

Beginning in the early 1970s, TFP 

costs for Hawaii were calculated as the 

cost of the TFP in the contiguous 48 

States and the District of Columbia 

(hereafter referred to as the ‘‘mainland 

United States’’) adjusted for the price of 

food in Honolulu. Evidence suggests 

that Honolulu was used as the basis for 

the original price-of-food adjustments 

because it was the only location in 

Hawaii where the Bureau of Labor 

Statistics (BLS) routinely collected food 

price information. FNS subsequently 

used BLS food price information 

collected for the Consumer Price Index 

(CPI) as the basis for the TFP cost for 

Hawaii through 1977. 

In 1978, BLS made major changes in 

the methods for collecting food price 

data in the United States, thereby 

hindering the construction of price-offood adjustments for Honolulu using 

BLS data. With the need for an alternate 

data source, FNS incorporated data 

collected in Hawaii from the 1977–1978 

Nationwide Food Consumption Survey 

(NFCS) into a reevaluation of the TFP in 

the early 1980s. The NFCS-based 


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Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 / Proposed Rules 95725 

1https://www.fns.usda.gov/cnpp/thrifty-foodplan-2021. 

2https://www.fns.usda.gov/cnpp/tfp-akhi. 

3https://www.fns.usda.gov/cnpp/statewide-tfp-hi2024. 

Hawaii TFP cost was subsequently 

updated for inflation using the 

semiannual CPIs for Urban Hawaii 

through June 2021. 

As directed by Congress in the 

Agricultural Improvement Act of 2018, 

FNS published an evidence-driven 

reevaluation of the TFP to reflect 

current food prices, food composition 

data, consumption patterns, and dietary 

guidance. The reevaluation, published 

in August 2021,1 defined the content of 

the TFP market baskets for 15 age-sex 

groups, as well as their costs in the 

mainland United States. After 

accounting for inflation, the 

reevaluation led to a 21.03 percent 

increase in the TFP cost for the 

mainland United States. 

FNS used the 21.03-percent increase 

in the inflation-adjusted cost of the TFP 

in the mainland United States 

associated with the 2021 TFP 

reevaluation as the basis for a temporary 

adjustment to the TFP cost for Hawaii 

beginning in June 2021. The application 

of the temporary adjustment effectively 

held the cost adjustment for Hawaii (i.e., 

the percentage difference between the 

TFP cost for Hawaii and the TFP cost for 

the mainland United States) constant 

despite the change in underlying market 

baskets. This TFP cost for Hawaii, 

inclusive of the temporary adjustment, 

was subsequently adjusted for inflation 

to reflect June 2022 price levels using 

the CPIs for Urban Hawaii while FNS 

conducted additional analysis of the 

TFP cost for Hawaii. 

In July 2023, FNS published the 

Thrifty Food Plan Cost Estimates for 

Alaska and Hawaii report,2 which 

calculated a TFP cost estimate for 

Hawaii based on the most current 

information available. The report 

detailed the identification of a data 

source and the development and 

application of a price index to these 

data in alignment with the statutory and 

regulatory framework. The report was 

peer reviewed by experts at USDA as 

well as six researchers outside of the 

Federal Government with demonstrated 

knowledge and expertise in price 

indexes, scanner data, and the TFP. The 

report provides detailed information on 

the four existing price indexes and the 

four existing food price data sources 

that FNS considered, as well as FNS’ 

approach for evaluating each option. 

FNS identified Circana (formerly 

Information Resources Inc., or IRI) retail 

scanner data as the best available data 

to support the calculation of new TFP 

cost estimates based on sample size; 

applicability to the TFP, 2021; data 

quality and documentation; 

appropriateness as a price-of-food 

adjustment; and the applicability to 

future updates and reevaluations. FNS 

used Circana retail scanner data from 

over 40,000 stores in the mainland 

United States and 32 stores in Honolulu, 

including sales at these stores for over 

11,000 unique food and beverage 

products, to calculate an updated TFP 

cost estimate for Hawaii using a 

bilateral, fixed-basket price index. FNS 

used this index-based approach to 

calculate an updated TFP cost for 

Hawaii rather than the optimization 

model approach used to conduct TFP 

reevaluations because the use of an 

optimization model would have 

resulted in the creation of a new market 

basket, which would not align with the 

Act (7 U.S.C. 2012(u)(2)), which calls for 

an adjustment for the cost of food, 

exclusively. The analysis resulted in an 

updated estimate of the percent 

difference in the cost of purchasing the 

foods and beverages in the TFP, 2021 

market basket between Honolulu and 

the mainland United States, which was 

applied to the cost of the TFP in the 

mainland United States to yield an 

updated TFP cost estimate for Hawaii. 

FNS is currently transitioning to using 

the updated TFP cost estimate for 

Hawaii published in the 2023 report as 

the basis of the maximum SNAP 

allotment in Hawaii. 

On January 19, 2024, FNS posted a 

Request for Information (RFI) in the 

Federal Register (89 FR 3633) 

requesting comments from the public— 

including the food industry and 

research community—to help inform 

future policy and decisions about 

potentially updating TFP cost estimates 

for the State of Hawaii. Concurrent with 

its publication, FNS conducted 

extensive outreach to stakeholders in 

Hawaii to spread awareness of and 

encourage responses to the RFI, 

including by notifying national and 

local organizations, universities, Federal 

agencies, and every SNAP-approved 

retailer in the State for which SNAP had 

a valid email address (approximately 

510 retailers). The comment period 

closed on March 4, 2024, with FNS 

receiving a total of 12 comments from a 

Federal agency, an academic, a SNAP 

participant, three advocacy/non-profit 

organizations, an industry association, 

three retailers (with one retailer 

providing two comments), and one 

anonymous respondent. 

The comments consistently indicated 

that food prices are higher in the 

Neighbor Islands than in Honolulu. A 

key rationale for the higher relative 

prices in the Neighbor Islands provided 

by the comments is that nearly all foods 

and beverages sold in Hawaii are 

imported from out of State, with these 

shipments first arriving in Honolulu and 

then being distributed out to the 

Neighbor Islands. This additional 

distribution step adds to the cost of 

foods and beverages in the Neighbor 

Islands which is then reflected in retail 

prices. Several comments suggested that 

many residents of the Neighbor Islands 

in rural and remote areas of the State do 

not live in proximity to club stores, 

which tend to offer lower unit prices for 

foods and beverages purchased in larger 

quantities. While club stores operate in 

urban areas on the Neighbor Islands, the 

comments noted that not all residents of 

the Neighbor Islands are able to 

consistently access these stores. 

The comments also consistently 

expressed that a TFP cost for the State 

of Hawaii based on data from Honolulu 

alone underestimates the true cost of a 

healthy, practical, cost-effective diet in 

the State. Therefore, the respondents 

argued, current SNAP regulations that 

adjust for the cost of food in Honolulu 

lead to an inequitable maximum 

allotment level for SNAP participants in 

the Neighbor Islands. 

FNS proposes to revise regulations at 

7 CFR 273.10(e)(4)(i) to align with the 

Act (7 U.S.C. 2012(u)(2)) and base the 

cost of the TFP in Hawaii on an 

adjustment for the price of food in the 

State of Hawaii rather than an 

adjustment for the price of food in 

Honolulu. 

FNS conducted analyses to develop a 

TFP cost estimate for Hawaii that would 

align with the proposed regulatory 

framework using the best currently 

available data on food prices. The 

analysis, which uses the same peerreviewed methodology as the original 

Honolulu analysis published in 2023, is 

documented in a separately published 

scientific report.3 The analysis is also 

based on Circana retail scanner data, 

which provides sales data from the 32 

stores included in FNS’ original analysis 

of food prices in Honolulu and 65 

additional stores from throughout the 

State of Hawaii. Including these 

additional stores also enables the 

analysis to consider food prices for 

approximately 700 (6%) more unique 

food and beverage products. 

The proposed changes at 7 CFR 

273.10(e)(4)(i) would revise the 

regulatory framework for Hawaii’s TFP 

cost without establishing a specific 

dollar value or a specific price-of-food 

adjustment for Hawaii. The Hawaii TFP 

cost will continue to be based on the 


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95726 Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 / Proposed Rules 

best available food price data and may 

be updated in the future at the 

Secretary’s discretion. To support 

continuous quality advancement, FNS 

continues to explore food price data 

sources for the State of Hawaii. 

Procedural Matters 

Executive Order 12866, 13563 and 

14094 

Executive Orders 12866, 13563, and 

14094 direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. This 

proposed rule has been determined to 

be not significant and was not reviewed 

by the Office of Management and 

Budget (OMB) in conformance with 

Executive Order 12866. 

Regulatory Impact Analysis 

This rule has been designated as not 

significant by the Office of Management 

and Budget, therefore, no Regulatory 

Impact Analysis is required. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601–612) requires Agencies to 

analyze the impact of rulemaking on 

small entities and consider alternatives 

that would minimize any significant 

impacts on a substantial number of 

small entities. Pursuant to that review, 

it has been certified that this rule would 

not have a significant impact on a 

substantial number of small entities. 

Congressional Review Act 

Pursuant to the Congressional Review 

Act (5 U.S.C. 801 et seq.), the Office of 

Information and Regulatory Affairs 

designated this rule as not a ‘major rule’, 

as defined by 5 U.S.C. 804(2). 

Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA), Public 

Law 104–4, establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on State, local 

and tribal governments and the private 

sector. Under section 202 of the UMRA, 

the Department generally must prepare 

a written statement, including a cost 

benefit analysis, for proposed and final 

rules with ‘‘Federal mandates’’ that may 

result in expenditures by State, local or 

tribal governments, in the aggregate, or 

the private sector, of $100 million or 

more in any one year. When such a 

statement is needed for a rule, Section 

205 of the UMRA generally requires the 

Department to identify and consider a 

reasonable number of regulatory 

alternatives and adopt the most cost 

effective or least burdensome alternative 

that achieves the objectives of the rule. 

This proposed rule does not contain 

Federal mandates (under the regulatory 

provisions of Title II of the UMRA) for 

State, local and tribal governments or 

the private sector of $100 million or 

more in any one year. Thus, the rule is 

not subject to the requirements of 

sections 202 and 205 of the UMRA. 

Executive Order 12372 

This Supplemental Nutrition 

Assistance Program is listed in the 

Catalog of Federal Domestic Assistance 

under Number 10.551 and is subject to 

Executive Order 12372, which requires 

intergovernmental consultation with 

State and local officials. (See 2 CFR 

chapter IV.) 

Federalism Summary Impact Statement 

Executive Order 13132 requires 

Federal agencies to consider the impact 

of their regulatory actions on State and 

local governments. Where such actions 

have federalism implications, agencies 

are directed to provide a statement for 

inclusion in the preamble to the 

regulations describing the agency’s 

considerations in terms of the three 

categories called for under Section 

(6)(b)(2)(B) of Executive Order 13132. 

The Department has considered the 

impact of this rule on State and local 

governments and has determined that 

this rule does not have federalism 

implications. Therefore, under section 

6(b) of the Executive Order, a federalism 

summary is not required. 

Executive Order 12988, Civil Justice 

Reform 

This proposed rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This rule is intended to 

have preemptive effect with respect to 

any State or local laws, regulations or 

policies which conflict with its 

provisions or which would otherwise 

impede its full and timely 

implementation. This rule/is not 

intended to have retroactive effect 

unless so specified in the Effective Dates 

section of the final rule. Prior to any 

judicial challenge to the provisions of 

the final rule, all applicable 

administrative procedures must be 

exhausted. 

Civil Rights Impact Analysis 

FNS has reviewed this proposed rule 

in accordance with USDA Regulation 

4300–4, ‘‘Civil Rights Impact Analysis,’’ 

to identify any major civil rights 

impacts the rule might have on program 

participants on the basis of age, race, 

color, national origin, sex or disability. 

After a careful review of the rule’s intent 

and provisions, FNS has determined 

that this rule is not expected to affect 

the participation of protected 

individuals in SNAP. 

Executive Order 13175 

Executive Order 13175 requires 

Federal agencies to consult and 

coordinate with Tribes on a 

government-to-government basis on 

policies that have Tribal implications, 

including regulations, legislative 

comments or proposed legislation, and 

other policy statements or actions that 

have substantial direct effects on one or 

more Indian Tribes, on the relationship 

between the Federal Government and 

Indian Tribes, or on the distribution of 

power and responsibilities between the 

Federal Government and Indian Tribes. 

• We are unaware of any current 

Tribal laws that could be in conflict 

with this rule. 

Paperwork Reduction Act 

The Paperwork Reduction Act of 1995 

(44 U.S.C. Chap. 35; 5 CFR 1320) 

requires the Office of Management and 

Budget (OMB) approve all collections of 

information by a Federal agency before 

they can be implemented. Respondents 

are not required to respond to any 

collection of information unless it 

displays a current valid OMB control 

number. 

This rule does not contain 

information collection requirements 

subject to approval by the Office of 

Management and Budget under the 

Paperwork Reduction Act of 1994. 

E-Government Act Compliance 

The Department is committed to 

complying with the E-Government Act, 

to promote the use of the internet and 

other information technologies to 

provide increased opportunities for 

citizen access to Government 

information and services, and for other 

purposes. 

List of Subjects in 7 CFR Part 273 

Administrative practice and 

procedure, Supplemental Nutrition 

Assistance Program, Thrifty Food Plan. 

Accordingly, 7 CFR part 273 is 

proposed to be amended as follows: 


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Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 / Proposed Rules 95727 

PART 273.10—DETERMINING 

HOUSEHOLD ELIGIBILITY AND 

BENEFIT LEVELS 

■ 1. The authority citation for part 273 

continues to read as follows: 

Authority: 7 U.S.C. 2011–2036. 

■ 2. In § 273.10, amend paragraph 

(e)(4)(i) to remove the word ‘‘Honolulu’’ 

and adding in its place ‘‘Hawaii’’. 

Tameka Owens, 

Acting Administrator and Assistant 

Administrator, Food and Nutrition Service. 

[FR Doc. 2024–27853 Filed 12–2–24; 8:45 am] 

BILLING CODE 3410–30–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[REG–106595–22] 

RIN 1545–BQ83 

Substantiation Requirements and 

Qualified Nonpersonal Use Vehicles 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document sets forth 

proposed regulations relating to the 

definition of qualified nonpersonal use 

vehicles. Qualified nonpersonal use 

vehicles are excepted from the 

substantiation requirements that apply 

to certain listed property. These 

proposed regulations add unmarked 

vehicles used by firefighters or members 

of a rescue squad or ambulance crew as 

a new type of qualified nonpersonal use 

vehicle. These regulations affect 

governmental units that provide 

firefighter or rescue squad or ambulance 

crew member employees with 

unmarked qualified nonpersonal use 

vehicles and the employees who use 

those vehicles. 

DATES: Written or electronic comments 

and requests for a public hearing must 

be received by March 3, 2025. 

ADDRESSES: Commenters are strongly 

encouraged to submit public comments 

electronically via the Federal 

eRulemaking Portal at http://

www.regulations.gov (indicate IRS and 

REG–106595–22) by following the 

online instructions for submitting 

comments. Requests for a public hearing 

must be submitted as prescribed in the 

‘‘Comments and Requests for a Public 

Hearing’’ section. Once submitted to the 

Federal Rulemaking Portal, comments 

cannot be edited or withdrawn. The 

Department of the Treasury (Treasury 

Department) and the IRS will publish 

for public availability any comment 

submitted electronically or on paper, to 

the IRS’s public docket. Send paper 

submissions to CC:PA:01:PR (REG– 

106595–22), Room 5203, Internal 

Revenue Service, P.O. Box 7604, Ben 

Franklin Station, Washington, DC 

20044. 

FOR FURTHER INFORMATION CONTACT: 

Concerning the proposed regulations, 

Stephanie Caden at (202) 317–4750; 

concerning submissions of comments or 

requests for a public hearing, the 

Publications and Regulations section by 

email at publichearings@irs.gov 

(preferred) or (202) 317–6901 (not tollfree numbers). 

SUPPLEMENTARY INFORMATION: 

Authority 

This notice of proposed rulemaking 

contains proposed regulations issued 

under the authority granted to the 

Secretary of the Treasury or her delegate 

(Secretary) by sections 274(p) and 

132(o) of the Internal Revenue Code 

(Code) that would amend the Income 

Tax Regulations (26 CFR part 1) under 

sections 274(i) and 132(d) related to 

qualified nonpersonal use vehicles. 

Section 274(p) provides the Secretary 

with an express grant of regulatory 

authority with respect to section 274 as 

the Secretary may deem necessary to 

carry out the purposes of that section. 

Section 132(o) provides the Secretary 

with an express grant of regulatory 

authority with respect to section 132 to 

prescribe such regulations as may be 

necessary or appropriate to carry out the 

purposes of that section. In addition, 

section 7805(a) authorizes the Secretary 

to prescribe all needful rules and 

regulations for the enforcement of the 

Code. 

Background 

In general, section 274 limits or 

disallows deductions for certain 

expenditures that otherwise would be 

allowable under chapter 1 of the Code, 

primarily under section 162(a), which 

allows a deduction for ordinary and 

necessary expenses paid or incurred 

during the taxable year in carrying on 

any trade or business. 

Section 274(d), as relevant to these 

proposed regulations, provides that a 

taxpayer is not allowed a deduction or 

credit for certain expenses unless the 

expenses are substantiated by adequate 

records or by sufficient evidence 

corroborating the taxpayer’s own 

statement as to the amount, time and 

place, business purposes of the 

expenditure, and the business 

relationship to the taxpayer of the 

person receiving the benefit. These 

substantiation requirements apply to 

expenses incurred in the use of any 

listed property, as defined in section 

280F(d)(4), which includes any 

passenger automobile and any other 

property used as a means of 

transportation. 

In 1985, Congress modified section 

274(d) and added section 274(i), 

creating an exception from the 

substantiation requirements for 

qualified nonpersonal use vehicles. 

Public Law 99–44 2, 99 Stat. 77 (1985). 

Section 274(i) provides that the term 

‘‘qualified nonpersonal use vehicle’’ 

means any vehicle, which by reason of 

its nature, is not likely to be used more 

than a de minimis amount for personal 

purposes. 

Both the business and personal use of 

an employer-provided vehicle that is a 

qualified nonpersonal use vehicle under 

section 274(i) qualifies under section 

132(d) as a working condition fringe 

benefit that is excluded from the 

employee’s income. Thus, if an 

employer provides an employee with a 

qualified nonpersonal use vehicle, the 

employee does not need to keep records 

of how the vehicle is used, and the total 

use of the vehicle is excluded from the 

employee’s income as a working 

condition fringe benefit under section 

132(d). See §§ 1.132–5(h) and 1.274– 

5(k). 

The legislative history to section 

274(i) includes examples of qualified 

nonpersonal use vehicles such as school 

buses, qualified specialized utility 

repair trucks, qualified moving vans, 

clearly marked police and fire vehicles, 

and unmarked law enforcement 

vehicles. H.R. Rep. No. 99–67, at 16 

(1985) (Conf. Rep.). The legislative 

history indicates that Congress intended 

the IRS and the Treasury Department to 

expand the list to include other vehicles 

that, by reason of their nature, are 

highly unlikely to be used more than a 

very minimal amount for personal 

purposes. H.R. Rep. No. 99–34, at 11 

(1985). 

Temporary Regulations § 1.274–5T(k) 

and (l) were issued in 1985, identifying 

categories of qualified nonpersonal use 

vehicles and providing definitions (by 

cross reference) of terms such as 

‘‘automobile,’’ ‘‘vehicle,’’ and ‘‘personal 

use.’’ TD 8061, 50 FR 46006, 46033, and 

46036. Police and fire vehicles that are 

clearly marked and law enforcement 

vehicles that are unmarked were 

included as categories of qualified 

nonpersonal use vehicles. However, 

clearly marked vehicles provided to 

Federal, State, and local government 

workers who respond to emergency 

situations as public safety officers but 


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