13292 Federal Register / Vol. 80, No. 49 / Friday, March 13, 2015 / Proposed Rules 

Current regulations Proposed revisions to regulations 

If before the expiration of the 30-month period, or 71⁄2 years where applicable: 

• (ii) the court issues a final order that the patent is invalid, unenforceable, or not infringed, approval may be made effective on: 

— the date the court enters judgment; 

• (iii) the court issues a final order or judgment that the patent has 

been infringed, approval may be made effective on: 

— the date the court determines that the patent will expire or 

otherwise orders 

• (iv) the court grants a preliminary injunction prohibiting the applicant from engaging in the commercial manufacture or sale of the 

drug product until the court decides the issues of patent validity 

and infringement, and if the court later decides that the patent is 

invalid, unenforceable, or not infringed, approval may be made 

effective on: 

— the date the court enters a final order or judgment that the 

patent is invalid, unenforceable, or not infringed. 

If before the expiration of the 30-month period, or 71⁄2 years where applicable: 

• (ii) the district court decides that the patent is invalid, unenforceable, or not infringed (including any substantive determination 

that there is no cause of action for patent infringement or invalidity), the 505(b)(2) application or ANDA may be approved on: 

—(A) the date on which the court enters judgment reflecting 

the decision; or 

—(B) the date of a settlement order or consent decree signed 

and entered by the court stating that the patent that is the 

subject of the certification is invalid or not infringed. 

• (iii) the district court decides that the patent has been infringed 

and the judgment is appealed, the 505(b)(2) application or 

ANDA may be approved on: 

—(A) the date on which the mandate is issued by the court of 

appeals entering judgment that the patent is invalid or not 

infringed; or 

—(B) the date of a settlement order or consent decree signed 

and entered by the court of appeals stating that the patent 

is invalid or not infringed. 

• (iv) the district court decides that the patent has been infringed 

and the judgment is not appealed or is affirmed, the 505(b)(2) 

application or ANDA may be approved no earlier than the date 

specified by the district court in an order under 35 U.S.C. 

271(e)(4)(A). 

• (v) the district court grants a preliminary injunction prohibiting 

the applicant from engaging in the commercial manufacture or 

sale of the drug product until the court decides the issues of patent validity and infringement: 

— if the court later decides the patent is invalid, unenforceable, or not infringed, the 505(b)(2) application or ANDA 

may be approved per § 314.107(b)(3)(ii). 

—if the court decides that the patent has been infringed, the 

505(b)(2) application or ANDA may be approved per 

§ 314.107(b)(3)(iii) or (b)(3)(iv), as applicable. 

• (vi) the patent owner or the exclusive patent licensee (or their 

representatives) agrees in writing that the 505(b)(2) application 

or ANDA may be approved any time on or after the date of the 

consent, approval may be granted on or after that date. 

• (vii) the court enters an order requiring the 30-month or 71⁄2-year 

period to be terminated, the 505(b)(2) application or ANDA may 

be approved in accordance with the court’s order. 

• (viii) the court enters an order of dismissal, with or without prejudice, without a finding of infringement, the 505(b)(2) application 

or ANDA may be approved on or after the date of the order. 

[FR Doc. C1–2015–01666 Filed 3–12–15; 8:45 am] 

BILLING CODE 1505–01–D 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[REG–143040–14] 

RIN 1545–BM59 

Reporting of Original Issue Discount 

on Tax-Exempt Obligations; Basis and 

Transfer Reporting by Securities 

Brokers for Debt Instruments and 

Options 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking 

by cross-reference to temporary 

regulations. 

SUMMARY: In the Rules and Regulations 

section of this issue of the Federal 

Register, the IRS is issuing temporary 

regulations relating to information 

reporting by brokers for transactions 

involving debt instruments and options, 

including the reporting of original issue 

discount (OID) and acquisition premium 

on tax-exempt obligations, the treatment 

of certain holder elections for reporting 

a taxpayer’s adjusted basis in a debt 

instrument, and transfer reporting for 

section 1256 options and debt 

instruments. The text of those 

regulations also serves as the text of 

these proposed regulations. 

DATES: Written or electronic comments 

must be received by June 11, 2015. 

ADDRESSES: Send submissions to: 

CC:PA:LPD:PR (REG–143040–14), 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–143040– 

14), Courier’s Desk, Internal Revenue 

Service, 1111 Constitution Avenue NW., 

Washington, DC, or sent electronically 

via the Federal eRulemaking Portal at 

www.regulations.gov (IRS REG–143040– 

14). 

FOR FURTHER INFORMATION CONTACT: 

Concerning the proposed regulations, 

Pamela Lew, (202) 317–7053; 

concerning submissions of comments, 

Regina Johnson, (202) 317–6901 (not 

toll-free numbers). 

SUPPLEMENTARY INFORMATION: 


tkelley on DSK3SPTVN1PROD with PROPOSALS
Federal Register / Vol. 80, No. 49 / Friday, March 13, 2015 / Proposed Rules 13293 

Paperwork Reduction Act 

Section 1.6049–10T, which is 

published elsewhere in this issue of the 

Federal Register, requires a payor to 

report OID and acquisition premium on 

tax-exempt obligations acquired on or 

after January 1, 2017. This information 

is required to enable the IRS to verify 

that a taxpayer is reporting the correct 

amount of tax-exempt interest each year 

for alternative minimum tax and other 

purposes. In addition, because this 

information is used to report a 

taxpayer’s adjusted basis in a debt 

instrument under section 6045(g), this 

information is required to enable the 

IRS to verify that a taxpayer is reporting 

the correct amount of gain or loss upon 

the sale of a tax-exempt obligation. The 

burden for the collection of information 

contained in § 1.6049–10T and the 

corresponding proposed regulations in 

this document will be reflected in the 

burden on Form 1099–OID (OMB 

control number 1545–0117) when 

revised to request the additional 

information in the regulations. 

Upon the transfer of a covered 

security, section 6045A and § 1.6045A– 

1 require the transferring broker to 

provide to the transferee broker a 

transfer statement containing certain 

information relating to the security. This 

transfer statement generally provides 

the transferee broker the information 

needed to determine a customer’s 

adjusted basis and whether any gain or 

loss with respect to the security is longterm, short-term, or ordinary as required 

by section 6045(g). Prior to the 

publication of § 1.6045A–1T in this 

issue of the Federal Register, a broker 

did not have to provide a transfer 

statement for a section 1256 option. In 

addition, a broker did not have to 

provide the last date on or before the 

transfer date that the broker made an 

adjustment for a particular item relating 

to a debt instrument. Section 1.6045A– 

1T, however, now requires a broker to 

transfer this information for a section 

1256 option transferred on or after 

January 1, 2016, and for a debt 

instrument transferred on or after June 

30, 2015. 

The collection of information 

contained in section 1.6045A–1 relating 

to the furnishing of information in 

connection with the transfer of 

securities has been reviewed and 

approved by the Office of Management 

and Budget in accordance with the 

Paperwork Reduction Act of 1995 (44 

U.S.C. 3507(d)) under control number 

1545–2186. The collection of 

information in § 1.6045A–1T and the 

corresponding proposed regulations in 

this document is necessary to allow 

brokers that effect sales of transferred 

section 1256 options and debt 

instruments that are covered securities 

to determine and report the adjusted 

basis of these securities in compliance 

with section 6045(g). This collection of 

information is required to comply with 

the provisions of section 403 of the 

Energy Improvement and Extension Act 

of 2008, Division B of Public Law 110– 

343 (122 Stat. 3765, 3854 (2008)) (the 

Act). The collection of information 

contained in § 1.6045A–1T is an 

increase in the total annual burden 

under control number 1545–2186. The 

likely respondents are brokers 

transferring section 1256 options and 

debt instruments that are covered 

securities. 

Estimated total annual reporting 

burden is 3,333 hours. 

Estimated average annual burden per 

respondent is 2 hours. 

Estimated average burden per 

response is 4 minutes. 

Estimated number of respondents is 

7,500. 

Estimated total frequency of responses 

is 200,000. 

The collection of information is 

required to comply with the provisions 

of section 403 of the Act. 

The holder of a debt instrument is 

permitted to make a number of elections 

that affect how basis is computed. To 

minimize the need for reconciliation 

between information reported by a 

broker to both a customer and the IRS 

and the amounts reported on the 

customer’s tax return, a broker is 

required to take into account certain 

specified elections in reporting 

information to the customer. A 

customer, therefore, must provide 

certain information concerning an 

election to the broker in a written 

notification. A written notification 

includes a writing in electronic format. 

See § 1.6045–1(n)(5). 

The collection of information 

contained in § 1.6045–1(n)(5) relating to 

the furnishing of information by a 

customer to a broker in connection with 

the sale or transfer of a debt instrument 

that is a covered security has been 

reviewed and approved by the Office of 

Management and Budget in accordance 

with the Paperwork Reduction Act of 

1995 (44 U.S.C. 3507(d)) under control 

number 1545–2186. Under § 1.6045– 

1T(n)(11)(i)(A), which is published 

elsewhere in this issue of the Federal 

Register, unlike the rule in current 

§ 1.6045–1(n)(5) adopted in 2013, a 

broker must not take into account the 

election under § 1.1272–3 in reporting a 

customer’s adjusted basis in a debt 

instrument. Therefore, a customer is no 

longer required to notify the broker that 

the customer has made or revoked an 

election under § 1.1272–3. This change 

represents a decrease in the total annual 

burden under OMB control number 

1545–2186. In addition, under § 1.6045– 

1T(n)(11)(i)(B), a broker must take into 

account the election under section 

1276(b)(2) unless the customer timely 

notifies the broker that the customer has 

not make the election. The temporary 

regulations reverse the assumption in 

current § 1.6045–1(n)(5) adopted in 

2013. Because the section 1276(b)(2) 

election results in a more taxpayerfavorable result than the default ratable 

method for accruing market discount in 

most cases, it is anticipated that more 

customers will want to use this method 

and these customers will no longer need 

to notify their brokers that they have 

made the election. As a result, this 

change represents a decrease in the total 

annual burden under OMB control 

number 1545–2186. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a valid control 

number assigned by the Office of 

Management and Budget. 

Books or records relating to a 

collection 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 tax return information 

are confidential, as required by section 

6103. 

Background and Explanation of 

Provisions 

Section 6045 generally requires a 

broker to report gross proceeds upon the 

sale of a security. Section 6045 was 

amended by section 403 of the Act to 

require the reporting of adjusted basis 

for a covered security and whether any 

gain or loss upon the sale of the security 

is long-term or short-term. In addition, 

the Act added section 6045A, which 

requires certain information to be 

reported in connection with a transfer of 

a covered security to another broker. 

Section 6049 requires the reporting of 

interest payments (including accruals of 

OID treated as payments). 

On April 18, 2013, the Treasury 

Department and the IRS published in 

the Federal Register (TD 9616 at 78 FR 

23116) final regulations under sections 

6045 and 6045A (the 2013 final basis 

reporting regulations). After the 

publication of the 2013 final basis 

reporting regulations in the Federal 

Register, the Treasury Department and 

the IRS received written comments on 

certain provisions of the 2013 final basis 

reporting regulations. In response to 

these written comments, temporary 


tkelley on DSK3SPTVN1PROD with PROPOSALS
13294 Federal Register / Vol. 80, No. 49 / Friday, March 13, 2015 / Proposed Rules 

regulations in the Rules and Regulations 

section of this issue of the Federal 

Register amend the Income Tax 

Regulations (26 CFR part 1) relating to 

sections 6045, 6045A, and 6049. The 

temporary regulations (1) amend 

§ 1.6045–1(n) of the 2013 final basis 

reporting regulations to change a 

broker’s treatment of the election to treat 

all interest as OID under § 1.1272–3 and 

the election to accrue market discount 

based on a constant yield under section 

1276(b)(2), (2) amend § 1.6045A–1 of the 

2013 final basis reporting regulations to 

require transfer statement reporting 

under section 6045A for section 1256 

options, (3) amend § 1.6045A–1 of the 

2013 final basis reporting regulations to 

require an additional item of 

information to be provided on transfer 

statements for debt instruments, and (4) 

require information reporting under 

section 6049 for OID and acquisition 

premium on tax-exempt obligations. 

The text of the temporary regulations 

also serves as the text of these proposed 

regulations. 

Consideration of Administrative 

Burdens Related to Basis Reporting 

A number of commenters have 

indicated that compliance with basis 

reporting requirements and the use of 

basis and other information reported by 

brokers will require considerable 

resources and effort on the part of return 

preparers and information recipients. 

The Treasury Department and the IRS 

are continuing to review all aspects of 

the information reporting process and 

are exploring ways to reduce the 

compliance burden for both brokers and 

for information recipients. 

Special Analyses 

It has been determined that this notice 

of proposed rulemaking is not a 

significant regulatory action as defined 

in Executive Order 12866, as 

supplemented by Executive Order 

13563. Therefore, a regulatory 

assessment is not required. It also has 

been determined that section 553(b) of 

the Administrative Procedure Act (5 

U.S.C. chapter 5) does not apply to these 

regulations. 

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. Therefore, a 

Regulatory Flexibility Analysis under 

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

chapter 6) is not required. Any effect on 

small entities by the rules in the 

regulations generally flows directly from 

section 403 of the Act. In addition, it is 

anticipated that the requirements in the 

regulations in this document will fall 

only on financial services firms with 

annual receipts greater than the $38.5 

million threshold and, therefore, on no 

small entities. 

Section 403(a) of the Act requires a 

broker to report the adjusted basis of a 

debt instrument that is a covered 

security. Although a holder of a debt 

instrument (customer) is permitted to 

make a number of elections that affect 

how basis is computed, a broker only is 

required to take into account specified 

elections in reporting a debt 

instrument’s adjusted basis, including 

the election under section 1276(b)(2) to 

determine accruals of market discount 

on a constant yield method. Under the 

2013 final basis reporting regulations, a 

customer had to notify the broker that 

the customer had made the section 

1276(b)(2) election. However, § 1.6045– 

1T(n)(11)(i)(B) requires a broker to take 

into account the election under section 

1276(b)(2) in reporting a debt 

instrument’s adjusted basis unless the 

customer timely notifies the broker that 

the customer has not made the election. 

The notification must be in writing, 

which includes a writing in electronic 

format. In most cases, this election 

results in a more taxpayer-favorable 

result than the default ratable method. 

It is anticipated that this collection of 

information in the regulations will not 

fall on a substantial number of small 

entities, especially because fewer 

customers will need to notify brokers 

about the election. Further, the 

regulations generally implement the 

statutory requirements for reporting 

adjusted basis under section 403 of the 

Act. Moreover, any economic impact is 

expected to be minimal because it 

should take a customer no more than 

seven minutes to satisfy the 

information-sharing requirement in 

these regulations. 

Section 403(c) of the Act added 

section 6045A, which requires 

applicable persons to provide a transfer 

statement in connection with the 

transfer of custody of a covered security. 

Section 1.6045A–1T and the 

corresponding proposed regulations in 

this document effectuate the Act by 

giving the broker who receives the 

transfer statement the information 

necessary to determine and report 

adjusted basis and whether any gain or 

loss with respect to a debt instrument or 

section 1256 option is long-term or 

short-term as required by section 6045 

when the security is subsequently sold. 

Consequently, § 1.6045A–1T and the 

corresponding proposed regulations in 

this document do not add to the impact 

on small entities imposed by the 

statutory provisions. Instead, the 

regulations limit the information to be 

reported to only those items necessary 

to effectuate the statutory scheme. 

The information required under 

§ 1.6049–10T and the corresponding 

proposed regulations in this document 

will enable the IRS to verify that a 

taxpayer is reporting the correct amount 

of tax-exempt interest each year for 

alternative minimum tax and other 

purposes. In addition, because this 

information is used to report a 

taxpayer’s adjusted basis in a debt 

instrument under section 6045(g), this 

information is required to enable the 

IRS to verify that a taxpayer is reporting 

the correct amount of gain or loss upon 

the sale of a tax-exempt obligation. Any 

economic impact on small entities is 

expected to be minimal because a broker 

already is required to determine the 

accruals of OID and acquisition 

premium for purposes of determining 

and reporting a customer’s adjusted 

basis on Form 1099–B under section 

6045. Moreover, any effect on small 

entities by the rules in the final 

regulations flows from section 6049 and 

section 403 of the Act. 

Pursuant to section 7805(f) of the 

Internal Revenue Code, this notice of 

proposed rulemaking has been 

submitted to the Chief Counsel for 

Advocacy of the Small Business 

Administration for comment on its 

impact on small businesses. 

Comments and Request for Public 

Hearing 

Before these proposed regulations are 

adopted as final regulations, 

consideration will be given to any 

written (a signed original and eight (8) 

copies) or electronic comments that are 

submitted timely to the IRS as 

prescribed in the preamble under the 

ADDRESSES heading. The Treasury 

Department and the IRS welcome 

comments on the clarity of the proposed 

rules and how they can be made easier 

to understand. All comments will be 

available at www.regulations.gov for 

public inspection and copying. A public 

hearing may be scheduled if requested 

in writing by any person that timely 

submits written comments. If a public 

hearing is scheduled, notice of the date, 

time, and place for a public hearing will 

be published in the Federal Register. 

Drafting Information 

The principal author of these 

regulations is Pamela Lew, Office of 

Associate Chief Counsel (Financial 

Institutions and Products). However, 

other personnel from the IRS and the 

Treasury Department participated in 

their development. 


tkelley on DSK3SPTVN1PROD with PROPOSALS
Federal Register / Vol. 80, No. 49 / Friday, March 13, 2015 / Proposed Rules 13295 

List of Subjects in 26 CFR Part 1 

Income Taxes, Reporting and 

recordkeeping requirements. 

Proposed Amendments to the 

Regulations 

Accordingly, 26 CFR part 1 is 

proposed to be amended as follows: 

PART 1—INCOME TAXES 

■ Paragraph 1. The authority citation 

for part 1 is amended by adding entries 

in numerical order to read in part as 

follows: 

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

Section 1.6045–1(n)(11) also issued under 

26 U.S.C. 6045(g). * * * 

Section 1.6045A–1(e) and (f) also issued 

under 26 U.S.C. 6045A(a). * * * 

Section 1.6049–10 also issued under 26 

U.S.C. 6049(a). * * * 

■ Par. 2. Section 1.6045–1(n)(11) is 

added to read as follows: 

§ 1.6045–1 Returns of information of 

brokers and barter exchanges. 

[The text of proposed § 1.6045– 

1(n)(11) is the same as the text of 

§ 1.6045–1T(n)(11) published elsewhere 

in this issue of the Federal Register]. 

■ Par. 3. Sections 1.6045A–1(e) and (f) 

are added to read as follows: 

§ 1.6045A–1 Statements of information 

required in connection with transfers of 

securities. 

[The text of proposed § 1.6045A–1(e) 

and (f) is the same as the text of 

§ 1.6045A–1T(e) and (f) published 

elsewhere in this issue of the Federal 

Register]. 

■ Par. 4. Section 1.6049–10 is added to 

read as follows: 

§ 1.6049–10 Reporting of original issue 

discount on a tax-exempt obligation. 

[The text of proposed § 1.6049–10 is the same 

as the text of § 1.6049–10T published 

elsewhere in this issue of the Federal 

Register]. 

John Dalrymple, 

Deputy Commissioner for Services and 

Enforcement. 

[FR Doc. 2015–05654 Filed 3–12–15; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF LABOR 

Occupational Safety and Health 

Administration 

29 CFR Parts 1910, 1915, 1917, 1918, 

and 1926 

[Docket No. OSHA–2014–0024] 

RIN 1218–AC87 

Updating OSHA Standards Based on 

National Consensus Standards; Eye 

and Face Protection 

AGENCY: Occupational Safety and Health 

Administration (OSHA), Department of 

Labor. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Occupational Safety and 

Health Administration (‘‘OSHA’’ or 

‘‘Agency’’) is issuing this notice of 

proposed rulemaking to update its 

general industry, shipyard employment, 

marine terminals, longshoring, and 

construction eye and face protection 

standards by incorporating by reference 

the three most recent versions of the 

American National Standards Institute 

(‘‘ANSI’’ or ‘‘national consensus 

standard’’) Occupational and 

Educational Eye and Face Protection 

standard. In addition, OSHA proposes 

to change language in the construction 

eye and face protection standard to 

make it consistent with both the general 

industry and maritime standards. 

DATES: Submit comments on this notice 

of proposed rule (including comments 

on the information-collection 

(paperwork) determination described 

under the section titled Procedural 

Determinations, hearing requests, and 

other information) by April 13, 2015. 

All submissions must bear a postmark 

or provide other evidence of the 

submission date (the following section 

titled ADDRESSES describes the available 

methods of making submissions). 

ADDRESSES: Submit comments, hearing 

requests, and other information as 

follows: 

• Electronic. Submit comments 

electronically to http://

www.regulations.gov, which is the 

Federal eRulemaking Portal. Follow the 

instructions online for submitting 

comments. 

• Facsimile. OSHA allows facsimile 

transmission of comments and hearing 

requests that are 10 pages or fewer in 

length (including attachments). Send 

these documents to the OSHA Docket 

Office at (202) 693–1648; OSHA does 

not require hard copies of these 

documents. Instead of transmitting 

facsimile copies of attachments that 

supplement these documents (e.g., 

studies, journal articles), commenters 

must submit these attachments to the 

OSHA Docket Office, Technical Data 

Center (TDC), Room N–2625, OSHA, 

U.S. Department of Labor, 200 

Constitution Ave. NW., Washington, DC 

20210. These attachments must clearly 

identify the sender’s name, date, 

subject, and docket number (i.e., 

OSHA–2014–0024 so that the Agency 

can attach them to the appropriate 

document. 

• Regular mail, express delivery, 

hand delivery, and messenger (courier) 

service. Submit comments and any 

additional material (e.g., studies, journal 

articles) to the OSHA Docket Office, 

Docket No. OSHA–2013–0024 or RIN 

1218–AC8708 Technical Data Center, 

Room N–2625, OSHA, U.S. Department 

of Labor, 200 Constitution Ave. NW., 

Washington, DC 20210; telephone: (202) 

693–2350. (OSHA’s TTY number is 

(877) 889–5627)). Note that security 

procedures may result in significant 

delays in receiving comments and other 

written materials by regular mail. 

Contact the OSHA Docket Office for 

information about security procedures 

for delivery of materials by express 

delivery, hand delivery, and messenger 

service. The hours of operation for the 

OSHA Docket Office are 8:15 a.m. to 

4:45 p.m., e.t. 

• Instructions. All submissions must 

include the Agency name and the OSHA 

docket number (i.e., OSHA Docket No. 

OSHA–2014–0024). OSHA will place 

comments and other material, including 

any personal information, in the public 

docket without revision, and these 

materials will be available online at: 

http://www.regulations.gov. Therefore, 

the Agency cautions commenters about 

submitting statements they do not want 

made public, or submitting comments 

that contain personal information 

(either about themselves or others), such 

as social security numbers, birth dates, 

and medical data. 

OSHA invites comments on all issues 

related to this notice of proposed 

rulemaking. The Agency also welcomes 

comments on its findings that this 

notice of proposed rulemaking will have 

no impact on the regulated community. 

• Docket. To read or download 

comments or other material in the 

docket, go to http://

www.regulations.gov. The electronic 

docket for this notice of proposed rule 

established at http://

www.regulations.gov contains most of 

the documents in the docket. Some 

information (e.g., copyrighted material), 

however, cannot be read or downloaded 

through this Web site. All submissions, 

including copyrighted material, are 

accessible at the OSHA Docket Office. 


tkelley on DSK3SPTVN1PROD with PROPOSALS