[Federal Register Volume 61, Number 3 (Thursday, January 4, 1996)]
[Rules and Regulations]
[Pages 260-262]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-114]



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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 1, 301, and 602

[TD 8651]
RIN 1545-AS05


Automatic Extension of Time for Filing Individual Income Tax 
Returns

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Temporary regulations.

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SUMMARY: This document contains temporary regulations that reflect new 
simpler procedures for an individual to obtain an automatic extension 
of time to file an individual income tax return. The text of the 
temporary regulations also serves as the text of the cross reference 
notice of proposed rulemaking on this subject in the Proposed Rules 
section of this issue of the Federal Register.

DATES: These regulations are effective January 4, 1996.
    For dates of applicability, see Sec. 1.6081-4T and Sec. 301.6651-
1T.

FOR FURTHER INFORMATION CONTACT: Margaret A. Owens, (202) 622-6232 (not 
a toll-free number).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    These regulations are being issued without prior notice and public 
procedure pursuant to the Administrative Procedure Act (5 U.S.C. 553). 
For this reason, the collection of information contained in these 
regulations has been reviewed and, pending receipt and evaluation of 
public comments, approved by the Office of Management and Budget under 
control number 1545-1479. Responses to this collection of information 
are required to obtain a benefit (an automatic 4-month extension of 
time to file an individual income tax return).
    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 control number.
    For further information concerning the collection of information, 
and where to submit comments on the collection of information and the 
accuracy of the estimated burden, and suggestions for reducing this 
burden, please refer to the preamble to the cross-referencing notice of 
proposed rulemaking published in the Proposed Rules section of this 
issue of the Federal Register.
    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 26 U.S.C. 6103.

Background

    This document amends the Income Tax Regulations (26 CFR Part 1) 
under section 6081 of the Internal Revenue Code of 1986 to implement 
Notice 93-22 (1993-1 C.B. 305). Notice 93-22, released April 7, 1993, 
grants relief to individuals who want an automatic 4-month extension of 
time to file an individual income tax return but who are unable to pay 
by the due date for the return the tax properly estimated to be due. 
The notice allows these individuals to obtain an automatic 4-month 
extension of time to file their individual 

[[Page 261]]
income tax returns for taxable years ending on or after December 31, 
1992, by filing Form 4868, Application for Automatic Extension of Time 
to File U.S. Individual Income Tax Return, without an accompanying 
remittance. Individuals may rely on Notice 93-22 for taxable years 
ending on or after December 31, 1992 and before December 31, 1995. 
Notice 93-22 also advised taxpayers that the regulations under section 
6081 will be amended to reflect this change in the procedure for an 
individual to obtain an automatic 4-month extension of time to file. In 
addition, this document amends the Regulations on Procedure and 
Administration (26 CFR Part 301) (relating to an automatic extension of 
time for filing an individual income tax return).

Explanation of Provisions

    Under Sec. 1.6081-4, an individual required to file an income tax 
return is allowed an automatic 4-month extension of time to file if (a) 
an application is prepared on Form 4868, (b) the application is signed 
by the individual or a person duly authorized by the individual, (c) 
the application is filed on or before the date the return is due, (d) 
the application shows the full amount properly estimated as tax, and 
(e) the application is accompanied by full remittance of the amount 
properly estimated as tax that is unpaid as of the date prescribed for 
the filing of the return.
    These temporary regulations provide that individuals may obtain an 
automatic 4-month extension of time to file an individual income tax 
return without remitting the unpaid amount of any tax properly 
estimated to be due with the application for extension of time to file. 
Under these temporary regulations, an individual's inability to pay is 
not a condition for obtaining an automatic 4-month extension. However, 
taxpayers are encouraged to make payments, as large as possible, in 
order to reduce interest and penalties required by law.
    In addition, these temporary regulations provide that the IRS may 
prescribe other manners for submitting an application in lieu of a 
paper application on Form 4868.
    The temporary regulations remove the regulatory requirement that 
applications for an automatic 4-month extension be signed. Thus, 
notwithstanding the 1995 Form 4868 instructions, an unsigned 
application will be processed. In addition, the Commissioner may 
prescribe additional methods of obtaining an extension of time to file 
that do not require a signature.

Special Analyses

    It has been determined that these temporary regulations are not a 
significant regulatory action as defined in EO 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) 
and the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply to 
these regulations and, therefore, a Regulatory Flexibility Analysis is 
not required. Pursuant to section 7805(f) of the Internal Revenue Code, 
a copy of these regulations will be submitted to the Chief Counsel for 
Advocacy of the Small Business Administration for comment on their 
impact on small business.

    Drafting Information. The principal author of these regulations 
is Margaret A. Owens, Office of the Assistant Chief Counsel (Income 
Tax & Accounting), IRS. However, other personnel from the IRS and 
the Treasury Department participated in their development.

List of Subjects

26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

26 CFR Part 301

    Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income 
taxes, Penalties, Reporting and recordkeeping requirements.

26 CFR Part 602

    Reporting and recordkeeping requirements.

Amendments to the Regulations

    Accordingly, 26 CFR parts 1, 301, and 602 are amended as follows:

PART 1--INCOME TAXES

    Paragraph 1. The authority citation for part 1 continues to read in 
part as follows:

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

    Par. 2. Section 1.6081-4 is amended by revising paragraph (a) to 
read as follows:


Sec. 1.6081-4  Automatic extension of time for filing individual income 
tax returns.

    (a) [Reserved] For further guidance see Sec. 1.6081-4T(a).
* * * * *
    Par. 3. Section 1.6081-4T is added to read as follows:


Sec. 1.6081-4T  Automatic extension of time for filing individual 
income tax returns--taxable years ending on or after December 31, 1995 
(temporary).

    (a) In general--(1) Period of extension. An individual who is 
required to file an individual income tax return for any taxable year 
ending on or after December 31, 1995, will be allowed an automatic 4-
month extension of time to file the return after the date prescribed 
for filing the return provided the requirements contained in paragraphs 
(a)(2), (3), and (4) of this section are met. In the case of an 
individual described in Sec. 1.6081-5(a)(5) or (6), the automatic 4-
month extension will run concurrently with the extension of time to 
file granted pursuant to Sec. 1.6081-5.
    (2) Manner for submitting an application. An application must be 
submitted--
    (i) On Form 4868, Application for Automatic Extension of Time to 
File U.S. Individual Income Tax Return; or
    (ii) In any other manner as may be prescribed by the Commissioner.
    (3) Time and place for filing application. Except in the case of an 
individual described in Sec. 1.6081-5(a)(5) or (6), the application 
must be filed on or before the date prescribed for filing the 
individual income tax return. In the case of an individual described in 
Sec. 1.6081-5(a)(5) or (6), the application must be filed on or before 
the expiration of the extension of time to file granted pursuant to 
Sec. 1.6081-5. The application must be filed with the IRS office 
designated in the application's instructions.
    (4) Proper estimate of tax. An application for extension must show 
the full amount properly estimated as tax for the taxable year.
    (5) Allowance of extension. Upon properly preparing and timely 
filing an application, the 4-month extension will be considered as 
allowed. Except in undue hardship cases, no extension of time for 
filing an individual income tax return will be granted under 
Sec. 1.6081-1 until an automatic extension has been allowed pursuant to 
the provisions of this paragraph (a).
    (b) and (c) [Reserved].
    (d) Penalties. See section 6651 and the regulations under that 
section for the additions to tax for failure to file an individual 
income tax return or failure to pay the amount shown as tax on the 
return. In particular, see Sec. 301.6651-1(c)(3) of this chapter 
(relating to a presumption of reasonable cause in certain circumstances 
involving an automatic extension of time for filing an individual 
income tax return). 

[[Page 262]]


PART 301--PROCEDURE AND ADMINISTRATION

    Par. 4. The authority citation for part 301 continues to read in 
part as follows:

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

    Par. 5. Section 301.6651-1 is amended by revising paragraph (c)(3) 
to read as follows:


Sec. 301.6651-1  Failure to file tax return or to pay tax.

* * * * *
    (c)(3) [Reserved] For further guidance see Sec. 301.6651-1T(c)(3).
* * * * *
    Par. 6. Section 301.6651-1T is added to read as follows:


Sec. 301.6651-1T  Failure to file tax return or to pay tax--taxable 
years ending on or after December 31, 1995 (temporary).

    (a) through (c)(2) [Reserved].
    (c)(3) If, for a taxable year ending on or after December 31, 1995, 
an individual taxpayer satisfies the requirements of Sec. 1.6081-4T(a) 
of this chapter (relating to an automatic extension of time for filing 
an individual income tax return), reasonable cause shall be presumed, 
for the period of the extension of time to file, with respect to any 
underpayment of tax if--
    (i) The excess of the amount of tax shown on the individual income 
tax return over the amount of tax paid on or before the regular due 
date of the return (by virtue of taxes withheld by the employer, 
estimated tax payments, and any payment with an application for 
extension of time to file pursuant to Sec. 1.6081-4T of this chapter) 
is no greater than 10 percent of the amount of tax shown on the 
individual income tax return; and
    (ii) Any balance due shown on the individual income tax return is 
remitted with the return.

PART 602--OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT

    Par. 7. The authority citation for part 602 continues to read as 
follows:

    Authority: 26 U.S.C. 7805.


Sec. 602.101  [Amended]

    Par. 8. In Sec. 602.101, paragraph (c) is amended by adding an 
entry in numerical order to the table to read ``1.6081-4T. . . .1545-
1479''.

Margaret Milner Richardson,
Commissioner of Internal Revenue.
    Approved: December 20, 1995.
Leslie Samuels,
Assistant Secretary of the Treasury.
[FR Doc. 96-114 Filed 1-3-96; 8:45 am]
BILLING CODE 4830-01-U