[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Rules and Regulations]
[Pages 27007-27008]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13398]



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DEPARTMENT OF THE TREASURY
26 CFR Parts 31 and 602

[TD 8672]
RIN 1545-AT86


Reporting of Nonpayroll Withheld Tax Liabilities

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations.

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SUMMARY: This document contains final regulations relating to the 
reporting of nonpayroll withheld income taxes under section 6011 of the 
Internal Revenue Code. The final regulations require a person to file 
Form 945, Annual Return of Withheld Federal Income Tax, only for a 
calendar year in which the person is required to withhold Federal 
income tax from nonpayroll payments.

EFFECTIVE DATE: These regulations are effective May 30, 1996.

FOR FURTHER INFORMATION CONTACT: Vincent G. Surabian, 202-622-6232 (not 
a toll-free number).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    The collection of information contained in these final regulations 
has been reviewed and approved by the Office of Management and Budget 
in accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under 
control number 1545-1413. Responses to this collection of information 
are required by the IRS to monitor compliance with the Federal tax 
rules related to the reporting and deposit of nonpayroll withheld 
income taxes.
    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.
    Estimates of the reporting burden in these final regulations are 
reflected in the burden of Form 945.
    Comments concerning the accuracy of this burden estimate and 
suggestions for reducing this burden should be sent to the Internal 
Revenue Service, Attn: IRS Reports Clearance Officer, T:FP, Washington, 
DC 20224, and to the Office of Management and Budget, Attn: Desk 
Officer for the Department of the Treasury, Office of Information and 
Regulatory Affairs, Washington, DC 20503.
    Books or records relating to this 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

    On October 16, 1995, final and temporary regulations (TD 8624) 
relating to the reporting of nonpayroll withheld income taxes under 
section 6011 were published in the Federal Register (60 FR 53509). A 
notice of proposed rulemaking (IA-30-95) cross-referencing the 
temporary regulations was published in the Federal Register for the 
same day (60 FR 53561).
    The IRS received no written comments responding to the notice. 
Accordingly, the regulations proposed by IA-30-95 are adopted as 
proposed with a minor editorial change.

Explanation of Provisions

    These final regulations remove the requirement that, once a person 
files a Form 945 for a calendar year, the person must file a Form 945 
every subsequent year until the person files a final return. Under 
these final regulations, a person must file a Form 945 only for a 
calendar year in which the person is required to withhold Federal 
income tax from nonpayroll payments.

Special Analyses

    It has been determined that this Treasury decision is not a 
significant regulatory action as defined in EO 12866. 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) 
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

[[Page 27008]]

Code, the notice of proposed rulemaking preceding these regulations was 
submitted to the Small Business Administration for comment on its 
impact on small business.

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

List of Subjects

26 CFR Part 31

    Employment taxes, Income taxes, Penalties, Pensions, Railroad 
retirement, Reporting and recordkeeping requirements, Social security, 
Unemployment compensation.

26 CFR Part 602

    Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

    Accordingly, 26 CFR parts 31 and 602 are amended as follows:

PART 31--EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT SOURCE

    Paragraph 1. The authority citation for part 31 is amended by 
removing the citation for ``Section 31.6011(a)-4T'' as follows:

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

    Par 2. Section 31.6011(a)-4 is amended by revising paragraph (b) to 
read as follows:


Sec. 31.6011(a)-4  Returns of income tax withheld.

* * * * *
    (b) Withheld from nonpayroll payments. Every person required to 
withhold tax from nonpayroll payments for calendar year 1994 must make 
a return for calendar year 1994 and for any subsequent calendar year in 
which the person is required to withhold such tax until the person 
makes a final return in accordance with Sec. 31.6011(a)-6. Every person 
not required to withhold tax from nonpayroll payments for calendar year 
1994 must make a return for the first calendar year after 1994 in which 
the person is required to withhold such tax and for any subsequent 
calendar year in which the person is required to withhold such tax 
until the person makes a final return in accordance with 
Sec. 31.6011(a)-6. Form 945, Annual Return of Withheld Federal Income 
Tax, is the form prescribed for making the return required under this 
paragraph (b). Nonpayroll payments are--
    (1) Certain gambling winnings subject to withholding under section 
3402(q);
    (2) Retirement pay for services in the Armed Forces of the United 
States subject to withholding under section 3402;
    (3) Certain annuities as described in section 3402(o)(1)(B);
    (4) Pensions, annuities, IRAs, and certain other deferred income 
subject to withholding under section 3405; and
    (5) Reportable payments subject to backup withholding under section 
3406.
* * * * *


Sec. 31.6011(a)-4T  [Removed]

    Par. 3. Section 31.6011(a)-4T is removed.

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

    Par. 4. The authority citation for part 602 continues to read as 
follows:

    Authority: 26 U.S.C. 7805.


Sec. 602.101  [Amended]

    Par. 5. Section 602.101, paragraph (c) is amended in the table by 
removing the entry ``31.6011(a)-4T....1545-1413''.
Margaret Milner Richardson,
Commissioner of Internal Revenue.
    Approved: April 5, 1996.
Leslie Samuels,
Assistant Secretary of the Treasury.
[FR Doc. 96-13398 Filed 5-29-96; 8:45 am]
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