Net Investment Income Tax; Correction, 18159-18161 [2014-07160]
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Federal Register / Vol. 79, No. 62 / Tuesday, April 1, 2014 / Rules and Regulations
(d) * * *
(3) Limitations. Animals intended for
human consumption must not be
slaughtered within 38 days of treatment.
This drug product is not approved for
use in female dairy cattle 20 months of
age or older, including dry dairy cows.
Use in these cattle may cause drug
residues in milk and/or in calves born
to these cows. A withdrawal period has
not been established in preruminating
calves. Do not use in calves to be
processed for veal. Federal law restricts
this drug to use by or on the order of
a licensed veterinarian.
■ 12. Add § 522.2473 to read as follows:
§ 522.2473
Tiludronate.
(a) Specifications. Each vial of powder
contains 500 milligrams (mg)
tiludronate disodium. Each milliliter of
constituted solution contains 20 mg
tiludronate disodium.
(b) Sponsor. See No. 013744 in
§ 510.600(c) of this chapter.
(c) Conditions of use in horses—(1)
Amount. Administer a single dose of 1
mg per kilogram (0.45 mg/pound) of
body weight by intravenous infusion.
(2) Indication for use. For the control
of clinical signs associated with
navicular syndrome.
(3) Limitations. Do not use in horses
intended for human consumption.
Federal law restricts this drug to use by
or on the order of a licensed
veterinarian.
PART 526—INTRAMAMMARY DOSAGE
FORM NEW ANIMAL DRUGS
Authority: 21 U.S.C. 360b.
14. In § 526.313, remove paragraph
(d); redesignate paragraph (e) as
paragraph (d); and revise newly
redesignated paragraphs (d)(1)(iii) and
(d)(2)(iii) to read as follows:
Ceftiofur.
wreier-aviles on DSK5TPTVN1PROD with RULES
*
*
*
*
(d) * * *
(1) * * *
(iii) Limitations. Milk taken from
cows during treatment (a maximum of
eight daily infusions) and for 72 hours
after the last treatment must not be used
for human consumption. Following
label use for up to 8 consecutive days,
a 2-day preslaughter withdrawal period
is required. Federal law restricts this
drug to use by or on the order of a
licensed veterinarian. Federal law
prohibits extra-label use of this drug in
lactating dairy cattle for disease
prevention purposes; at unapproved
doses; frequencies, durations, or routes
VerDate Mar<15>2010
14:19 Mar 31, 2014
Jkt 232001
15. The authority citation for 21 CFR
part 558 continues to read as follows:
■
Authority: 21 U.S.C. 360b, 371.
§ 558.261
[Amended]
16. In § 558.261, in paragraph
(e)(2)(ii), in the ‘‘Limitations’’ column,
remove ‘‘10 mg florfenicol’’ and in its
place add ‘‘10 to 15 mg florfenicol’’; and
in paragraph (e)(2)(iii), in the
‘‘Limitations’’ column, remove ‘‘10 mg
florfenicol per kg of fish for’’.
■
ACTION:
Correcting amendment.
This document contains
corrections to final regulations (TD
9644) that were published in the
Federal Register on Monday, December
2, 2013 (78 FR 72394). The final
regulations provide guidance on the
general application of the Net
Investment Income Tax and the
computation of Net Investment Income.
DATES: This correction is effective April
1, 2014 and applicable December 2,
2013.
FOR FURTHER INFORMATION CONTACT:
Adrienne M. Mikolashek, at (202) 317–
6852 (not a toll free number).
SUPPLEMENTARY INFORMATION:
SUMMARY:
Background
The final regulations (TD 9644) that
are the subject of this correction is
under section 1411 of the Internal
Revenue Code.
Need for Correction
As published, the final regulations
(TD 9644) contain errors that may prove
to be misleading and are in need of
clarification.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and
recordkeeping requirements.
Correction of Publication
Accordingly, 26 CFR part 1 is
corrected by making the following
correcting amendments:
PART 1—INCOME TAXES
[Amended]
17. In § 558.550, in paragraph
(d)(1)(i)(c), remove ‘‘layers’’ and in its
place add ‘‘laying hens producing eggs
for human consumption’’; and add at
the end of paragraph (d)(2)(i)(c), ‘‘Do not
feed to laying hens producing eggs for
human consumption.’’
■
■
*
PART 558—NEW ANIMAL DRUGS FOR
USE IN ANIMAL FEEDS
§ 558.550
13. The authority citation for 21 CFR
part 526 continues to read as follows:
■
§ 526.313
of administration; and in unapproved
major food producing species/
production classes.
(2) * * *
(iii) Limitations. Milk taken from
cows completing a 30-day dry-off period
may be used for food with no milk
discard due to ceftiofur residues.
Following intramammary infusion, a 16day preslaughter withdrawal period is
required for treated cows. Following
label use, no preslaughter withdrawal
period is required for neonatal calves
from treated cows regardless of
colostrum consumption. Federal law
restricts this drug to use by or on the
order of a licensed veterinarian. Federal
law prohibits extra-label use of this drug
in dry dairy cattle for disease prevention
purposes; at unapproved doses;
frequencies, durations, or routes of
administration; and in unapproved
major food producing species/
production classes.
Dated: March 27, 2014.
Bernadette Dunham,
Director, Center for Veterinary Medicine.
Paragraph 1. The authority citation
for part 1 continues to read in part as
follows:
■
Authority: 26 U.S.C. 7805 ***
Par. 2. Section 1.469–11 is amended
by revising the first sentence of
paragraph (b)(3)(iv)(C)(1) and the last
sentence of paragraph (b)(3)(iv)(C)(3)
Example 4. to read as follows:
■
[FR Doc. 2014–07220 Filed 3–31–14; 8:45 am]
§ 1.469–11
rules.
BILLING CODE 4160–01–P
*
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9644]
RIN 1545–BK44
Net Investment Income Tax; Correction
Internal Revenue Service (IRS),
Treasury.
AGENCY:
PO 00000
18159
Frm 00007
Fmt 4700
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Effective date and transition
*
*
*
*
(b) * * *
(3) * * *
(iv) * * *
(C) * * * (1) * * * An individual,
estate, or trust also may regroup
activities, in the manner described in
paragraph (b)(3)(iv)(A) of this section,
on an amended return only if the
changes reported on such amended
return cause the taxpayer to meet the
Eligibility Criteria for the first time
beginning in the taxable year for which
the amended return is applicable and
that the taxable year is not closed by the
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01APR1
18160
Federal Register / Vol. 79, No. 62 / Tuesday, April 1, 2014 / Rules and Regulations
period of limitations on assessments
under section 6501. * * *
*
*
*
*
*
(3) * * *
Example 4. * * * Third, Y may file an
original or an amended return to regroup in
a manner different from groupings in effect
prior to Year 1 and different from the Year
1 groupings (for example, Y could choose to
group Activity C and D into a single activity,
thus causing Y to have two groups; Group A–
B and Group C–D).
*
*
*
*
*
Par. 3. Section 1.1411–0 is amended
by revising the entries in the table of
contents for § 1.1411–3(c)(2)(ii) and (iii)
to read as follows:
■
§ 1.1411–0 Table of contents of provisions
applicable to section 1411.
*
*
*
§ 1.1411–3
Trusts.
*
*
Application to Estates and
*
*
*
*
*
(c) * * *
(2) * * *
(ii) Step two.
(iii) Step three.
*
*
*
*
*
■ Par. 4. Section 1.1411–2 is amended
by revising the first sentence of
paragraph (b)(2) to read as follows:
§ 1.1411–2
*
§ 1.1411–4
income.
*
Application to individuals.
*
*
(b) * * *
(2)
*
*
Example. During Year 1 (a year in which
section 1411 is in effect), A, an unmarried
United States citizen, has modified adjusted
gross income (as defined in paragraph (c) of
this section) of $190,000, which includes
$50,000 of net investment income. * * *
*
*
*
*
*
Par. 5. Section 1.1411–3 is amended
by revising the second sentence of
paragraph (c)(3)(ii)(A) and the first
sentence of paragraph (c)(3)(iii)(B) to
read as follows:
■
§ 1.1411–3
trusts.
Application to estates and
wreier-aviles on DSK5TPTVN1PROD with RULES
*
*
*
*
*
(c) * * *
(3) * * *
(ii) * * * (A) * * * The undistributed
net investment income for the S portion
is $27,600 and is determined as follows:
*
*
*
*
*
(iii) * * *
(B) The adjusted gross income for the
ESBT is $40,000 and is determined as
follows: * * *
*
*
*
*
*
■ Par. 6. Section 1.1411–4 is amended
as follows:
■ 1. The first sentence of paragraph
(d)(4)(i)(C) Example 2. (i) is revised.
VerDate Mar<15>2010
2. The language ‘‘deduction’’ in the
last sentence of paragraph (f)(2)(v)
Example 1. (iv) is removed and
‘‘deductions’’ is added in its place.
■ 3. The language ‘‘A’’ in the third
sentence of paragraph (f)(2)(v) Example
2. (iii) is removed and ‘‘A’s’’ is added in
its place.
■ 4. Paragraph (f)(3)(iii) is revised.
■ 5. The language ‘‘§ 1.171–
2T(a)(4)(i)(C)’’ in paragraph (f)(3)(vii) is
removed and ‘‘§ 1.171–2(a)(4)(i)(C)’’ is
added in its place.
■ 6. The second sentence of paragraph
(f)(4)(ii) Example 1. (iii) is revised.
■ 7. The language ‘‘one or more’’ in
paragraph (g)(7)(i) introductory text is
removed and ‘‘a’’ is added in its place.
■ 8. The language ‘‘activities’’ in
paragraph (g)(7)(i) introductory text is
removed and ‘‘activity’’ is added in its
place.
■ 9. Paragraph (h)(2) introductory text is
revised.
■ 10. The language ‘‘.2’’ in paragraph
(h)(5) Example 1. (ii) is removed and
added in its place ‘‘0.2’’.
The revisions read as follows:
■
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Jkt 232001
Definition of net investment
*
*
(d) * * *
(4) * * *
(i) * * *
(C) * * *
*
*
Example 2. * * * (i) PRS, a partnership for
Federal income tax purposes, operates an
automobile dealership. * * *
*
*
*
*
*
(f) * * *
(3) * * *
(iii) Taxes described in section
164(a)(3). State, local, and foreign
income, war profits, and excess profit
taxes described in section 164(a)(3) that
are allocable to net investment income
pursuant to paragraph (g)(1) of this
section. Except to the extent specifically
expected from section 275(a)(4), foreign
income, war profits, and excess profit
taxes are not allowed as deductions
under section 164(a)(3) in determining
net investment income if the taxpayer
claims the benefit of the foreign tax
credit under section 901 with respect to
the same taxable year. For rules
applicable to refunds of taxes described
in this paragraph, see paragraph (g)(2) of
this section.
*
*
*
*
*
(4) * * *
(ii) * * *
Example 1. * * *
(iii) * * * Pursuant to paragraph (d) of this
section, A takes into account the $60,000 at
ordinary loss from PRS and the $50,000 of
long term capital gain in the computation of
A’s net gain. * * *
*
PO 00000
*
*
Frm 00008
*
Fmt 4700
*
Sfmt 4700
(h) * * *
(2) Applicable portion of a net
operating loss. In any taxable year
beginning after December 31, 2012, in
which a taxpayer incurs a net operating
loss, the applicable portion of such loss
is the lesser of:
*
*
*
*
*
■ Par. 7. Section 1.1411–5 is amended
by revising paragraph (b)(2)(i) and
(b)(2)(iii) to read as follows:
§ 1.1411–5 Trades or businesses to which
tax applies.
*
*
*
*
*
(b) * * *
(2) * * * (i) Income and gain
recharacterization. To the extent that
any income or gain from a trade or
business is recharaterized as ‘‘not from
a passive activity’’ by reason of § 1.469–
2T(f)(2), § 1.469–2(f)(5), or § 1.469–
2(f)(6), such trade or business does not
constitute a passive activity within the
meaning of paragraph (b)(1)(ii) of this
section solely with respect to such
recharaterized income or gain.
*
*
*
*
*
(iii) Exception for certain portfolio
recharacterizations. To the extent that
any income or gain from a trade or
business is recharacterized as ‘‘not from
a passive activity’’ and is further
characterized as portfolio income under
§ 1.469–2(f)(10) or § 1.469–2(c)(2)(iii)(F),
then such trade or business constitutes
a passive activity within the meaning of
paragraph (b)(1)(ii) of this section solely
with respect to such recharacterized
income or gain.
*
*
*
*
*
■ Par. 8. Section 1.1411–10 is amended
as follows:
■ 1. Revise paragraph (c)(5)(i)(B).
■ 2. In paragraph (h) Example 2. (ii)(A),
revise the first sentence.
The revisions read as follows:
§ 1.1411–10 Controlled foreign
corporations and passive foreign
investment companies.
*
*
*
*
*
(c) * * *
(5) * * *
(i) * * *
(B) Decreasing the amount of
investment income determined for
chapter 1 purposes under section
163(d)(4)(B) by the amount included in
gross income for chapter 1 purposes
under section 951(a) or section 1293(a)
that is attributable to a CFC or QEF with
respect to which an election under
paragraph (g) of this section is not in
effect; and
*
*
*
*
*
(h) * * *
Example 2. * * *
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01APR1
Federal Register / Vol. 79, No. 62 / Tuesday, April 1, 2014 / Rules and Regulations
(ii) * * * (A) In 2016, A does not include
the $15,000 section 951(a)(1)(A) income
inclusion in A’s net investment income
under section 1411(c)(1)(A)(i) and § 1.1411–
1(a)(1)(i). * * *
*
*
*
*
*
Martin V. Franks,
Chief, Publications and Regulations Branch,
Legal Processing Division, Associate Chief
Counsel, (Procedure and Administration).
[FR Doc. 2014–07160 Filed 3–31–14; 8:45 am]
BILLING CODE 4830–01–P
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Parts 1 and 602
[TD 9644]
RIN 1545–BK44
Net Investment Income Tax; Correction
Internal Revenue Service (IRS),
Treasury.
ACTION: Final regulations; correction
AGENCY:
This document contains
corrections to final regulations (TD
9644) that were published in the
Federal Register on Monday, December
2, 2013 (78 FR 72394). The final
regulations provide guidance on the
general application of the Net
Investment Income Tax and the
computation of Net Investment Income.
DATES: This correction is effective April
1, 2014 and applicable December 2,
2013.
FOR FURTHER INFORMATION CONTACT:
Adrienne M. Mikolashek, at (202) 317–
6852 (not a toll free number).
SUPPLEMENTARY INFORMATION:
SUMMARY:
Background
The final regulations (TD 9644) that
are the subject of this correction is
under section 1411 of the Internal
Revenue Code.
wreier-aviles on DSK5TPTVN1PROD with RULES
Need for Correction
As published, the final regulations
(TD 9644) contain errors that may prove
to be misleading and are in need of
clarification.
Correction of Publication
Accordingly, the final regulations (TD
9644), that are the subject of FR Doc.
2013–28410, are corrected as follows:
1. On page 72399, first column, in the
preamble, ninth line of the first full
paragraph, the language ‘‘provides that
the section 1411 is applied’’ is corrected
to read ‘‘provides that section 1411 is
applied’’.
2. On page 72405, second column, in
the preamble, twelfth line from the top
VerDate Mar<15>2010
14:19 Mar 31, 2014
Jkt 232001
of the page, the language
‘‘1411(c)(1)(A)(i). See part 5.b.ii.a of
this’’ is corrected to read
‘‘1411(c)(1)(A)(i). See part 5.b.ii.a. of
this’’.
3. On page 72405, second column, in
the preamble, fifteenth line from the top
of the page, the language ‘‘purpose of
section 1411’’ is corrected to read
‘‘purposes of section 1411’’.
4. On page 72406, first column, in the
preamble, sixteenth line from the top of
the page, the language
‘‘1411(c)(1)(a)(iii)’’ is corrected to read
‘‘1411(c)(1)(A)(iii)’’.
5. On page 72406, third column, in
the preamble, fourth line from the
bottom of the page, the language
‘‘Described in Section 1411(C)(1)(b)’’ is
corrected to read ‘‘Described in Section
1411(c)(1)(B)’’.
6. On page 72407, first column, in the
preamble, fifteenth line from the bottom
of the page, the language ‘‘trades or
business, rents, and royalties,’’ is
corrected to read ‘‘trades or businesses,
rents, and royalties,’’.
7. On page 72409, first column, in the
preamble, twelfth line of the first full
paragraph, the language ‘‘reasonable
methods may lead to’’ is corrected to
read ‘‘reasonable methods may lead’’.
8. On page 72411, second column, in
the preamble, twentieth line of the first
full paragraph, the language
‘‘considered passive activity. However,’’
is corrected to read ‘‘considered a
passive activity. However,’’.
9. On page 72412, second column, in
the preamble, seventh and the eighth
lines of the first full paragraph, the
language ‘‘participates in rental real
estate activities for more than 500 hours
per’’ is corrected to read ‘‘participates in
a rental real estate activity for more than
500 hours per’’.
10. On page 72412, second column, in
the preamble, thirteenth and fourteenth
lines of the second full paragraph, the
language ‘‘taxpayer has participated in
rental real estate activities for more than
500 hours’’ is corrected to read
‘‘taxpayer has participated in a rental
real estate activity for more than 500
hours’’.
11. On page 72415, first column, in
the preamble, ninth line from the top of
the page, the language ‘‘469(e)(1)(A)) by
§ 1.469–2T(f)(10). In the’’ is corrected to
read ‘‘469(e)(1)(A)) by § 1.469–2(f)(10).
In the’’.
12. On page 72415, first column, in
the preamble, eighteenth line from the
bottom of the page, the language
‘‘covered by § 1.469–2T(f)(10) and’’ is
corrected to read ‘‘covered by § 1.469–
2(f)(10) and’’.
13. On page 72420, second column, in
the preamble, third line of the first full
PO 00000
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18161
paragraph, the language ‘‘election under
§ 1.1411–10(g) election’’ is corrected to
read ‘‘election under § 1.1411–10(g)’’.
Martin V. Franks,
Chief, Publications and Regulations Branch,
Legal Processing Division, Associate Chief
Counsel, (Procedure and Administration).
[FR Doc. 2014–07162 Filed 3–31–14; 8:45 am]
BILLING CODE 4830–01–P
DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Part 156
[DOD–2008–OS–0160]
RIN 0790–AI42
Department of Defense Personnel
Security Program (PSP)
Department of Defense.
Final rule.
AGENCY:
ACTION:
This rule updates policies and
responsibilities for the Department of
Defense (DoD) Personnel Security
Program (PSP) in accordance with the
provisions of current U.S. Code, Public
Laws, and Executive Orders (E.O.). This
rule establishes policy and assigns
responsibilities related to the operation
of the DoD PSP, including investigative
and adjudicative policy for determining
eligibility to hold a national security
position. This rule also establishes
investigative and adjudicative policy for
the Department’s personal identity
verification (PIV) credential.
DATES: Effective Date: This rule is
effective May 1, 2014.
FOR FURTHER INFORMATION CONTACT: Dr.
Kelly Buck, (703) 604–1130.
SUPPLEMENTARY INFORMATION:
SUMMARY:
Executive Summary
I. Purpose and Legal Authority for This
Rule
This rule updates policies, assigns
responsibilities, and prescribes
procedures for the Department of
Defense (DoD) Personnel Security
Program (PSP) in accordance with the
provisions of current U.S. Code, Public
Laws, and Executive Orders (E.O.). This
rule establishes PSP policy related to
the operation of the DoD PSP, including
investigative and adjudicative policy for
determining eligibility to hold national
security positions. This rule also
establishes Homeland Security
Presidential Directive (HSPD)–12
investigative and adjudicative policy for
the Department’s personal identity
verification (PIV) credential. Legal
authorities for this rule are E.O. 12968,
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]]>Agencies
[Federal Register Volume 79, Number 62 (Tuesday, April 1, 2014)]
[Rules and Regulations]
[Pages 18159-18161]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-07160]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9644]
RIN 1545-BK44
Net Investment Income Tax; Correction
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Correcting amendment.
-----------------------------------------------------------------------
SUMMARY: This document contains corrections to final regulations (TD
9644) that were published in the Federal Register on Monday, December
2, 2013 (78 FR 72394). The final regulations provide guidance on the
general application of the Net Investment Income Tax and the
computation of Net Investment Income.
DATES: This correction is effective April 1, 2014 and applicable
December 2, 2013.
FOR FURTHER INFORMATION CONTACT: Adrienne M. Mikolashek, at (202) 317-
6852 (not a toll free number).
SUPPLEMENTARY INFORMATION:
Background
The final regulations (TD 9644) that are the subject of this
correction is under section 1411 of the Internal Revenue Code.
Need for Correction
As published, the final regulations (TD 9644) contain errors that
may prove to be misleading and are in need of clarification.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Correction of Publication
Accordingly, 26 CFR part 1 is corrected by making the following
correcting amendments:
PART 1--INCOME TAXES
0
Paragraph 1. The authority citation for part 1 continues to read in
part as follows:
Authority: 26 U.S.C. 7805 ***
0
Par. 2. Section 1.469-11 is amended by revising the first sentence of
paragraph (b)(3)(iv)(C)(1) and the last sentence of paragraph
(b)(3)(iv)(C)(3) Example 4. to read as follows:
Sec. 1.469-11 Effective date and transition rules.
* * * * *
(b) * * *
(3) * * *
(iv) * * *
(C) * * * (1) * * * An individual, estate, or trust also may
regroup activities, in the manner described in paragraph (b)(3)(iv)(A)
of this section, on an amended return only if the changes reported on
such amended return cause the taxpayer to meet the Eligibility Criteria
for the first time beginning in the taxable year for which the amended
return is applicable and that the taxable year is not closed by the
[[Page 18160]]
period of limitations on assessments under section 6501. * * *
* * * * *
(3) * * *
Example 4. * * * Third, Y may file an original or an amended
return to regroup in a manner different from groupings in effect
prior to Year 1 and different from the Year 1 groupings (for
example, Y could choose to group Activity C and D into a single
activity, thus causing Y to have two groups; Group A-B and Group C-
D).
* * * * *
0
Par. 3. Section 1.1411-0 is amended by revising the entries in the
table of contents for Sec. 1.1411-3(c)(2)(ii) and (iii) to read as
follows:
Sec. 1.1411-0 Table of contents of provisions applicable to section
1411.
* * * * *
Sec. 1.1411-3 Application to Estates and Trusts.
* * * * *
(c) * * *
(2) * * *
(ii) Step two.
(iii) Step three.
* * * * *
0
Par. 4. Section 1.1411-2 is amended by revising the first sentence of
paragraph (b)(2) to read as follows:
Sec. 1.1411-2 Application to individuals.
* * * * *
(b) * * *
(2)
Example. During Year 1 (a year in which section 1411 is in
effect), A, an unmarried United States citizen, has modified
adjusted gross income (as defined in paragraph (c) of this section)
of $190,000, which includes $50,000 of net investment income. * * *
* * * * *
0
Par. 5. Section 1.1411-3 is amended by revising the second sentence of
paragraph (c)(3)(ii)(A) and the first sentence of paragraph
(c)(3)(iii)(B) to read as follows:
Sec. 1.1411-3 Application to estates and trusts.
* * * * *
(c) * * *
(3) * * *
(ii) * * * (A) * * * The undistributed net investment income for
the S portion is $27,600 and is determined as follows:
* * * * *
(iii) * * *
(B) The adjusted gross income for the ESBT is $40,000 and is
determined as follows: * * *
* * * * *
0
Par. 6. Section 1.1411-4 is amended as follows:
0
1. The first sentence of paragraph (d)(4)(i)(C) Example 2. (i) is
revised.
0
2. The language ``deduction'' in the last sentence of paragraph
(f)(2)(v) Example 1. (iv) is removed and ``deductions'' is added in its
place.
0
3. The language ``A'' in the third sentence of paragraph (f)(2)(v)
Example 2. (iii) is removed and ``A's'' is added in its place.
0
4. Paragraph (f)(3)(iii) is revised.
0
5. The language ``Sec. 1.171-2T(a)(4)(i)(C)'' in paragraph (f)(3)(vii)
is removed and ``Sec. 1.171-2(a)(4)(i)(C)'' is added in its place.
0
6. The second sentence of paragraph (f)(4)(ii) Example 1. (iii) is
revised.
0
7. The language ``one or more'' in paragraph (g)(7)(i) introductory
text is removed and ``a'' is added in its place.
0
8. The language ``activities'' in paragraph (g)(7)(i) introductory text
is removed and ``activity'' is added in its place.
0
9. Paragraph (h)(2) introductory text is revised.
0
10. The language ``.2'' in paragraph (h)(5) Example 1. (ii) is removed
and added in its place ``0.2''.
The revisions read as follows:
Sec. 1.1411-4 Definition of net investment income.
* * * * *
(d) * * *
(4) * * *
(i) * * *
(C) * * *
Example 2. * * * (i) PRS, a partnership for Federal income tax
purposes, operates an automobile dealership. * * *
* * * * *
(f) * * *
(3) * * *
(iii) Taxes described in section 164(a)(3). State, local, and
foreign income, war profits, and excess profit taxes described in
section 164(a)(3) that are allocable to net investment income pursuant
to paragraph (g)(1) of this section. Except to the extent specifically
expected from section 275(a)(4), foreign income, war profits, and
excess profit taxes are not allowed as deductions under section
164(a)(3) in determining net investment income if the taxpayer claims
the benefit of the foreign tax credit under section 901 with respect to
the same taxable year. For rules applicable to refunds of taxes
described in this paragraph, see paragraph (g)(2) of this section.
* * * * *
(4) * * *
(ii) * * *
Example 1. * * *
(iii) * * * Pursuant to paragraph (d) of this section, A takes
into account the $60,000 at ordinary loss from PRS and the $50,000
of long term capital gain in the computation of A's net gain. * * *
* * * * *
(h) * * *
(2) Applicable portion of a net operating loss. In any taxable year
beginning after December 31, 2012, in which a taxpayer incurs a net
operating loss, the applicable portion of such loss is the lesser of:
* * * * *
0
Par. 7. Section 1.1411-5 is amended by revising paragraph (b)(2)(i) and
(b)(2)(iii) to read as follows:
Sec. 1.1411-5 Trades or businesses to which tax applies.
* * * * *
(b) * * *
(2) * * * (i) Income and gain recharacterization. To the extent
that any income or gain from a trade or business is recharaterized as
``not from a passive activity'' by reason of Sec. 1.469-2T(f)(2),
Sec. 1.469-2(f)(5), or Sec. 1.469-2(f)(6), such trade or business
does not constitute a passive activity within the meaning of paragraph
(b)(1)(ii) of this section solely with respect to such recharaterized
income or gain.
* * * * *
(iii) Exception for certain portfolio recharacterizations. To the
extent that any income or gain from a trade or business is
recharacterized as ``not from a passive activity'' and is further
characterized as portfolio income under Sec. 1.469-2(f)(10) or Sec.
1.469-2(c)(2)(iii)(F), then such trade or business constitutes a
passive activity within the meaning of paragraph (b)(1)(ii) of this
section solely with respect to such recharacterized income or gain.
* * * * *
0
Par. 8. Section 1.1411-10 is amended as follows:
0
1. Revise paragraph (c)(5)(i)(B).
0
2. In paragraph (h) Example 2. (ii)(A), revise the first sentence.
The revisions read as follows:
Sec. 1.1411-10 Controlled foreign corporations and passive foreign
investment companies.
* * * * *
(c) * * *
(5) * * *
(i) * * *
(B) Decreasing the amount of investment income determined for
chapter 1 purposes under section 163(d)(4)(B) by the amount included in
gross income for chapter 1 purposes under section 951(a) or section
1293(a) that is attributable to a CFC or QEF with respect to which an
election under paragraph (g) of this section is not in effect; and
* * * * *
(h) * * *
Example 2. * * *
[[Page 18161]]
(ii) * * * (A) In 2016, A does not include the $15,000 section
951(a)(1)(A) income inclusion in A's net investment income under
section 1411(c)(1)(A)(i) and Sec. 1.1411-1(a)(1)(i). * * *
* * * * *
Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division,
Associate Chief Counsel, (Procedure and Administration).
[FR Doc. 2014-07160 Filed 3-31-14; 8:45 am]
BILLING CODE 4830-01-P
