Qualified Nonpersonal Use Vehicles, 27934-27938 [2010-11767]
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Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Rules and Regulations
terminates (determined without regard
to any extension thereof); or
(2) December 31, 2008.
(B) Treatment of plans with both
collectively bargained and noncollectively bargained employees. If a
collective bargaining agreement applies
to some, but not all, of the plan
participants, the definition of whether
the plan is considered a collectively
bargained plan for purposes of this
paragraph (g)(1)(ii) is made in the same
manner as the definition of whether a
plan is collectively bargained under
section 436(f)(3).
(2) Regulatory effective/applicability
date. This section is effective and
applicable for plan years beginning on
or after January 1, 2011.
(3) Statutory transition rules—(i)
General rule. Pursuant to section
401(a)(35)(H), in the case of the portion
of an account to which paragraph (c) of
this section applies and that consists of
employer securities acquired in a plan
year beginning before January 1, 2007,
the requirements of paragraph (c) of this
section only apply to the applicable
percentage of such securities.
(ii) Applicable percentage—(A)
Phase-in percentage. For purposes of
this paragraph (g)(3), the applicable
percentage is determined as follows—
Plan year to which paragraph (c) of this section
applies:
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1st .....................................
2nd ....................................
3rd and following ..............
Steven T. Miller,
Deputy Commissioner for Services and
Enforcement.
Approved: May 5, 2010.
Michael F. Mundaca,
Assistant Secretary of the Treasury (Tax
Policy).
[FR Doc. 2010–11924 Filed 5–18–10; 8:45 am]
BILLING CODE 4830–01–P
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9483]
RIN 1545–BH65
Qualified Nonpersonal Use Vehicles
AGENCY: Internal Revenue Service (IRS),
Treasury.
ACTION: Final regulations.
SUMMARY: This document contains final
regulations relating to qualified
nonpersonal use vehicles as defined in
section 274(i). Qualified nonpersonal
use vehicles are excepted from the
substantiation requirements of section
274(d)(4) that apply to listed property as
defined in section 280F(d)(4). These
final regulations add clearly marked
public safety officer vehicles as a new
The applicable
type of qualified nonpersonal use
percentage is:
vehicle. These final regulations affect
employers that provide their employees
33
66 with qualified nonpersonal use vehicles
100 and the employees who use such
vehicles.
(B) Special rule. For a plan for which
the special effective date under section
901(c)(3) of PPA ’06 applies, the
applicable percentage under this
paragraph (g)(3)(ii) is determined
without regard to the delayed effective
date in section 901(c)(3)(A) and (B) of
PPA ’06.
(iii) Nonapplication for participants
age 55 with three years of service.
Paragraph (g)(3)(i) of this section does
not apply to an individual who is a
participant who attained age 55 and had
completed at least three years of service
(as defined in paragraph (c)(3) of this
section) before the first day of the first
plan year beginning after December 31,
2005.
(iv) Separate application by class of
securities. This paragraph (g)(3) applies
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separately with respect to each class of
securities.
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DATES: Effective Date: These regulations
are effective on May 19, 2010.
Applicability Date: These regulations
apply to uses of clearly marked public
safety officer vehicles occurring after
May 19, 2010.
FOR FURTHER INFORMATION CONTACT: Don
Parkinson at (202) 622–6040 (not a tollfree number).
SUPPLEMENTARY INFORMATION:
Background
This document contains final Income
Tax Regulations under section 274(i)
added by section 2(b) of Public Law 99–
44 (May 24, 1985), which provides a
definition of qualified nonpersonal use
vehicle. Temporary Regulation § 1.274–
5T(k), identifying categories of qualified
nonpersonal use vehicles and
Temporary Regulation § 1.274–5T(l),
providing for definitions of the terms
‘‘automobile,’’ ‘‘vehicle,’’ ‘‘employer,’’
‘‘employee,’’ and ‘‘personal use’’ were
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issued in 1985. (TD 8061 1982–5 CB 93
(1985)). A notice of proposed
rulemaking was issued by crossreference to Temporary Regulation
§ 1.274–5T(k). (LR–145–84, 50 FR
46088, 1985–2 CB 809 (1985)).
On June 9, 2008, proposed regulations
(REG–106897–08) were published in the
Federal Register (73 FR 32500). The
proposed regulations incorporated the
text of § 1.274–5T(k) and added clearly
marked public safety officer vehicles as
a new type of qualified nonpersonal use
vehicle, listed along with clearly
marked police and fire vehicles at
§ 1.274–5(k)(2)(ii)(A). A definition of
clearly marked public safety officer
vehicles was added to the provision
defining clearly marked police and fire
vehicles at § 1.274–5(k)(3), and an
example illustrating application of the
rules to a public safety officer vehicle
was added at § 1.274–5(k)(8) Example 3.
The proposed regulations incorporated
the text of § 1.274–5T(l) with no
changes. The corresponding provisions
of the proposed regulations in LR–145–
84 were withdrawn on June 8, 2008.
Written public comments on the
proposed regulations at § 1.274–5(k) and
(l) were received and no hearing was
requested. After consideration of all the
comments, these final regulations adopt
the provisions of the proposed
regulations with an amendment to
Example 3 and the provision of a new
Example 4 in § 1.274–5(k)(8) which are
intended to assist taxpayers in
determining whether individual
employees meet the definition of public
safety officer. The temporary regulations
at § 1.274–5T(k) and (l) are withdrawn
concurrently with the publication of
these final regulations in the Federal
Register. The remaining temporary
regulations at § 1.274–5T are unaffected
by this Treasury decision.
Summary of Comments and
Explanation of Provisions
Section 274(d) provides that a
taxpayer is not allowed a deduction or
credit for certain expenses unless the
expenses are substantiated. These
substantiation requirements apply to
expenses incurred in the of use of any
listed property (defined in section
280F(d)(4)), which includes any
passenger automobile and any other
property used as a means of
transportation. Section 274(d) does not
apply to any qualified nonpersonal use
vehicle as defined in section 274(i).
Both business and personal use of a
vehicle that meets the criteria to be a
qualified nonpersonal use vehicle under
section 274(i) will also qualify as a
working condition fringe benefit that is
excluded from the recipient’s income
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Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Rules and Regulations
under section 132(d). 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 both the
business and the personal use of the
vehicle will be excluded from the
employee’s income as a working
condition fringe benefit under section
132(d).
Section 274(i) provides that a
qualified nonpersonal use vehicle is any
vehicle which by reason of its nature is
not likely to be used more than a de
minimis amount for personal purposes.
The legislative history to section 274(i)
provided a list of qualified nonpersonal
use vehicles and identified a number of
examples of qualified nonpersonal use
vehicles such as school buses, qualified
specialized utility repair trucks, and
qualified moving vans. The legislative
history indicated that Congress wanted
the Commissioner to expand the list to
include other vehicles appropriate for
listing because by their nature it is
highly unlikely that they will be used
more than a very minimal amount for
personal purposes. H.R. Rep. No. 99–34,
at 11 (1985).
Passenger automobiles such as sedans
and sport utility vehicles are generally
not exempt from taxation as qualified
nonpersonal use vehicles because by
design they can easily be used for
personal purposes. However, unmarked
law enforcement vehicles and clearly
marked police and fire vehicles are
included in the list of qualified
nonpersonal use vehicles set forth in the
legislative history to section 274(i) and
incorporated into these final
regulations.
Under prior rules, clearly marked
vehicles provided to Federal, State and
local government workers who respond
to emergency situations did not satisfy
the current regulations governing
qualified nonpersonal use vehicles if the
individual workers were not employed
by either the fire department or police
department. These final regulations,
consistent with the proposed
regulations, add clearly marked public
safety officer vehicles to the list of
qualified nonpersonal use vehicles so
that emergency responders who are not
employed by either the fire department
or police department receive the same
treatment as those who work for the
police or fire department.
A clearly marked public safety officer
vehicle is a vehicle owned or leased by
a governmental unit or any agency or
instrumentality thereof, that is required
to be used for commuting by a public
safety officer as defined in section
402(l)(4)(C) who, when not on a regular
shift, is on call at all times, provided
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that any personal use (other than
commuting) of the vehicle outside the
limit of the public safety officer’s
obligation to respond to an emergency is
prohibited by such governmental unit.
A public safety officer vehicle is clearly
marked if, through painted insignia or
words, it is readily apparent that the
vehicle is a public safety officer vehicle.
Section 402(l)(4)(C) provides that the
term ‘‘public safety officer’’ shall have
the same meaning given such term by
the Omnibus Crime Control and Safe
Streets Act of 1968, as codified at 42
U.S.C. 3796b(9)(A). The definition of
public safety officer is part of the Public
Safety Officer’s Benefits Act which was
enacted as part L of Title I of the
Omnibus Crime Control and Safe Streets
Act of 1968. 42 U.S.C. 3796b(9)(A)
defines public safety officer as ‘‘an
individual serving a public agency in an
official capacity, with or without
compensation, as a law enforcement
officer, a firefighter, a chaplain, or as a
member of a rescue squad or ambulance
crew.’’
Some commenters suggested
eliminating some of the requirements
pertaining to qualified nonpersonal use
vehicles. In particular, commenters
suggested elimination of the
requirement that the vehicle be clearly
marked, or the requirement that the
individual be on call at all times, or the
requirement that the vehicle be
specially equipped.
Qualified nonpersonal use vehicles
were exempted from the substantiation
and recordkeeping requirements
imposed under section 274(d) and
minimal personal use of such vehicles
was excluded from income because the
nature of the vehicles prevents more
than a de minimis amount of personal
use. If an individual is not on call at all
times, personal use may be more than
de minimis. If the vehicle is not
required to be specially equipped or
clearly marked, the vehicle will
function easily as a personal use vehicle
and is not readily distinguishable from
vehicles routinely used for personal
purposes. Thus, these suggested changes
were not adopted because they conflict
with the underlying goal and purpose of
the statute.
A number of comments were made
urging that various specific types of
workers be included within the
definition ‘‘public safety officer.’’ For
example, commenters suggested the
definition of public safety officer should
be expanded to include employees who
respond to local disasters such as flash
floods, pipeline ruptures, hazardous
material accidents, bridge collapses, and
mining accidents. Additionally
commenters suggested that child
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protective service workers, emergency
management personnel, and members of
Incident Management Teams which are
part of the Department of Homeland
Security’s National Incident
Management System should all be
included in the definition of public
safety officer.
The determination of the status of an
individual as a public safety officer is
made pursuant to a facts and
circumstances analysis based on an
evaluation of the relevant criteria in the
Public Safety Officers’ Benefits Act of
1978 and its regulations (PSOB
Regulations, 28 CFR part 32). The PSOB
regulations set forth criteria to be used
in determining whether individual
workers are public safety officers. For
example, the PSOB Regulations at 28
CFR 32.3 define ‘‘rescue squad or
ambulance crew’’ as follows: ‘‘a squad or
crew whose members are rescue
workers, ambulance drivers,
paramedics, health-care responders,
emergency medical technicians, or other
similar workers who—
(1) Are trained in rescue activity or
the provision of emergency medical
services; and
(2) As such members, have the legal
authority and responsibility to—
(i) Engage in rescue activity; or
(ii) Provide emergency medical
services.
Rescue activity means search or
rescue assistance in locating or
extracting from danger persons lost,
missing, or in imminent danger of
serious bodily harm.
Emergency medical services means—
(1) Provision of first-response
emergency medical care (other than in
a permanent medical-care facility); or
(2) Transportation of persons in
medical distress (or under emergency
conditions) to medical-care facilities.
As a general rule, the determination of
the status of an individual as a rescue
squad or ambulance crew member is
based on whether that individual is
trained to engage in rescue activity or to
provide emergency medical services and
whether that individual has legal
authority and legal responsibility to
engage in rescue activity or provide
emergency medical services.
Thus, an individual’s job title is not
determinative of his or her status as a
public safety officer. Instead, the
determination is made based on the
facts and circumstances of the
individual’s employment, including
their training, legal authority and legal
responsibility. Example 3 has been
modified and an Example 4 has been
added to clarify this analysis using the
criteria in the PSOB Regulations.
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Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Rules and Regulations
Moreover, these final regulations have
not been amended to add additional job
titles to the definition of public safety
officer as suggested by commenters
because an employee’s job title is not
determinative of their status as a public
safety officer.
Special Analyses
It has been determined that this
Treasury decision is not a significant
regulatory action as defined in
Executive Order 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) does not apply
to these regulations. It is hereby
certified that these regulations will not
have a significant economic impact on
a substantial number of small entities.
This certification is based upon the fact
that these regulations do not require a
collection of information and do not
impose any new or different
requirements on small entities.
Therefore, a Regulatory Flexibility
Analysis under the Regulatory
Flexibility Act (5 U.S.C. chapter 6) is
not required. Pursuant to section 7805(f)
of the Internal Revenue Code, this
notice of proposed rulemaking has been
submitted to the Chief Council for
Advocacy of the Small Business
Administration for comment on its
impact on small business.
Drafting Information
The principal author of these
regulations is Don M. Parkinson, Office
of the Associate Chief Counsel (Tax
Exempt and Government Entities).
However, other personnel from the IRS
and Treasury Department participated
in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and
recordkeeping requirements.
Adoption of Amendments to the
Regulations
Accordingly, 26 CFR part 1 is
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 1.132–5 paragraph (h)
is revised to read as follows:
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■
§ 1.132–5
Working condition fringes.
*
*
*
*
*
(h) Qualified nonpersonal use
vehicles—(1) In general. Except as
provided in paragraph (h)(2) of this
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section, 100 percent of the value of the
use of a qualified nonpersonal use
vehicle (as described in § 1.274–5(k)) is
excluded from gross income as a
working condition fringe, provided that,
in the case of a vehicle described in
§ 1.274–5(k)(3) through (8), the use of
the vehicle conforms to the
requirements of paragraphs (k)(3)
through (8).
(2) Shared usage of qualified
nonpersonal use vehicles. In general, a
working condition fringe under this
paragraph (h) is available to the driver
and all passengers of a qualified
nonpersonal use vehicle. However, a
working condition fringe under this
paragraph (h) is available only with
respect to the driver and not with
respect to any passengers of a qualified
nonpersonal use vehicle described in
§ 1.274–5(k)(2)(ii)(L) or (P).
*
*
*
*
*
■ Par. 3. Section 1.274–5 paragraphs (k)
and (l) and the last sentence of
paragraph (m) are revised to read as
follows:
§ 1.274–5
Substantiation requirements.
*
*
*
*
*
(k) Exceptions for qualified
nonpersonal use vehicles—(1) In
general. The substantiation
requirements of section 274(d) and this
section do not apply to any qualified
nonpersonal use vehicle (as defined in
paragraph (k)(2) of this section).
(2) Qualified nonpersonal use
vehicle—(i) In general. For purposes of
section 274(d) and this section, the term
qualified nonpersonal use vehicle
means any vehicle which, by reason of
its nature (that is, design), is not likely
to be used more than a de minimis
amount for personal purposes.
(ii) List of vehicles. Vehicles which
are qualified nonpersonal use vehicles
include the following:
(A) Clearly marked police, fire, and
public safety officer vehicles (as defined
and to the extent provided in paragraph
(k)(3) of this section).
(B) Ambulances used as such or
hearses used as such.
(C) Any vehicle designed to carry
cargo with a loaded gross vehicle weight
over 14,000 pounds.
(D) Bucket trucks (cherry pickers).
(E) Cement mixers.
(F) Combines.
(G) Cranes and derricks.
(H) Delivery trucks with seating only
for the driver, or only for the driver plus
a folding jump seat.
(I) Dump trucks (including garbage
trucks).
(J) Flatbed trucks.
(K) Forklifts.
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(L) Passenger buses used as such with
a capacity of at least 20 passengers.
(M) Qualified moving vans (as defined
in paragraph (k)(4) of this section).
(N) Qualified specialized utility repair
trucks (as defined in paragraph (k)(5) of
this section).
(O) Refrigerated trucks.
(P) School buses (as defined in section
4221(d)(7)(c)).
(Q) Tractors and other special purpose
farm vehicles.
(R) Unmarked vehicles used by law
enforcement officers (as defined in
paragraph (k)(6) of this section) if the
use is officially authorized.
(S) Such other vehicles as the
Commissioner may designate.
(3) Clearly marked police, fire, or
public safety officer vehicles. A police,
fire, or public safety officer vehicle is a
vehicle, owned or leased by a
governmental unit, or any agency or
instrumentality thereof, that is required
to be used for commuting by a police
officer, fire fighter, or public safety
officer (as defined in section 402(l)(4)(C)
of this chapter) who, when not on a
regular shift, is on call at all times,
provided that any personal use (other
than commuting) of the vehicle outside
the limit of the police officer’s arrest
powers or the fire fighter’s or public
safety officer’s obligation to respond to
an emergency is prohibited by such
governmental unit. A police, fire, or
public safety officer vehicle is clearly
marked if, through painted insignia or
words, it is readily apparent that the
vehicle is a police, fire, or public safety
officer vehicle. A marking on a license
plate is not a clear marking for purposes
of this paragraph (k).
(4) Qualified moving van. The term
qualified moving van means any truck
or van used by a professional moving
company in the trade or business of
moving household or business goods
if—
(i) No personal use of the van is
allowed other than for travel to and
from a move site (or for de minimis
personal use, such as a stop for lunch
on the way between two move sites);
(ii) Personal use for travel to and from
a move site is an irregular practice (that
is, not more than five times a month on
average); and
(iii) Personal use is limited to
situations in which it is more
convenient to the employer, because of
the location of the employee’s residence
in relation to the location of the move
site, for the van not to be returned to the
employer’s business location.
(5) Qualified specialized utility repair
truck. The term qualified specialized
utility repair truck means any truck (not
including a van or pickup truck)
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specifically designed and used to carry
heavy tools, testing equipment, or parts
if—
(i) The shelves, racks, or other
permanent interior construction which
has been installed to carry and store
such heavy items is such that it is
unlikely that the truck will be used
more than a de minimis amount for
personal purposes; and
(ii) The employer requires the
employee to drive the truck home in
order to be able to respond in
emergency situations for purposes of
restoring or maintaining electricity, gas,
telephone, water, sewer, or steam utility
services.
(6) Unmarked law enforcement
vehicles—(i) In general. The
substantiation requirements of section
274(d) and this section do not apply to
officially authorized uses of an
unmarked vehicle by a ‘‘law
enforcement officer’’. To qualify for this
exception, any personal use must be
authorized by the Federal, State, county,
or local governmental agency or
department that owns or leases the
vehicle and employs the officer, and
must be incident to law-enforcement
functions, such as being able to report
directly from home to a stakeout or
surveillance site, or to an emergency
situation. Use of an unmarked vehicle
for vacation or recreation trips cannot
qualify as an authorized use.
(ii) Law enforcement officer. The term
law enforcement officer means an
individual who is employed on a fulltime basis by a governmental unit that
is responsible for the prevention or
investigation of crime involving injury
to persons or property (including
apprehension or detention of persons
for such crimes), who is authorized by
law to carry firearms, execute search
warrants, and to make arrests (other
than merely a citizen’s arrest), and who
regularly carries firearms (except when
it is not possible to do so because of the
requirements of undercover work). The
term ‘‘law enforcement officer’’ may
include an arson investigator if the
investigator otherwise meets the
requirements of this paragraph (k)(6)(ii),
but does not include Internal Revenue
Service special agents.
(7) Trucks and vans. The
substantiation requirements of section
274(d) and this section apply generally
to any pickup truck or van, unless the
truck or van has been specially modified
with the result that it is not likely to be
used more than a de minimis amount
for personal purposes. For example, a
van that has only a front bench for
seating, in which permanent shelving
that fills most of the cargo area has been
installed, that constantly carries
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merchandise or equipment, and that has
been specially painted with advertising
or the company’s name, is a vehicle not
likely to be used more than a de
minimis amount for personal purposes.
(8) Examples. The following examples
illustrate the provisions of paragraph
(k)(3) and (6) of this section:
Example 1. Detective C, who is a ‘‘law
enforcement officer’’ employed by a state
police department, headquartered in City M,
is provided with an unmarked vehicle
(equipped with radio communication) for use
during off-duty hours because C must be able
to communicate with headquarters and be
available for duty at any time (for example,
to report to a surveillance or crime site). The
police department generally has officially
authorized personal use of the vehicle by C
but has prohibited use of the vehicle for
recreational purposes or for personal
purposes outside the state. Thus, C’s use of
the vehicle for commuting between
headquarters or a surveillance site and home
and for personal errands is authorized
personal use as described in paragraph
(k)(6)(i) of this section. With respect to these
authorized uses the vehicle is not subject to
the substantiation requirements of section
274(d) and the value of these uses is not
included in C’s gross income.
Example 2. Detective T is a ‘‘law
enforcement officer’’ employed by City M. T
is authorized to make arrests only within M’s
city limits. T, along with all other officers of
the force, is ordinarily on duty for eight
hours each work day and on call during the
other sixteen hours. T is provided with the
use of a clearly marked police vehicle in
which T is required to commute to his home
in City M. The police department’s official
policy regarding marked police vehicles
prohibits its personal use (other than
commuting) of the vehicles outside the city
limits. When not using the vehicle on the job,
T uses the vehicle only for commuting,
personal errands on the way between work
and home, and personal errands within City
M. All use of the vehicle by T conforms to
the requirements of paragraph (k)(3) of this
section. Therefore, the value of that use is
excluded from T’s gross income as a working
condition fringe and the vehicle is not
subject to the substantiation requirements of
section 274(d).
Example 3. Director C is employed by City
M as the director of the City’s rescue squad
and is provided with a vehicle for use in
responding to emergencies. Director C is
trained in rescue activity and has the legal
authority and legal responsibility to engage
in rescue activity. The city’s rescue squad is
not a part of City M’s police or fire
departments. The director’s vehicle is a
sedan which is painted with insignia and
words identifying the vehicle as being owned
by the City’s rescue squad. C, when not on
a regular shift, is on call at all times. The
City’s official policy regarding clearly marked
public safety officer vehicles prohibits
personal use (other than for commuting) of
the vehicle outside of the limits of the public
safety officer’s obligation to respond to an
emergency. When not using the vehicle to
respond to emergencies, City M authorizes C
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27937
to use the vehicle only for commuting,
personal errands on the way between work
and home, and personal errands within the
limits of C’s obligation to respond to
emergencies. With respect to these
authorized uses, the vehicle is not subject to
the substantiation requirements of section
274(d) and the value of these uses is not
includable in C’s gross income.
Example 4. Coroner D is employed by
County N to investigate and determine the
cause, time, and manner of certain deaths
occurring in the County. Coroner D also
safeguards the property of the deceased,
notifies the next of kin, conducts inquests,
and arranges for the burial of indigent
persons. D is provided with a vehicle for use
by County N. The vehicle is to be used in
County N business and for commuting.
Personal use other than for commuting
purposes is forbidden. D is trained in rescue
activity but has no legal authority or legal
responsibility to engage in rescue activity.
D’s vehicle is a sedan which is painted with
insignia and words identifying it as a County
N vehicle. D, when not on a regular shift, is
on call at all times. D does not satisfy the
criteria of a public safety officer under 28
CFR 32.3 (2008). Thus, D’s vehicle cannot
qualify as a clearly marked public safety
officer vehicle. Accordingly, business use of
the vehicle is subject to the substantiation
requirements of section 274(d), and the value
of any personal use of the vehicle, such as
commuting, is includable in D’s gross
income.
(l) Definitions. For purposes of section
274(d) and this section, the terms
automobile and vehicle have the same
meanings as prescribed in § 1.61–
21(d)(1)(ii) and (e)(2), respectively. Also,
for purposes of section 274(d) and this
section, the terms employer, employee
and personal use have the same
meanings as prescribed in § 1.274–6T(e).
(m) * * * However, paragraph (j)(3)
of this section applies to expenses paid
or incurred after September 30, 2002,
and paragraph (k) applies to clearly
marked public safety officer vehicles, as
defined in § 1.274–5(k)(3), only with
respect to uses occurring after May 19,
2010.
■ Par. 4. Section 1.274–5T is amended
by revising paragraphs (k) and (l) to read
as follows:
§ 1.274–5T Substantiation requirements
(temporary).
*
*
*
*
*
(k) and (l) [Reserved]. For further
guidance, see § 1.274–5(k) and (l).
*
*
*
*
*
■ Par. 5. Section 1.280F–6 is amended
by revising paragraph (b)(2)(ii) to read as
follows:
§ 1.280F–6
Special rules and definitions.
*
*
*
*
*
(b) * * *
(2) * * *
(ii) Exception. The term ‘‘listed
property’’ does not include any vehicle
E:\FR\FM\19MYR1.SGM
19MYR1
27938
Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Rules and Regulations
that is a qualified nonpersonal use
vehicle as defined in section 274(i) and
§ 1.274–5(k).
*
*
*
*
*
Steven T. Miller,
Deputy Commissioner for Services and
Enforcement.
Approved: May 5, 2010.
Michael Mundaca,
Assistant Secretary of the Treasury (Tax
Policy).
Table of Contents
I. Proposed Action
II. Public Comments and EPA Responses
III. Final Action
IV. Statutory and Executive Order Reviews
[FR Doc. 2010–11767 Filed 5–18–10; 8:45 am]
BILLING CODE 4830–01–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Part 52
[EPA–R09–OAR–2009–0269; FRL–9152–6]
Approval and Promulgation of
Implementation Plans; State of
California; Legal Authority
erowe on DSK5CLS3C1PROD with RULES
AGENCY: Environmental Protection
Agency (EPA).
ACTION: Final rule.
SUMMARY: EPA is taking final action to
clarify the contents of the applicable
implementation plan for the State of
California under the Clean Air Act.
Specifically, EPA is taking final action
to clarify that the statutory provisions
submitted by California and approved
by EPA in 1972 supporting the State’s
legal authority chapter of the original
implementation plan were superseded
by a subsequent approval by EPA in
1980 of California’s revision to the legal
authority chapter of the plan. EPA is
taking this action to clarify the status in
the California plan of the statutory
provisions submitted and approved in
1972.
DATES: Effective Date: This rule is
effective on June 18, 2010.
ADDRESSES: EPA has established docket
number EPA–R09–OAR–2009–0269 for
this action. The index to the docket is
available electronically at https://
www.regulations.gov or in hard copy at
EPA Region IX, 75 Hawthorne Street,
San Francisco, California. While all
documents in the docket are listed in
the index, some information may be
publicly available only at the hard copy
location (e.g., copyrighted material), and
some may not be publicly available in
either location (e.g., CBI). To inspect the
hard copy materials, please schedule an
appointment during normal business
hours with the contact listed in the FOR
FURTHER INFORMATION CONTACT section.
FOR FURTHER INFORMATION CONTACT:
Gerardo Rios, Chief, Permits Office
VerDate Mar<15>2010
13:05 May 18, 2010
Jkt 220001
(AIR–3), U.S. Environmental Protection
Agency, Region IX, (415) 972–3974:
rios.gerardo@epa.gov.
SUPPLEMENTARY INFORMATION:
Throughout this document, ‘‘we,’’ ‘‘us’’
and ‘‘our’’ refer to EPA.
I. Proposed Action
On January 29, 2010 (75 FR 4742),
under the Clean Air Act (CAA or ‘‘Act’’),
we proposed to clarify that the statutory
provisions submitted by California in
1972 supporting the State’s legal
authority chapter of the original
implementation plan were superseded
by a subsequent approval by EPA in
1980 of a revision to California’s legal
authority chapter of the plan.
In support of our proposed action, we
provided a detailed account of the
regulatory context in which the original
California State implementation plan
(SIP) was submitted and approved by
EPA. We also described in detail the
contents of the original California SIP,
which consisted of 13 parts, the first
part (‘‘State General Plan’’) of which
included a chapter 7 (‘‘Legal
Considerations’’), referred to herein as
the ‘‘legal authority’’ chapter. The
original SIP also included an appendix
(entitled ‘‘Appendix II: State Statutes
and other Legal Documents Pertinent to
Air Pollution Control in California’’) to
the legal authority chapter. The legal
authority chapter included many
citations to individual sections within
the California Health & Safety Code
(CH&SC) and other California codes, as
well as citations to (then) recently
approved legislation, and attorney
general opinions as support for the
assurance that adequate legal authority
exists in the State to meet CAA and EPA
SIP requirements.
As described in the proposal, the
appendix to the legal authority chapter
in the plan (herein, ‘‘appendix II’’)
included the specific sections of
California code and other legal
documents cited in chapter 7, but also
included many sections of California
code that were not cited specifically in
chapter 7. Our proposed rule describes
in detail the contents of appendix II and
its 14 categories of statutory and other
legal documents.
In May 1972, we approved in part and
disapproved in part the original
California SIP. See 37 FR 10842 (May
31, 1972) and 40 CFR 52.220(b). EPA’s
approval included both chapter 7 and
the statutory and other documents
PO 00000
Frm 00016
Fmt 4700
Sfmt 4700
contained in appendix II as described
above.
As explained in our proposed rule, in
response to EPA’s request and in
response to the Clean Air Act
Amendments of 1977, California
undertook a comprehensive update to
the California SIP. On March 16, 1979,
the California Air Resources Board
(ARB) submitted a revision to the legal
authority chapter of the SIP, entitled
‘‘Chapter 3—Legal Authority, Revision
to State of California Implementation
Plan for the Attainment and
Maintenance of Ambient Air Quality
Standards (December 1978),’’ (also
referred to herein as ‘‘Chapter 3—Legal
Authority’’ or the ‘‘revised legal
authority’’ chapter). Much like the
original legal authority chapter, the
revised legal authority chapter provides
an overview of air pollution control in
California. While the general topics
covered in the revised legal authority
chapter were similar to those covered in
the original legal authority chapter, the
discussion is completely re-organized
and updated to reflect, among other
things, recodifications of statutory
provisions. Also, like the legal authority
chapter in the original SIP, the revised
legal authority chapter includes
numerous citations to individual
sections of the CH&SC (which had been
re-numbered and re-codified since the
time of the original SIP), certain
citations to other California codes and
other legal documents. However, unlike
the legal authority chapter in the
original SIP, the revised legal authority
chapter, as submitted in 1979, did not
include physical copies of the actual
statutory provisions nor the other
documents cited in the chapter. Instead,
the 1979 SIP revision simply
incorporates by reference the 1978
edition of California Air Pollution
Control Laws as ‘‘appendix 3–A’’ to the
chapter. Later in 1979, we proposed
approval of the revised SIP ‘‘Chapter 3—
Legal Authority’’ as an update and
clarification of the 1972 SIP. See 44 FR
38912 (July 3, 1979). The following year,
we took final action, effective
September 10, 1980, to approve the
revised legal authority chapter. See 45
FR 53136 (August 11, 1980) and 40 CFR
52.220(c)(48). Since that time, EPA has
not approved any other revision to the
chapter that addresses legal authority in
the California SIP.
Based upon our review of the relevant
provisions of the original California SIP
and the related 1979 SIP revision, and
the corresponding EPA approval
actions, we proposed to clarify the
contents of the SIP to reflect our
determination that the statutory
provisions and other legal documents
E:\FR\FM\19MYR1.SGM
19MYR1
]]>Agencies
[Federal Register Volume 75, Number 96 (Wednesday, May 19, 2010)]
[Rules and Regulations]
[Pages 27934-27938]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-11767]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9483]
RIN 1545-BH65
Qualified Nonpersonal Use Vehicles
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
-----------------------------------------------------------------------
SUMMARY: This document contains final regulations relating to qualified
nonpersonal use vehicles as defined in section 274(i). Qualified
nonpersonal use vehicles are excepted from the substantiation
requirements of section 274(d)(4) that apply to listed property as
defined in section 280F(d)(4). These final regulations add clearly
marked public safety officer vehicles as a new type of qualified
nonpersonal use vehicle. These final regulations affect employers that
provide their employees with qualified nonpersonal use vehicles and the
employees who use such vehicles.
DATES: Effective Date: These regulations are effective on May 19, 2010.
Applicability Date: These regulations apply to uses of clearly
marked public safety officer vehicles occurring after May 19, 2010.
FOR FURTHER INFORMATION CONTACT: Don Parkinson at (202) 622-6040 (not a
toll-free number).
SUPPLEMENTARY INFORMATION:
Background
This document contains final Income Tax Regulations under section
274(i) added by section 2(b) of Public Law 99-44 (May 24, 1985), which
provides a definition of qualified nonpersonal use vehicle. Temporary
Regulation Sec. 1.274-5T(k), identifying categories of qualified
nonpersonal use vehicles and Temporary Regulation Sec. 1.274-5T(l),
providing for definitions of the terms ``automobile,'' ``vehicle,''
``employer,'' ``employee,'' and ``personal use'' were issued in 1985.
(TD 8061 1982-5 CB 93 (1985)). A notice of proposed rulemaking was
issued by cross-reference to Temporary Regulation Sec. 1.274-5T(k).
(LR-145-84, 50 FR 46088, 1985-2 CB 809 (1985)).
On June 9, 2008, proposed regulations (REG-106897-08) were
published in the Federal Register (73 FR 32500). The proposed
regulations incorporated the text of Sec. 1.274-5T(k) and added
clearly marked public safety officer vehicles as a new type of
qualified nonpersonal use vehicle, listed along with clearly marked
police and fire vehicles at Sec. 1.274-5(k)(2)(ii)(A). A definition of
clearly marked public safety officer vehicles was added to the
provision defining clearly marked police and fire vehicles at Sec.
1.274-5(k)(3), and an example illustrating application of the rules to
a public safety officer vehicle was added at Sec. 1.274-5(k)(8)
Example 3. The proposed regulations incorporated the text of Sec.
1.274-5T(l) with no changes. The corresponding provisions of the
proposed regulations in LR-145-84 were withdrawn on June 8, 2008.
Written public comments on the proposed regulations at Sec. 1.274-
5(k) and (l) were received and no hearing was requested. After
consideration of all the comments, these final regulations adopt the
provisions of the proposed regulations with an amendment to Example 3
and the provision of a new Example 4 in Sec. 1.274-5(k)(8) which are
intended to assist taxpayers in determining whether individual
employees meet the definition of public safety officer. The temporary
regulations at Sec. 1.274-5T(k) and (l) are withdrawn concurrently
with the publication of these final regulations in the Federal
Register. The remaining temporary regulations at Sec. 1.274-5T are
unaffected by this Treasury decision.
Summary of Comments and Explanation of Provisions
Section 274(d) provides that a taxpayer is not allowed a deduction
or credit for certain expenses unless the expenses are substantiated.
These substantiation requirements apply to expenses incurred in the of
use of any listed property (defined in section 280F(d)(4)), which
includes any passenger automobile and any other property used as a
means of transportation. Section 274(d) does not apply to any qualified
nonpersonal use vehicle as defined in section 274(i). Both business and
personal use of a vehicle that meets the criteria to be a qualified
nonpersonal use vehicle under section 274(i) will also qualify as a
working condition fringe benefit that is excluded from the recipient's
income
[[Page 27935]]
under section 132(d). 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 both the business and the
personal use of the vehicle will be excluded from the employee's income
as a working condition fringe benefit under section 132(d).
Section 274(i) provides that a qualified nonpersonal use vehicle is
any vehicle which by reason of its nature is not likely to be used more
than a de minimis amount for personal purposes. The legislative history
to section 274(i) provided a list of qualified nonpersonal use vehicles
and identified a number of examples of qualified nonpersonal use
vehicles such as school buses, qualified specialized utility repair
trucks, and qualified moving vans. The legislative history indicated
that Congress wanted the Commissioner to expand the list to include
other vehicles appropriate for listing because by their nature it is
highly unlikely that they will be used more than a very minimal amount
for personal purposes. H.R. Rep. No. 99-34, at 11 (1985).
Passenger automobiles such as sedans and sport utility vehicles are
generally not exempt from taxation as qualified nonpersonal use
vehicles because by design they can easily be used for personal
purposes. However, unmarked law enforcement vehicles and clearly marked
police and fire vehicles are included in the list of qualified
nonpersonal use vehicles set forth in the legislative history to
section 274(i) and incorporated into these final regulations.
Under prior rules, clearly marked vehicles provided to Federal,
State and local government workers who respond to emergency situations
did not satisfy the current regulations governing qualified nonpersonal
use vehicles if the individual workers were not employed by either the
fire department or police department. These final regulations,
consistent with the proposed regulations, add clearly marked public
safety officer vehicles to the list of qualified nonpersonal use
vehicles so that emergency responders who are not employed by either
the fire department or police department receive the same treatment as
those who work for the police or fire department.
A clearly marked public safety officer vehicle is a vehicle owned
or leased by a governmental unit or any agency or instrumentality
thereof, that is required to be used for commuting by a public safety
officer as defined in section 402(l)(4)(C) who, when not on a regular
shift, is on call at all times, provided that any personal use (other
than commuting) of the vehicle outside the limit of the public safety
officer's obligation to respond to an emergency is prohibited by such
governmental unit. A public safety officer vehicle is clearly marked
if, through painted insignia or words, it is readily apparent that the
vehicle is a public safety officer vehicle.
Section 402(l)(4)(C) provides that the term ``public safety
officer'' shall have the same meaning given such term by the Omnibus
Crime Control and Safe Streets Act of 1968, as codified at 42 U.S.C.
3796b(9)(A). The definition of public safety officer is part of the
Public Safety Officer's Benefits Act which was enacted as part L of
Title I of the Omnibus Crime Control and Safe Streets Act of 1968. 42
U.S.C. 3796b(9)(A) defines public safety officer as ``an individual
serving a public agency in an official capacity, with or without
compensation, as a law enforcement officer, a firefighter, a chaplain,
or as a member of a rescue squad or ambulance crew.''
Some commenters suggested eliminating some of the requirements
pertaining to qualified nonpersonal use vehicles. In particular,
commenters suggested elimination of the requirement that the vehicle be
clearly marked, or the requirement that the individual be on call at
all times, or the requirement that the vehicle be specially equipped.
Qualified nonpersonal use vehicles were exempted from the
substantiation and recordkeeping requirements imposed under section
274(d) and minimal personal use of such vehicles was excluded from
income because the nature of the vehicles prevents more than a de
minimis amount of personal use. If an individual is not on call at all
times, personal use may be more than de minimis. If the vehicle is not
required to be specially equipped or clearly marked, the vehicle will
function easily as a personal use vehicle and is not readily
distinguishable from vehicles routinely used for personal purposes.
Thus, these suggested changes were not adopted because they conflict
with the underlying goal and purpose of the statute.
A number of comments were made urging that various specific types
of workers be included within the definition ``public safety officer.''
For example, commenters suggested the definition of public safety
officer should be expanded to include employees who respond to local
disasters such as flash floods, pipeline ruptures, hazardous material
accidents, bridge collapses, and mining accidents. Additionally
commenters suggested that child protective service workers, emergency
management personnel, and members of Incident Management Teams which
are part of the Department of Homeland Security's National Incident
Management System should all be included in the definition of public
safety officer.
The determination of the status of an individual as a public safety
officer is made pursuant to a facts and circumstances analysis based on
an evaluation of the relevant criteria in the Public Safety Officers'
Benefits Act of 1978 and its regulations (PSOB Regulations, 28 CFR part
32). The PSOB regulations set forth criteria to be used in determining
whether individual workers are public safety officers. For example, the
PSOB Regulations at 28 CFR 32.3 define ``rescue squad or ambulance
crew'' as follows: ``a squad or crew whose members are rescue workers,
ambulance drivers, paramedics, health-care responders, emergency
medical technicians, or other similar workers who--
(1) Are trained in rescue activity or the provision of emergency
medical services; and
(2) As such members, have the legal authority and responsibility
to--
(i) Engage in rescue activity; or
(ii) Provide emergency medical services.
Rescue activity means search or rescue assistance in locating or
extracting from danger persons lost, missing, or in imminent danger of
serious bodily harm.
Emergency medical services means--
(1) Provision of first-response emergency medical care (other than
in a permanent medical-care facility); or
(2) Transportation of persons in medical distress (or under
emergency conditions) to medical-care facilities.
As a general rule, the determination of the status of an individual
as a rescue squad or ambulance crew member is based on whether that
individual is trained to engage in rescue activity or to provide
emergency medical services and whether that individual has legal
authority and legal responsibility to engage in rescue activity or
provide emergency medical services.
Thus, an individual's job title is not determinative of his or her
status as a public safety officer. Instead, the determination is made
based on the facts and circumstances of the individual's employment,
including their training, legal authority and legal responsibility.
Example 3 has been modified and an Example 4 has been added to clarify
this analysis using the criteria in the PSOB Regulations.
[[Page 27936]]
Moreover, these final regulations have not been amended to add
additional job titles to the definition of public safety officer as
suggested by commenters because an employee's job title is not
determinative of their status as a public safety officer.
Special Analyses
It has been determined that this Treasury decision is not a
significant regulatory action as defined in Executive Order 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) does not apply to these regulations. It is hereby
certified that these regulations will not have a significant economic
impact on a substantial number of small entities. This certification is
based upon the fact that these regulations do not require a collection
of information and do not impose any new or different requirements on
small entities. Therefore, a Regulatory Flexibility Analysis under the
Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required.
Pursuant to section 7805(f) of the Internal Revenue Code, this notice
of proposed rulemaking has been submitted to the Chief Council for
Advocacy of the Small Business Administration for comment on its impact
on small business.
Drafting Information
The principal author of these regulations is Don M. Parkinson,
Office of the Associate Chief Counsel (Tax Exempt and Government
Entities). However, other personnel from the IRS and Treasury
Department participated in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Adoption of Amendments to the Regulations
0
Accordingly, 26 CFR part 1 is amended as follows:
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 1.132-5 paragraph (h) is revised to read as follows:
Sec. 1.132-5 Working condition fringes.
* * * * *
(h) Qualified nonpersonal use vehicles--(1) In general. Except as
provided in paragraph (h)(2) of this section, 100 percent of the value
of the use of a qualified nonpersonal use vehicle (as described in
Sec. 1.274-5(k)) is excluded from gross income as a working condition
fringe, provided that, in the case of a vehicle described in Sec.
1.274-5(k)(3) through (8), the use of the vehicle conforms to the
requirements of paragraphs (k)(3) through (8).
(2) Shared usage of qualified nonpersonal use vehicles. In general,
a working condition fringe under this paragraph (h) is available to the
driver and all passengers of a qualified nonpersonal use vehicle.
However, a working condition fringe under this paragraph (h) is
available only with respect to the driver and not with respect to any
passengers of a qualified nonpersonal use vehicle described in Sec.
1.274-5(k)(2)(ii)(L) or (P).
* * * * *
0
Par. 3. Section 1.274-5 paragraphs (k) and (l) and the last sentence of
paragraph (m) are revised to read as follows:
Sec. 1.274-5 Substantiation requirements.
* * * * *
(k) Exceptions for qualified nonpersonal use vehicles--(1) In
general. The substantiation requirements of section 274(d) and this
section do not apply to any qualified nonpersonal use vehicle (as
defined in paragraph (k)(2) of this section).
(2) Qualified nonpersonal use vehicle--(i) In general. For purposes
of section 274(d) and this section, the term qualified nonpersonal use
vehicle means any vehicle which, by reason of its nature (that is,
design), is not likely to be used more than a de minimis amount for
personal purposes.
(ii) List of vehicles. Vehicles which are qualified nonpersonal use
vehicles include the following:
(A) Clearly marked police, fire, and public safety officer vehicles
(as defined and to the extent provided in paragraph (k)(3) of this
section).
(B) Ambulances used as such or hearses used as such.
(C) Any vehicle designed to carry cargo with a loaded gross vehicle
weight over 14,000 pounds.
(D) Bucket trucks (cherry pickers).
(E) Cement mixers.
(F) Combines.
(G) Cranes and derricks.
(H) Delivery trucks with seating only for the driver, or only for
the driver plus a folding jump seat.
(I) Dump trucks (including garbage trucks).
(J) Flatbed trucks.
(K) Forklifts.
(L) Passenger buses used as such with a capacity of at least 20
passengers.
(M) Qualified moving vans (as defined in paragraph (k)(4) of this
section).
(N) Qualified specialized utility repair trucks (as defined in
paragraph (k)(5) of this section).
(O) Refrigerated trucks.
(P) School buses (as defined in section 4221(d)(7)(c)).
(Q) Tractors and other special purpose farm vehicles.
(R) Unmarked vehicles used by law enforcement officers (as defined
in paragraph (k)(6) of this section) if the use is officially
authorized.
(S) Such other vehicles as the Commissioner may designate.
(3) Clearly marked police, fire, or public safety officer vehicles.
A police, fire, or public safety officer vehicle is a vehicle, owned or
leased by a governmental unit, or any agency or instrumentality
thereof, that is required to be used for commuting by a police officer,
fire fighter, or public safety officer (as defined in section
402(l)(4)(C) of this chapter) who, when not on a regular shift, is on
call at all times, provided that any personal use (other than
commuting) of the vehicle outside the limit of the police officer's
arrest powers or the fire fighter's or public safety officer's
obligation to respond to an emergency is prohibited by such
governmental unit. A police, fire, or public safety officer vehicle is
clearly marked if, through painted insignia or words, it is readily
apparent that the vehicle is a police, fire, or public safety officer
vehicle. A marking on a license plate is not a clear marking for
purposes of this paragraph (k).
(4) Qualified moving van. The term qualified moving van means any
truck or van used by a professional moving company in the trade or
business of moving household or business goods if--
(i) No personal use of the van is allowed other than for travel to
and from a move site (or for de minimis personal use, such as a stop
for lunch on the way between two move sites);
(ii) Personal use for travel to and from a move site is an
irregular practice (that is, not more than five times a month on
average); and
(iii) Personal use is limited to situations in which it is more
convenient to the employer, because of the location of the employee's
residence in relation to the location of the move site, for the van not
to be returned to the employer's business location.
(5) Qualified specialized utility repair truck. The term qualified
specialized utility repair truck means any truck (not including a van
or pickup truck)
[[Page 27937]]
specifically designed and used to carry heavy tools, testing equipment,
or parts if--
(i) The shelves, racks, or other permanent interior construction
which has been installed to carry and store such heavy items is such
that it is unlikely that the truck will be used more than a de minimis
amount for personal purposes; and
(ii) The employer requires the employee to drive the truck home in
order to be able to respond in emergency situations for purposes of
restoring or maintaining electricity, gas, telephone, water, sewer, or
steam utility services.
(6) Unmarked law enforcement vehicles--(i) In general. The
substantiation requirements of section 274(d) and this section do not
apply to officially authorized uses of an unmarked vehicle by a ``law
enforcement officer''. To qualify for this exception, any personal use
must be authorized by the Federal, State, county, or local governmental
agency or department that owns or leases the vehicle and employs the
officer, and must be incident to law-enforcement functions, such as
being able to report directly from home to a stakeout or surveillance
site, or to an emergency situation. Use of an unmarked vehicle for
vacation or recreation trips cannot qualify as an authorized use.
(ii) Law enforcement officer. The term law enforcement officer
means an individual who is employed on a full-time basis by a
governmental unit that is responsible for the prevention or
investigation of crime involving injury to persons or property
(including apprehension or detention of persons for such crimes), who
is authorized by law to carry firearms, execute search warrants, and to
make arrests (other than merely a citizen's arrest), and who regularly
carries firearms (except when it is not possible to do so because of
the requirements of undercover work). The term ``law enforcement
officer'' may include an arson investigator if the investigator
otherwise meets the requirements of this paragraph (k)(6)(ii), but does
not include Internal Revenue Service special agents.
(7) Trucks and vans. The substantiation requirements of section
274(d) and this section apply generally to any pickup truck or van,
unless the truck or van has been specially modified with the result
that it is not likely to be used more than a de minimis amount for
personal purposes. For example, a van that has only a front bench for
seating, in which permanent shelving that fills most of the cargo area
has been installed, that constantly carries merchandise or equipment,
and that has been specially painted with advertising or the company's
name, is a vehicle not likely to be used more than a de minimis amount
for personal purposes.
(8) Examples. The following examples illustrate the provisions of
paragraph (k)(3) and (6) of this section:
Example 1. Detective C, who is a ``law enforcement officer''
employed by a state police department, headquartered in City M, is
provided with an unmarked vehicle (equipped with radio
communication) for use during off-duty hours because C must be able
to communicate with headquarters and be available for duty at any
time (for example, to report to a surveillance or crime site). The
police department generally has officially authorized personal use
of the vehicle by C but has prohibited use of the vehicle for
recreational purposes or for personal purposes outside the state.
Thus, C's use of the vehicle for commuting between headquarters or a
surveillance site and home and for personal errands is authorized
personal use as described in paragraph (k)(6)(i) of this section.
With respect to these authorized uses the vehicle is not subject to
the substantiation requirements of section 274(d) and the value of
these uses is not included in C's gross income.
Example 2. Detective T is a ``law enforcement officer''
employed by City M. T is authorized to make arrests only within M's
city limits. T, along with all other officers of the force, is
ordinarily on duty for eight hours each work day and on call during
the other sixteen hours. T is provided with the use of a clearly
marked police vehicle in which T is required to commute to his home
in City M. The police department's official policy regarding marked
police vehicles prohibits its personal use (other than commuting) of
the vehicles outside the city limits. When not using the vehicle on
the job, T uses the vehicle only for commuting, personal errands on
the way between work and home, and personal errands within City M.
All use of the vehicle by T conforms to the requirements of
paragraph (k)(3) of this section. Therefore, the value of that use
is excluded from T's gross income as a working condition fringe and
the vehicle is not subject to the substantiation requirements of
section 274(d).
Example 3. Director C is employed by City M as the director of
the City's rescue squad and is provided with a vehicle for use in
responding to emergencies. Director C is trained in rescue activity
and has the legal authority and legal responsibility to engage in
rescue activity. The city's rescue squad is not a part of City M's
police or fire departments. The director's vehicle is a sedan which
is painted with insignia and words identifying the vehicle as being
owned by the City's rescue squad. C, when not on a regular shift, is
on call at all times. The City's official policy regarding clearly
marked public safety officer vehicles prohibits personal use (other
than for commuting) of the vehicle outside of the limits of the
public safety officer's obligation to respond to an emergency. When
not using the vehicle to respond to emergencies, City M authorizes C
to use the vehicle only for commuting, personal errands on the way
between work and home, and personal errands within the limits of C's
obligation to respond to emergencies. With respect to these
authorized uses, the vehicle is not subject to the substantiation
requirements of section 274(d) and the value of these uses is not
includable in C's gross income.
Example 4. Coroner D is employed by County N to investigate and
determine the cause, time, and manner of certain deaths occurring in
the County. Coroner D also safeguards the property of the deceased,
notifies the next of kin, conducts inquests, and arranges for the
burial of indigent persons. D is provided with a vehicle for use by
County N. The vehicle is to be used in County N business and for
commuting. Personal use other than for commuting purposes is
forbidden. D is trained in rescue activity but has no legal
authority or legal responsibility to engage in rescue activity. D's
vehicle is a sedan which is painted with insignia and words
identifying it as a County N vehicle. D, when not on a regular
shift, is on call at all times. D does not satisfy the criteria of a
public safety officer under 28 CFR 32.3 (2008). Thus, D's vehicle
cannot qualify as a clearly marked public safety officer vehicle.
Accordingly, business use of the vehicle is subject to the
substantiation requirements of section 274(d), and the value of any
personal use of the vehicle, such as commuting, is includable in D's
gross income.
(l) Definitions. For purposes of section 274(d) and this section,
the terms automobile and vehicle have the same meanings as prescribed
in Sec. 1.61-21(d)(1)(ii) and (e)(2), respectively. Also, for purposes
of section 274(d) and this section, the terms employer, employee and
personal use have the same meanings as prescribed in Sec. 1.274-6T(e).
(m) * * * However, paragraph (j)(3) of this section applies to
expenses paid or incurred after September 30, 2002, and paragraph (k)
applies to clearly marked public safety officer vehicles, as defined in
Sec. 1.274-5(k)(3), only with respect to uses occurring after May 19,
2010.
0
Par. 4. Section 1.274-5T is amended by revising paragraphs (k) and (l)
to read as follows:
Sec. 1.274-5T Substantiation requirements (temporary).
* * * * *
(k) and (l) [Reserved]. For further guidance, see Sec. 1.274-5(k)
and (l).
* * * * *
0
Par. 5. Section 1.280F-6 is amended by revising paragraph (b)(2)(ii) to
read as follows:
Sec. 1.280F-6 Special rules and definitions.
* * * * *
(b) * * *
(2) * * *
(ii) Exception. The term ``listed property'' does not include any
vehicle
[[Page 27938]]
that is a qualified nonpersonal use vehicle as defined in section
274(i) and Sec. 1.274-5(k).
* * * * *
Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
Approved: May 5, 2010.
Michael Mundaca,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2010-11767 Filed 5-18-10; 8:45 am]
BILLING CODE 4830-01-P
