Dividend Equivalents From Sources Within the United States, 53141 [2012-21497]

Download as PDF 53141 Rules and Regulations Federal Register Vol. 77, No. 170 Friday, August 31, 2012 [TD 9572] pursuant to a specified notional principal contract (specified NPC) that is contingent upon or determined by reference to a U.S. source dividend. Section 871(m)(3)(A) provides a definition for the term specified NPC that is applicable to payments made through March 18, 2012. Section 1.871– 16T(b) of the Temporary Regulations provides that the definition of specified NPC contained in paragraphs (i) through (iv) of section 871(m)(3)(A) will apply to payments made after March 18, 2012, and before January 1, 2013. The Proposed Regulations provide a different definition of specified NPC that would apply to payments made on or after January 1, 2013. RIN 1545–BK53 Explanation of Provisions Dividend Equivalents From Sources Within the United States Treasury and the IRS received numerous comments on the Proposed Regulations, stating that the proposed effective date of January 1, 2013, would not allow taxpayers sufficient time to build and test the systems required to implement the withholding rules for specified NPCs and equity-linked instruments. In response to these comments, this document amends § 1.871–16T(b) of the Temporary Regulations so that the definition of a specified NPC contained in paragraphs (i) through (iv) of section 871(m)(3)(A) will apply to payments made after March 18, 2012, and before January 1, 2014. When final regulations are issued adopting the Proposed Regulations, Treasury and the IRS intend that the rules contained in the final regulations will apply to payments made on or after January 1, 2014. Treasury and the IRS continue to consider the other public comments made on the Temporary Regulations and the Proposed Regulations. This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. Prices of new books are listed in the first FEDERAL REGISTER issue of each week. DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 1 Internal Revenue Service (IRS), Treasury. ACTION: Temporary regulations; correcting amendment. AGENCY: This document amends temporary regulations relating to dividend equivalents for purposes of section 871(m) of the Internal Revenue Code (Code). The regulations affect nonresident aliens and foreign corporations that hold notional principal contracts (NPCs) providing for payments determined by reference to payments of dividends from sources within the United States. DATES: Effective Date: These regulations are effective August 31, 2012. Applicability Date: For dates of applicability, see § 1.871–16T(g). FOR FURTHER INFORMATION CONTACT: Mark E. Erwin or D. Peter Merkel at (202) 622–3870 (not a toll-free number). SUPPLEMENTARY INFORMATION: SUMMARY: EMCDONALD on DSK67QTVN1PROD with RULES Background On January 23, 2012, the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) published in the Federal Register a temporary regulation and a notice of proposed rulemaking relating to dividend equivalents from sources within the United States. See TD 9572, 77 FR 3108 (Temporary Regulations); REG–120282–10, 77 FR 3202 (Proposed Regulations). Section 871(m)(2) defines the term ‘‘dividend equivalent’’ to include, in part, any payment made VerDate Mar<15>2010 10:37 Aug 30, 2012 Jkt 226001 Drafting Information The principal author of these regulations is D. Peter Merkel, the Office of Associate Chief Counsel (International). Other personnel from Treasury and the IRS participated in their development. List of Subjects in 26 CFR Part 1 Income taxes, Reporting and recordkeeping requirements. Amendments to the Regulations Accordingly, 26 CFR part 1 is amended as follows: PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 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 * * * Section 1.871–16T also issued under 26 U.S.C. 871(m). § 1.871–16T(b) [Amended] Par. 2. Section 1.871–16T(b) is amended by removing the language ‘‘2013’’ and adding the language ‘‘2014’’ in its place wherever it appears. ■ Steven T. Miller, Deputy Commissioner for Services and Enforcement. Approved: August 16, 2012. Mark J. Mazur, Assistant Secretary of the Treasury (Tax Policy). [FR Doc. 2012–21497 Filed 8–30–12; 8:45 am] BILLING CODE 4830–01–P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 117 [Docket No. USCG–2012–0821] Drawbridge Operation Regulation; Columbia River, Vancouver, WA Coast Guard, DHS. Notice of temporary deviation from regulations. AGENCY: ACTION: The Coast Guard has issued a temporary deviation from the operating schedule that governs the Interstate 5 (I– 5) Bridges across the Columbia River, mile 106.5, between Portland, OR and Vancouver, WA. This deviation is necessary to facilitate heavy maintenance on the bridges lift-spans. This deviation allows height-restricted lifts which will reduce the vertical clearance available to vessels transiting beneath the bridges. DATES: This deviation is effective from 7 a.m. on September 15, 2012 through 6 p.m. October 14, 2012. ADDRESSES: Documents mentioned in this preamble as being available in the docket are part of docket USCG–2012– 0821 and are available online by going to https://www.regulations.gov, inserting USCG–2012–0821 in the ‘‘Keyword’’ SUMMARY: E:\FR\FM\31AUR1.SGM 31AUR1

Agencies

[Federal Register Volume 77, Number 170 (Friday, August 31, 2012)]
[Rules and Regulations]
[Page 53141]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-21497]



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Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 
Prices of new books are listed in the first FEDERAL REGISTER issue of each 
week.

========================================================================


Federal Register / Vol. 77, No. 170 / Friday, August 31, 2012 / Rules 
and Regulations

[[Page 53141]]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 9572]
RIN 1545-BK53


Dividend Equivalents From Sources Within the United States

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Temporary regulations; correcting amendment.

-----------------------------------------------------------------------

SUMMARY: This document amends temporary regulations relating to 
dividend equivalents for purposes of section 871(m) of the Internal 
Revenue Code (Code). The regulations affect nonresident aliens and 
foreign corporations that hold notional principal contracts (NPCs) 
providing for payments determined by reference to payments of dividends 
from sources within the United States.

DATES: Effective Date: These regulations are effective August 31, 2012.
    Applicability Date: For dates of applicability, see Sec.  1.871-
16T(g).

FOR FURTHER INFORMATION CONTACT: Mark E. Erwin or D. Peter Merkel at 
(202) 622-3870 (not a toll-free number).

SUPPLEMENTARY INFORMATION:

Background

    On January 23, 2012, the Department of the Treasury (Treasury) and 
the Internal Revenue Service (IRS) published in the Federal Register a 
temporary regulation and a notice of proposed rulemaking relating to 
dividend equivalents from sources within the United States. See TD 
9572, 77 FR 3108 (Temporary Regulations); REG-120282-10, 77 FR 3202 
(Proposed Regulations). Section 871(m)(2) defines the term ``dividend 
equivalent'' to include, in part, any payment made pursuant to a 
specified notional principal contract (specified NPC) that is 
contingent upon or determined by reference to a U.S. source dividend. 
Section 871(m)(3)(A) provides a definition for the term specified NPC 
that is applicable to payments made through March 18, 2012. Section 
1.871-16T(b) of the Temporary Regulations provides that the definition 
of specified NPC contained in paragraphs (i) through (iv) of section 
871(m)(3)(A) will apply to payments made after March 18, 2012, and 
before January 1, 2013. The Proposed Regulations provide a different 
definition of specified NPC that would apply to payments made on or 
after January 1, 2013.

Explanation of Provisions

    Treasury and the IRS received numerous comments on the Proposed 
Regulations, stating that the proposed effective date of January 1, 
2013, would not allow taxpayers sufficient time to build and test the 
systems required to implement the withholding rules for specified NPCs 
and equity-linked instruments. In response to these comments, this 
document amends Sec.  1.871-16T(b) of the Temporary Regulations so that 
the definition of a specified NPC contained in paragraphs (i) through 
(iv) of section 871(m)(3)(A) will apply to payments made after March 
18, 2012, and before January 1, 2014. When final regulations are issued 
adopting the Proposed Regulations, Treasury and the IRS intend that the 
rules contained in the final regulations will apply to payments made on 
or after January 1, 2014.
    Treasury and the IRS continue to consider the other public comments 
made on the Temporary Regulations and the Proposed Regulations.

Drafting Information

    The principal author of these regulations is D. Peter Merkel, the 
Office of Associate Chief Counsel (International). Other personnel from 
Treasury and the IRS participated in their development.

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Amendments to the Regulations

    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 * * *
    Section 1.871-16T also issued under 26 U.S.C. 871(m).


Sec.  1.871-16T(b)  [Amended]

0
Par. 2. Section 1.871-16T(b) is amended by removing the language 
``2013'' and adding the language ``2014'' in its place wherever it 
appears.

Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
    Approved: August 16, 2012.
Mark J. Mazur,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2012-21497 Filed 8-30-12; 8:45 am]
BILLING CODE 4830-01-P

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