Net Investment Income Tax; Correction, 10055-10056 [2014-03763]

Download as PDF Federal Register / Vol. 79, No. 36 / Monday, February 24, 2014 / Proposed Rules distribution would not be subject to tax pursuant to section 871 or 881, or withholding under chapter 3 or 4, if the long party owned the underlying security referenced by the section 871(m) transaction.’’. 8. On page 73137, third column, the first sentence of paragraph (e) should read ‘‘With respect to payments made on or after January 1, 2016, a specified ELI is any ELI acquired by the long party on or after March 5, 2014, that has a delta of 0.70 or greater with respect to an underlying security at the time that the long party acquires the ELI.’’. 9. On page 73141, first column, paragraph (l)(6) Example 3. (ii) should read ‘‘FI’s purchased call option has an initial delta of 0.75 and therefore is a specified ELI and a section 871(m) transaction. FI’s purchased call option and sold put option reference the same underlying security. Because FI sold the put option referencing Stock X to adjust FI’s economic position associated with the call option referencing Stock X, these options are entered into in connection with each other and treated as a combined transaction under paragraph (l)(1) of this section. Because the delta of the combined transaction is tested on the date that FI entered into the additional transaction, the delta of the combined purchased call option and sold put option is 0.60 (0.35 + 0.25). The combined transaction is not a specified ELI; however, the purchased call option remains a specified ELI.’’. § 1.1441–1 [Corrected] sroberts on DSK5SPTVN1PROD with PROPOSALS 10. On page 73142, third column, paragraph (b)(4)(xxiii) should read ‘‘If a potential section 871(m) transaction is only a section 871(m) transaction as a result of applying § 1.871–15(l) (combined transactions) and the withholding agent did not know that the long party (or a related person) entered into the potential section 871(m) transaction in connection with any other potential section 871(m) transaction, the potential section 871(m) transaction is exempt from withholding under section 1441(a).’’. Martin V. Franks, Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel (Procedure and Administration). [FR Doc. 2014–03767 Filed 2–21–14; 8:45 am] BILLING CODE 4830–01–P VerDate Mar<15>2010 16:44 Feb 21, 2014 Jkt 232001 DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 1 [REG–130843–13] RIN 1545–BL74 Net Investment Income Tax; Correction Internal Revenue Service (IRS), Treasury. ACTION: Correction to a withdrawal of notice of proposed rulemaking and notice of proposed rulemaking. AGENCY: This document contains corrections to a withdrawal of notice of proposed rulemaking and notice of proposed rulemaking (REG–130843–13) that was published in the Federal Register on Monday, December 2, 2013, providing guidance on the computation of net investment income. DATES: Written or electronic comments and requests for a public hearing for the notice of proposed rulemaking published at 78 FR 72451, December 2, 2013 are still being accepted and must be received by March 3, 2014. FOR FURTHER INFORMATION CONTACT: Adrienne M. Mikolashek at (202) 317– 6852 (not a toll free number). SUPPLEMENTARY INFORMATION: SUMMARY: Background The withdrawal of notice of proposed rulemaking and notice of proposed rulemaking (REG–130843–13) that is the subject of these corrections is under section 1411 of the Internal Revenue Code. Need for Correction As published, withdrawal of notice of proposed rulemaking and notice of proposed rulemaking (REG–130843–13) contains errors that may prove to be misleading and are in need of clarification. Correction of Publication Accordingly, withdrawal of notice of proposed rulemaking and notice of proposed rulemaking (REG–130843–13) that was the subject of FR Doc. 2013– 28409, is corrected as follows: 1. On page 72456, in the preamble, first column, twenty-first line from the top of the page, the language ‘‘taken income account in computing net’’ is corrected to read ‘‘taken into account in computing net’’. 2. On page 72456, in the preamble, third column, under the paragraph heading ‘‘B. Section 1291 Funds’’, first line, the language ‘‘The Final 2013 Regulations also’’ is corrected to read ‘‘The 2013 Final Regulations also’’. PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 10055 3. On page 72457, in the preamble, first column, sixth line of the second full paragraph, the language ‘‘chapter 1 under section 953(d) and’’ is corrected to read ‘‘chapter 1 under sections 953(d) and’’. 4. On page 72457, in the preamble, second column, tenth line of the first full paragraph, the language ‘‘calculation rules for CFC QEFs, and’’ is corrected to read ‘‘calculation rules for CFCs, QEFs, and’’. 5. On page 72460, in the preamble, first column, second line from the top of the page, the language ‘‘2T(e)(3)(ii)(B)(1)(i) requires the taxpayer’’ is corrected to read ‘‘2T(e)(3)(ii)(B)(1)(i) requires the taxpayer’’. 6. On page 72460, in the preamble, first column, sixth line of the second full paragraph, the language ‘‘469 do not apply for purposes of these’’ is corrected to read ‘‘section 469 do not apply for purposes of these’’. 7. On page 72461, in the preamble, second column, twelfth line from the top of the page, the language ‘‘through is appropriate’’ is corrected to read ‘‘is appropriate’’. 8. On page 72461, in the preamble, third column, under the paragraph heading ‘‘G. Information Reporting’’, fifth line, the language ‘‘commentators expressed concern that’’ is corrected to read ‘‘commentators expressed concern that the’’. § 1.1411–4 [Corrected] 9. On Page 72470, first column, the paragraph heading for (g)(11)(ii)(B) Example 1. should read ‘‘Example 1. Distributive share for unrealized receivables.’’ 10. On page 72470, first column, the first and second sentences of paragraph (g)(11)(ii)(B) Example 1. (i), should read ‘‘A retires from PRS, a business entity classified as a partnership for Federal Income tax purposes for which capital is not a material income producing factor. A is entitled, pursuant to the partnership agreement, to receive 10% of PRS’s net income for 60 months commencing immediately following A’s retirement in exchange for A’s fair market value share of PRS’s unrealized receivables.’’. 11. On page 72470, first column, the fifth sentence of paragraph (g)(11)(ii)(B) Example 1. (i), should read ‘‘Prior to A’s retirement, A materially participated as a general partner in PRS’s trade or business within the meaning of § 1.469– 5T.’’. § 1.1411–7 [Corrected] 12. On page 72473, second column, the first sentence of paragraph (c)(4), E:\FR\FM\24FEP1.SGM 24FEP1 sroberts on DSK5SPTVN1PROD with PROPOSALS 10056 Federal Register / Vol. 79, No. 36 / Monday, February 24, 2014 / Proposed Rules should read ‘‘The amount of net gain or loss from the transferor’s Section 1411(c)(4) Disposition that is includable in § 1.1411–4(a)(1)(iii) is determined by multiplying the transferor’s chapter 1 gain or loss on the disposition by a fraction, the numerator of which is the sum of income, gain, loss, and deduction items (with any separately stated loss and deduction items netted as negative numbers) of a type that are taken into account in the calculation of net investment income (as defined in § 1.1411–1(d)) that are allocated to the transferor during the Section 1411 Holding Period and the denominator of which is the sum of all items of income, gain, loss, and deduction allocated to the transferor during the Section 1411 Holding Period (with any separately stated loss and deduction items netted as negative numbers).’’. 13. On page 72473, third column, the second and the third sentence of paragraph (c)(5) Example 1. (ii), should read ‘‘The total amount of A’s allocated net items during the Section 1411 Holding Period equals $1,830,000 ($1,800,000 income from activity X, $10,000 loss from activity Y, and $20,000 income from marketable securities). Thus, less than 5% ($30,000/ 1,830,000) of A’s allocations during the Section 1411 Holding Period are of a type that are taken into account in the computation of net investment income, and because A’s chapter 1 gain recognized of $900,000 is less than $5,000,000, A qualifies under § 1.1411– 7(c)(2)(ii) to use the optional simplified method.’’. 14. On page 72474, first column, the second sentence of paragraph (c)(5) Example 2., should read ‘‘Under paragraph (c)(4) of this section, A’s percentage of Section 1411 Property is determined by dividing A’s allocable share of income and loss of a type that are taken into account in the calculation of a net investment income (as defined in § 1.1411–1(d)) that are allocated to the transferor by the Passthrough Entity during the Section 1411 Holding Period is $10,000 ($10,000 loss from Y + $20,000 income from marketable securities) by $1,810,000, which is the sum of A’s share of income and loss from all of P’s activates ($1,800,000 + ($10,000) + 20,000).’’ Martin V. Franks, Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel, (Procedure and Administration). [FR Doc. 2014–03763 Filed 2–21–14; 8:45 am] BILLING CODE 4830–01–P VerDate Mar<15>2010 16:44 Feb 21, 2014 Jkt 232001 DEPARTMENT OF THE INTERIOR Bureau of Ocean Energy Management 30 CFR Part 553 [Docket ID: BOEM–2012–0076; MMAA104000] RIN 1010–AD87 Consumer Price Index Adjustments of the Oil Pollution Act of 1990 Limit of Liability for Offshore Facilities Bureau of Ocean Energy Management, Interior. ACTION: Proposed rule. AGENCY: The Bureau of Ocean Energy Management (BOEM) is proposing to add a new subpart to its regulations on Oil Spill Financial Responsibility (OSFR) for Offshore Facilities designed to increase the limit of liability for damages applicable to offshore facilities under the Oil Pollution Act of 1990 (OPA), to reflect significant increases in the Consumer Price Index (CPI) since 1990, and to establish a methodology BOEM would use to periodically adjust for inflation the OPA offshore facility limit of liability. BOEM proposes to increase the limit of liability for damages from $75 million to $133.65 million. OPA requires inflation adjustments to the offshore facility limit of liability not less than every three years to preserve the deterrent effect and ‘‘polluter pays’’ principle embodied in the OPA Title I liability and compensation provisions. In addition, the Department of the Interior has determined that this change would further protect the environment by ensuring that any party that causes an oil spill would pay an increased amount of any potential damages. BOEM is publishing this update to its regulations and is soliciting public comments on the method of updates, the clarity of the rule and any other pertinent matters. The Department is limiting the rulemaking comment period to 30 days since it does not anticipate receiving adverse comments on this rulemaking. DATES: Submit comments by March 26, 2014. ADDRESSES: You may submit comments on the rulemaking by any of the following methods. Please use the Regulation Identifier Number (RIN) 1010–AD87 as an identifier in your submission. • Federal eRulemaking Portal: http:// www.regulations.gov. In the entry entitled, ‘‘Enter Keyword or ID,’’ enter BOEM–2012–0076, then click search. Follow the instructions to submit public SUMMARY: PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 comments and view supporting and related materials available for this rulemaking. BOEM will post all comments received during the comment period. • Mail or hand-carry comments to the Department of the Interior; Bureau of Ocean Energy Management; Attention: Peter Meffert, Office of Policy, Regulations and Analysis (OPRA); 381 Elden Street, MS–4001, Herndon, Virginia 20170–4817. Please reference ‘‘Consumer Price Index Adjustments of the Oil Pollution Act of 1990 Limit of Liability for Offshore Facilities’’ in your comments and include your name and return address so that we may contact you if we have questions regarding your submission. • Email comments to the Department of the Interior; Bureau of Ocean Energy Management; Attention: Peter Meffert, Office of Policy, Regulations and Analysis (OPRA) at peter.meffert@ boem.gov. Public availability of comments: • Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so. FOR FURTHER INFORMATION CONTACT: Questions regarding the limit of liability established by this proposed rule, or related to the limits of liability adjustment process, should be directed to Dr. Marshall Rose, Chief, Economics Division, Office of Strategic Resources, Bureau of Ocean Energy Management at 381 Elden Street, MS–4050 Herndon, Virginia 20170–4817 at (703) 787–1538 or email at marshall.rose@boem.gov. SUPPLEMENTARY INFORMATION: Background In general, under Title I of OPA, the responsible parties for any vessel or facility, including any offshore facility, which discharges, or poses a substantial threat of discharge of, oil into or upon United States navigable waters, adjoining shorelines, or the exclusive economic zone, are liable for the OPA removal costs and damages that result from such incident (as specified in 33 U.S.C. 2702(a) and (b)). Under 33 U.S.C. 2704(a), however, the total liability of the responsible parties is limited (with certain exceptions specified in 33 U.S.C. 2704(c)). In instances when the OPA liability limit applies, the Oil Spill E:\FR\FM\24FEP1.SGM 24FEP1

Agencies

[Federal Register Volume 79, Number 36 (Monday, February 24, 2014)]
[Proposed Rules]
[Pages 10055-10056]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-03763]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[REG-130843-13]
RIN 1545-BL74


Net Investment Income Tax; Correction

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Correction to a withdrawal of notice of proposed rulemaking and 
notice of proposed rulemaking.

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

SUMMARY: This document contains corrections to a withdrawal of notice 
of proposed rulemaking and notice of proposed rulemaking (REG-130843-
13) that was published in the Federal Register on Monday, December 2, 
2013, providing guidance on the computation of net investment income.

DATES: Written or electronic comments and requests for a public hearing 
for the notice of proposed rulemaking published at 78 FR 72451, 
December 2, 2013 are still being accepted and must be received by March 
3, 2014.

FOR FURTHER INFORMATION CONTACT: Adrienne M. Mikolashek at (202) 317-
6852 (not a toll free number).

SUPPLEMENTARY INFORMATION:

Background

    The withdrawal of notice of proposed rulemaking and notice of 
proposed rulemaking (REG-130843-13) that is the subject of these 
corrections is under section 1411 of the Internal Revenue Code.

Need for Correction

    As published, withdrawal of notice of proposed rulemaking and 
notice of proposed rulemaking (REG-130843-13) contains errors that may 
prove to be misleading and are in need of clarification.

Correction of Publication

    Accordingly, withdrawal of notice of proposed rulemaking and notice 
of proposed rulemaking (REG-130843-13) that was the subject of FR Doc. 
2013-28409, is corrected as follows:
    1. On page 72456, in the preamble, first column, twenty-first line 
from the top of the page, the language ``taken income account in 
computing net'' is corrected to read ``taken into account in computing 
net''.
    2. On page 72456, in the preamble, third column, under the 
paragraph heading ``B. Section 1291 Funds'', first line, the language 
``The Final 2013 Regulations also'' is corrected to read ``The 2013 
Final Regulations also''.
    3. On page 72457, in the preamble, first column, sixth line of the 
second full paragraph, the language ``chapter 1 under section 953(d) 
and'' is corrected to read ``chapter 1 under sections 953(d) and''.
    4. On page 72457, in the preamble, second column, tenth line of the 
first full paragraph, the language ``calculation rules for CFC QEFs, 
and'' is corrected to read ``calculation rules for CFCs, QEFs, and''.
    5. On page 72460, in the preamble, first column, second line from 
the top of the page, the language ``2T(e)(3)(ii)(B)(1)(i) requires the 
taxpayer'' is corrected to read ``2T(e)(3)(ii)(B)(1)(i) requires the 
taxpayer''.
    6. On page 72460, in the preamble, first column, sixth line of the 
second full paragraph, the language ``469 do not apply for purposes of 
these'' is corrected to read ``section 469 do not apply for purposes of 
these''.
    7. On page 72461, in the preamble, second column, twelfth line from 
the top of the page, the language ``through is appropriate'' is 
corrected to read ``is appropriate''.
    8. On page 72461, in the preamble, third column, under the 
paragraph heading ``G. Information Reporting'', fifth line, the 
language ``commentators expressed concern that'' is corrected to read 
``commentators expressed concern that the''.


Sec.  1.1411-4  [Corrected]

    9. On Page 72470, first column, the paragraph heading for 
(g)(11)(ii)(B) Example 1. should read ``Example 1. Distributive share 
for unrealized receivables.''
    10. On page 72470, first column, the first and second sentences of 
paragraph (g)(11)(ii)(B) Example 1. (i), should read ``A retires from 
PRS, a business entity classified as a partnership for Federal Income 
tax purposes for which capital is not a material income producing 
factor. A is entitled, pursuant to the partnership agreement, to 
receive 10% of PRS's net income for 60 months commencing immediately 
following A's retirement in exchange for A's fair market value share of 
PRS's unrealized receivables.''.
    11. On page 72470, first column, the fifth sentence of paragraph 
(g)(11)(ii)(B) Example 1. (i), should read ``Prior to A's retirement, A 
materially participated as a general partner in PRS's trade or business 
within the meaning of Sec.  1.469-5T.''.


Sec.  1.1411-7  [Corrected]

    12. On page 72473, second column, the first sentence of paragraph 
(c)(4),

[[Page 10056]]

should read ``The amount of net gain or loss from the transferor's 
Section 1411(c)(4) Disposition that is includable in Sec.  1.1411-
4(a)(1)(iii) is determined by multiplying the transferor's chapter 1 
gain or loss on the disposition by a fraction, the numerator of which 
is the sum of income, gain, loss, and deduction items (with any 
separately stated loss and deduction items netted as negative numbers) 
of a type that are taken into account in the calculation of net 
investment income (as defined in Sec.  1.1411-1(d)) that are allocated 
to the transferor during the Section 1411 Holding Period and the 
denominator of which is the sum of all items of income, gain, loss, and 
deduction allocated to the transferor during the Section 1411 Holding 
Period (with any separately stated loss and deduction items netted as 
negative numbers).''.
    13. On page 72473, third column, the second and the third sentence 
of paragraph (c)(5) Example 1. (ii), should read ``The total amount of 
A's allocated net items during the Section 1411 Holding Period equals 
$1,830,000 ($1,800,000 income from activity X, $10,000 loss from 
activity Y, and $20,000 income from marketable securities). Thus, less 
than 5% ($30,000/1,830,000) of A's allocations during the Section 1411 
Holding Period are of a type that are taken into account in the 
computation of net investment income, and because A's chapter 1 gain 
recognized of $900,000 is less than $5,000,000, A qualifies under Sec.  
1.1411-7(c)(2)(ii) to use the optional simplified method.''.
    14. On page 72474, first column, the second sentence of paragraph 
(c)(5) Example 2., should read ``Under paragraph (c)(4) of this 
section, A's percentage of Section 1411 Property is determined by 
dividing A's allocable share of income and loss of a type that are 
taken into account in the calculation of a net investment income (as 
defined in Sec.  1.1411-1(d)) that are allocated to the transferor by 
the Passthrough Entity during the Section 1411 Holding Period is 
$10,000 ($10,000 loss from Y + $20,000 income from marketable 
securities) by $1,810,000, which is the sum of A's share of income and 
loss from all of P's activates ($1,800,000 + ($10,000) + 20,000).''

Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division, 
Associate Chief Counsel, (Procedure and Administration).
[FR Doc. 2014-03763 Filed 2-21-14; 8:45 am]
BILLING CODE 4830-01-P