User Fees Relating to Enrolled Agents and Enrolled Retirement Plan Agents, 58202-58206 [2018-25210]

Download as PDF 58202 Federal Register / Vol. 83, No. 223 / Monday, November 19, 2018 / Proposed Rules technology categories from which Commerce, through an interagency process, seeks to determine whether there are specific emerging technologies that are important to the national security of the United States for which effective controls can be implemented that avoid negatively impacting U.S. leadership in the science, technology, engineering, and manufacturing sectors. Commerce does not seek to expand jurisdiction over technologies that are not currently subject to the EAR, such as ‘‘fundamental research’’ described in § 734.8 of the EAR. For purposes of this ANPRM, Commerce does not seek to alter existing controls on technology already specifically described in the CCL. Such controls would generally continue to be addressed through multilateral regimes or interagency reviews. Foundational Technology Commerce will issue a separate ANPRM regarding identification of foundational technologies that may be important to U.S. national security. Commerce seeks public comment, however, on treating emerging and foundational technologies as separate types of technology. khammond on DSK30JT082PROD with PROPOSAL Representative Technology Categories The representative general categories of technology for which Commerce currently seeks to determine whether there are specific emerging technologies that are essential to the national security of the United States include: (1) Biotechnology, such as: (i) Nanobiology; (ii) Synthetic biology; (iv) Genomic and genetic engineering; or (v) Neurotech. (2) Artificial intelligence (AI) and machine learning technology, such as: (i) Neural networks and deep learning (e.g., brain modelling, time series prediction, classification); (ii) Evolution and genetic computation (e.g., genetic algorithms, genetic programming); (iii) Reinforcement learning; (iv) Computer vision (e.g., object recognition, image understanding); (v) Expert systems (e.g., decision support systems, teaching systems); (vi) Speech and audio processing (e.g., speech recognition and production); (vii) Natural language processing (e.g., machine translation); (viii) Planning (e.g., scheduling, game playing); (ix) Audio and video manipulation technologies (e.g., voice cloning, deepfakes); (x) AI cloud technologies; or VerDate Sep<11>2014 16:52 Nov 16, 2018 Jkt 247001 (xi) AI chipsets. (3) Position, Navigation, and Timing (PNT) technology. (4) Microprocessor technology, such as: (i) Systems-on-Chip (SoC); or (ii) Stacked Memory on Chip. (5) Advanced computing technology, such as: (i) Memory-centric logic. (6) Data analytics technology, such as: (i) Visualization; (ii) Automated analysis algorithms; or (iii) Context-aware computing. (7) Quantum information and sensing technology, such as (i) Quantum computing; (ii) Quantum encryption; or (iii) Quantum sensing. (8) Logistics technology, such as: (i) Mobile electric power; (ii) Modeling and simulation; (iii) Total asset visibility; or (iv) Distribution-based Logistics Systems (DBLS). (9) Additive manufacturing (e.g., 3D printing); (10) Robotics such as: (i) Micro-drone and micro-robotic systems; (ii) Swarming technology; (iii) Self-assembling robots; (iv) Molecular robotics; (v) Robot compliers; or (vi) Smart Dust. (11) Brain-computer interfaces, such as (i) Neural-controlled interfaces; (ii) Mind-machine interfaces; (iii) Direct neural interfaces; or (iv) Brain-machine interfaces. (12) Hypersonics, such as: (i) Flight control algorithms; (ii) Propulsion technologies; (iii) Thermal protection systems; or (iv) Specialized materials (for structures, sensors, etc.). (13) Advanced Materials, such as: (i) Adaptive camouflage; (ii) Functional textiles (e.g., advanced fiber and fabric technology); or (iii) Biomaterials. (14) Advanced surveillance technologies, such as: Faceprint and voiceprint technologies. BIS welcomes comments on: (1) How to define emerging technology to assist identification of such technology in the future; (2) criteria to apply to determine whether there are specific technologies within these general categories that are important to U.S. national security; (3) sources to identify such technologies; (4) other general technology categories that warrant review to identify emerging technology that are important to U.S. national security; (5) the status of development of these technologies in PO 00000 Frm 00012 Fmt 4702 Sfmt 4702 the United States and other countries; (6) the impact specific emerging technology controls would have on U.S. technological leadership; (7) any other approaches to the issue of identifying emerging technologies important to U.S. national security, including the stage of development or maturity level of an emerging technology that would warrant consideration for export control. Comments should be submitted to BIS as described in the ADDRESSES section of this ANPRM by December 19, 2018. This rule was determined to be significant by the Office of Management Budget under Executive Order 12866. Dated: November 14, 2018. Matthew S. Borman, Deputy Assistant Secretary for Export Administration. [FR Doc. 2018–25221 Filed 11–16–18; 8:45 am] BILLING CODE 3510–33–P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 300 [REG–122898–17] RIN 1545–BO38 User Fees Relating to Enrolled Agents and Enrolled Retirement Plan Agents Internal Revenue Service (IRS), Treasury. ACTION: Notice of proposed rulemaking and notice of public hearing. AGENCY: This document contains proposed amendments to the regulations relating to imposing user fees for enrolled agents and enrolled retirement plan agents. The proposed regulations remove the initial enrollment user fee for enrolled retirement plan agents because the IRS no longer offers initial enrollment as an enrolled retirement plan agent. The proposed regulations also increase the amount of the renewal user fee for enrolled retirement plan agents from $30 to $67. In addition, the proposed regulations increase the amount of both the enrollment and renewal user fee for enrolled agents from $30 to $67. The proposed regulations affect individuals who are or apply to become enrolled agents and individuals who are enrolled retirement plan agents. The Independent Offices Appropriations Act of 1952 authorizes charging user fees. DATES: Written or electronic comments must be received by January 18, 2019. Requests to speak and outlines of topics to be discussed at the public hearing SUMMARY: E:\FR\FM\19NOP1.SGM 19NOP1 Federal Register / Vol. 83, No. 223 / Monday, November 19, 2018 / Proposed Rules scheduled for January 24, 2019, at 10 a.m. must be received by January 18, 2019. ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG–122898–17), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG–122898– 17), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue NW, Washington, DC 20224 or sent electronically via the Federal eRulemaking Portal at http:// www.regulations.gov (IRS REG–122898– 17). The public hearing will be held in the Main Auditorium of the Internal Revenue Service Building, 1111 Constitution Avenue NW, Washington, DC. FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, Mark Shurtliff at (202) 317–6845; concerning cost methodology, Michael A. Weber at (202) 803–9738; concerning submission of comments, the public hearing, or to be placed on the building access list to attend the public hearing, Regina Johnson at (202) 317–6901 (not toll-free numbers). SUPPLEMENTARY INFORMATION: khammond on DSK30JT082PROD with PROPOSAL Background and Explanation of Provisions This document contains proposed amendments to 26 CFR part 300 regarding user fees. A. Enrolled Agents and Enrolled Retirement Plan Agents Section 330(a)(1) of title 31 of the United States Code authorizes the Secretary of the Treasury to regulate the practice of representatives before the Treasury Department. Before admitting a representative to practice, the Secretary is authorized to ‘‘require that the representative demonstrate—(A) good character; (B) good reputation; (C) necessary qualifications to enable the representative to provide to persons valuable service; and (D) competency to advise and assist persons in presenting their cases.’’ 31 U.S.C. 330(a)(2). Pursuant to section 330 of title 31, the Secretary has published regulations governing practice before the IRS in 31 CFR part 10 and reprinted the regulations as Treasury Department Circular No. 230 (Circular 230). Section 10.4(a) of Circular 230 authorizes the IRS to grant enrollment as enrolled agents to individuals who demonstrate special competence in tax matters by passing a written examination administered by, or under VerDate Sep<11>2014 16:52 Nov 16, 2018 Jkt 247001 the oversight of, the IRS and who have not engaged in any conduct that would justify suspension or disbarment under Circular 230. Every year, the IRS develops and administers an Enrolled Agent Special Enrollment Examination (EA–SEE) that individuals must pass to become an enrolled agent. Section 10.4(b) of Circular 230 currently authorizes the IRS to grant enrollment as enrolled retirement plan agents to individuals who demonstrate special competence in qualified retirement plan matters by passing a written examination administered by, or under the oversight of, the IRS and who have not engaged in any conduct that would justify suspension or disbarment under Circular 230. Until February 12, 2016, the IRS annually developed and administered an Enrolled Retirement Plan Agent Special Enrollment Examination (ERPA–SEE) that individuals were required to take and pass to become an enrolled retirement plan agent. After February 12, 2016, however, the IRS stopped offering the ERPA–SEE. Individuals who have already passed the ERPA–SEE may maintain their enrollment as enrolled retirement plan agents, but the IRS is not accepting applications to become new Enrolled Retirement Plan Agents. Accordingly, the proposed regulations propose to remove the user fee for the initial enrollment of an enrolled retirement plan agent currently in Treasury Regulation § 300.10. Section 10.4(d) also authorizes the IRS to grant enrollment as an enrolled agent or an enrolled retirement plan agent to a qualifying former IRS employee by virtue of past IRS service and technical experience if the former employee has not engaged in any conduct that would justify suspension or disbarment under the provisions of Circular 230 and meets certain other requirements. Application for enrollment as an enrolled agent based on former employment with the IRS must be made within three years from the date of separation from that employment and does not require passing the EA–SEE. When the IRS discontinued offering the ERPA–SEE necessary for enrollment as an enrolled retirement plan agent for individuals without IRS work experience, effective February 12, 2016, the IRS stopped granting individuals enrollment as enrolled retirement plan agents by virtue of past service and technical experience in the IRS. Once eligible for enrollment as an enrolled agent, whether by examination or former employment with the IRS, an individual must file an application for enrollment with the IRS and currently PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 58203 pay a $30 nonrefundable user fee. To maintain active enrollment and practice before the IRS, an individual who has been enrolled as an enrolled agent or enrolled retirement plan agent must file an application to renew enrollment every three years and currently pay a $30 nonrefundable user fee. 31 CFR 10.6(d). The IRS Return Preparer Office (RPO) is responsible for certain matters related to authority to practice before the IRS, including acting on applications for enrollment and renewal of enrolled agents and for renewal of enrolled retirement plan agents. 31 CFR 10.1. As a condition for enrollment as an enrolled agent, the RPO may conduct a federal tax-compliance check to determine whether an applicant has filed all required tax returns and has no outstanding federal tax debts and a suitability check to determine whether an applicant has engaged in any conduct that would justify suspending or disbarring any practitioner under Circular 230. 31 CFR 10.5(d). As a condition for renewal, enrolled agents and enrolled retirement plan agents must certify completion of the continuing education requirements. 31 CFR 10.6(e). As part of its responsibility for administering the enrollment program, RPO determines whether applicants have met the above requirements. 31 CFR 10.6(j)(1). An applicant who is denied enrollment as an enrolled agent for failure to pass a tax-compliance check may reapply if the applicant becomes current with respect to the applicant’s tax liabilities. 31 CFR 10.5(d)(2). Applicants who fail to meet the continuing education and fee payment requirements receive from RPO a notice that states the basis for RPO’s determination of noncompliance and provides an opportunity to cure the failure. 31 CFR 10.6(j)(1). B. User Fee Authority The Independent Offices Appropriations Act of 1952 (IOAA) (31 U.S.C. 9701) authorizes each agency to promulgate regulations establishing the charge for services the agency provides (user fees). Under the IOAA, these userfee regulations are subject to policies prescribed by the President and shall be as uniform as practicable. Those policies are currently set forth in the Office of Management and Budget (OMB) Circular A–25 (OMB Circular), 58 FR 38142 (July 15, 1993). The IOAA states that the services provided by an agency should be selfsustaining to the extent possible (31 U.S.C. 9701(a)). The OMB Circular states that agencies providing services E:\FR\FM\19NOP1.SGM 19NOP1 58204 Federal Register / Vol. 83, No. 223 / Monday, November 19, 2018 / Proposed Rules khammond on DSK30JT082PROD with PROPOSAL that confer special benefits on identifiable recipients beyond those accruing to the general public must identify those services, determine whether user fees should be assessed for those services, and, if so, establish user fees that recover the full cost of providing those services. As required by the IOAA and the OMB Circular, agencies are to review user fees biennially and update them as necessary to reflect changes in the cost of providing the underlying services. During these biennial reviews, an agency must calculate the full cost of providing each service, taking into account all direct and indirect costs to any part of the U.S. government. The full cost of providing a service includes, but is not limited to, salaries, retirement benefits, rents, utilities, travel, and management costs, as well as an appropriate allocation of overhead and other support costs associated with providing the service. An agency should set the user fee at an amount that recovers the full cost of providing the service unless the agency requests, and the OMB grants, an exception to the full-cost requirement. The OMB may grant exceptions only where the cost of collecting the fees would represent an unduly large part of the fee for the activity, or where any other condition exists that, in the opinion of the agency head, justifies an exception. When the OMB grants an exception, the agency does not collect the full cost of providing the service that confers a special benefit on identifiable recipients rather than the public at large, and the agency therefore must fund the remaining cost of providing the service from other available funding sources. When the OMB grants an exception, the agency, and by extension all taxpayers, subsidize the cost of the service to the recipients who would otherwise be required to pay the full cost of providing the service, as the IOAA and the OMB Circular direct. C. Enrollment and Renewal User Fees for the Enrolled Agent and Renewal User Fee for the Enrolled Retirement Plan Agent As discussed in section A of this preamble, an individual who has been granted enrollment as an enrolled agent or an enrolled retirement plan agent may practice before the IRS. The IRS confers benefits on individuals who are enrolled agents or enrolled retirement plan agents beyond those that accrue to the general public by allowing them to practice before the IRS. Because the ability to practice before the IRS is a special benefit, the IRS charges a user fee to recover the full cost associated VerDate Sep<11>2014 16:52 Nov 16, 2018 Jkt 247001 with administering the program for enrollment and renewal of enrolled agents and renewal of enrolled retirement plan agents. On September 30, 2010, the Treasury Department and the IRS published two final regulations in the Federal Register: final regulations (TD 9501, 75 FR 60309) that required tax return preparers who prepare all or substantially all of a tax return or claim for refund for compensation to obtain a preparer tax identification number (PTIN) and final regulations (TD 9503, 75 FR 60316) that required a user fee to apply for or renew a PTIN. Individuals applying for or renewing a PTIN were to be subject to federal tax-compliance and suitability checks and were required to pay a $50 user fee to obtain or renew a PTIN. All enrolled agents and certain enrolled retirement plan agents were required to obtain a PTIN as a condition of enrollment and renewal of enrollment. TD 9527, 76 FR 32286; Notice 2011–91, 2011–47 I.R.B. 792. On April 19, 2011, the Treasury Department and the IRS published in the Federal Register (76 FR 21805) a final regulation (TD 9523) that reduced the amount of the user fees for the initial enrollment and renewal enrollment for enrolled agents and enrolled retirement plan agents from $125 to $30. Because individuals applying to enroll as an enrolled agent or enrolled retirement plan agent also had to obtain a PTIN, the user fee to enroll or renew enrollment was reduced to reflect that certain review procedures (including federal tax-compliance and suitability checks) would be performed as part of the process to obtain a PTIN. On June 1, 2017, the IRS ceased collecting any user fees related to the PTIN. See Steele v. United States, 260 F.Supp.3d 52 (D. D.C. 2017) (holding that the IRS was authorized to require tax return preparers to obtain PTINs, but was not authorized to charge fees for PTINs). As required by the IOAA and the OMB Circular, the RPO completed its 2017 biennial review of the enrollment and renewal user fees associated with enrolled agents and enrolled retirement plan agents. As discussed in section D of this preamble, during its review the RPO took into account the increase in labor, benefits, and overhead costs incurred in connection with providing services to individuals who enroll or renew enrollment as enrolled agents and enrolled retirement plan agents since the user fee was last changed in 2011. In addition, RPO determined that costs associated with federal tax-compliance checks and suitability checks on enrolled individuals should be PO 00000 Frm 00014 Fmt 4702 Sfmt 4702 recovered as part of the user fee for administering the enrollment and renewal programs. The 2017 biennial review also took into account new costs associated with administering the program for enrolled agents and enrolled retirement plan agents, including the costs of operating a dedicated toll-free helpline in the RPO for enrollment and renewal matters. The RPO determined that the full cost of administering the program for enrolled agents and enrolled retirement plan agents has increased from $30 to $67 per application for enrollment or renewal. The proposed fee complies with the directive in the OMB Circular to recover the full cost of providing a service that confers special benefits on identifiable recipients beyond those accruing to the general public. D. Calculation of User Fees Generally The IRS follows generally accepted accounting principles (GAAP) in calculating the full cost of processing an application for enrollment or renewal. The Federal Accounting Standards Advisory Board (FASAB) is the body that establishes GAAP that apply for federal reporting entities, such as the IRS. FASAB publishes the FASAB Handbook of Accounting Standards and Other Pronouncements, as Amended (Current Handbook), which is available at http://files.fasab.gov/pdffiles/2017_ fasab_handbook.pdf. The Current Handbook includes the Statement of Federal Financial Accounting Standards (SFFAS) No. 4: Managerial Cost Accounting Concepts and Standards for the Federal Government. SFFAS No. 4 establishes internal costing standards under GAAP to accurately measure and manage the full cost of federal programs, and the methodology below is in accordance with SFFAS No. 4. 1. Cost Center Allocation The IRS determines the cost of its services and the activities involved in producing them through a costaccounting system that tracks costs to organizational units. The lowest organizational unit in the IRS’s costaccounting system is called a cost center. Cost centers are usually separate offices that are distinguished by subjectmatter area of responsibility or geographic region. All costs of operating a cost center are recorded in the IRS’s cost-accounting system and allocated to that cost center. The costs allocated to a cost center are the direct costs for the cost center’s activities as well as all indirect costs, including overhead, associated with that cost center. Each cost is recorded in only one cost center. E:\FR\FM\19NOP1.SGM 19NOP1 Federal Register / Vol. 83, No. 223 / Monday, November 19, 2018 / Proposed Rules 2. Determining the per Unit Cost To establish the per-unit cost, the total cost of providing the service is divided by the volume of services provided. 3. Cost Estimation of Direct Labor Not all cost centers are fully devoted to one service for which the IRS charges user fees. Some cost centers work on a number of different services across the IRS. In these cases, the IRS uses various cost-measurement techniques to estimate the cost incurred in those cost centers attributable to the program. These techniques include using various timekeeping systems to measure the time required to accomplish activities, or using information provided by subject-matter experts on the time devoted to a program. Once the IRS has estimated the average time required to accomplish an activity, it multiplies that time estimate by the relevant organizational unit’s average labor and benefits cost per unit of time to determine the labor and benefits cost incurred to provide the service. To determine the full cost, IRS then adds overhead as discussed below. khammond on DSK30JT082PROD with PROPOSAL 4. Overhead Overhead is an indirect cost of operating an organization that cannot be immediately associated with an activity that the organization performs. Overhead includes costs of resources that are jointly or commonly consumed by one or more organizational unit’s activities but are not specifically identifiable to a single activity. These costs can include: • General management and administrative services of sustaining and supporting organizations. • Facilities management and ground maintenance services (security, rent, utilities, and building maintenance). • Procurement and contracting services. • Financial management and accounting services. • Information technology services. • Services to acquire and operate property, plants and equipment. • Publication, reproduction, and graphics and video services. • Research, analytical, and statistical services. • Human resources/personnel services. • Library and legal services. To calculate the overhead allocable to a service, the IRS multiplies a Corporate Overhead rate by the labor and benefits costs determined as discussed previously. The IRS calculates the Corporate Overhead rate annually based VerDate Sep<11>2014 16:52 Nov 16, 2018 Jkt 247001 on cost elements underlying the Statement of Net Cost included in the IRS Annual Financial Statements, which are audited by the Government Accountability Office. The Corporate Overhead rate is the ratio of the sum of the IRS’s indirect labor and benefits costs from the supporting and sustaining organizational units—those that do not interact directly with taxpayers—and all non-labor costs to the IRS’s labor and benefits costs of its organizational units that interact directly with taxpayers. The Corporate Overhead rate of 68.00 percent for costs reviewed during FY 2017 was calculated based on FY 2016 costs (which are assumed to be fixed and reoccurring) as follows: Indirect Labor and Benefits Costs ................. Non-Labor Costs .......... $1,681,373,747 2,879,907,032 Labor, Benefits, and Overhead 58205 4,550,453 Dividing this total cost by the projected population of initial enrollment and renewal applications for fiscal years 2018 through 2020 results in a cost per application of $67 as shown below: Labor, Benefits and Overhead Number of Applications ............ $4,550,453 ÷ 68,343 Cost per Application ................. 67 Taking into account the full amount of these costs, the user fee for enrolled agent enrollment or renewal and enrolled retirement plan agent renewal is proposed to be $67 per application. The IRS does not intend to seek an exception from OMB to the full cost requirement. Special Analyses OIRA has determined that this Total Indirect Costs ...... $4,561,280,779 regulation is significant and subject to Direct Labor and Benefits Costs ................... ÷ 6,708,063,559 review under section 6(b) of Executive Order 12866. Corporate Overhead Pursuant to the Regulatory Flexibility Rate ........................... 68.00% Act (5 U.S.C. chapter 6), it is hereby certified that this regulation will not E. Calculation of User Fee for Enrolled have a significant economic impact on Agent Enrollment and Renewal and a substantial number of small entities. Enrolled Retirement Plan Agent The user fee primarily affects Renewal individuals who are enrolled agents, apply to become enrolled agents, or are The IRS used projections for fiscal enrolled retirement plan agents. Only years 2018 through 2020 to determine the direct costs associated with enrolled individuals, not businesses, can be enrolled agents or enrolled retirement agent enrollment and renewal and plan agents. Thus, any economic impact enrolled retirement plan agent renewal. Direct costs are incurred by the RPO and of the user fee on small entities generally will occur only when an include labor costs for enrollment and enrolled agent or enrolled retirement renewal submission processing; tax plan agent owns a small business or compliance and background checks; continuing education and testing-related when a small business employs enrolled agents or enrolled retirement plan activities; and communications, which agents and reimburses them for their include the new toll-free helpline. renewal fees. The Treasury Department The labor and benefits for the work and IRS estimate that approximately performed related to applications for 22,781 individuals will apply annually enrolled agent enrollment and renewal for enrollment as an enrolled agent, and enrolled retirement plan agent renewal is projected to be $2,708,603 in renewal as an enrolled agent, or renewal as an enrolled retirement plan agent. total over fiscal years 2018 through Due to the relatively small number of 2020. The labor and benefits costs small businesses that employ enrolled include the cost to perform background agents or enrolled retirement plan checks and tax compliance checks, agents, a substantial number of small which are services that were not entities are not likely to be affected. included in the previous $30 user fee. Further, the economic impact on any The number of enrollment and renewal small entities affected would be limited applications is based on the FY2016 to paying the $37 difference in cost numbers adjusted by the anticipated between the $67 user fee and the increase in enrollment. Adding previous $30 user fee (for each enrolled Corporate Overhead expenses to the agent or enrolled retirement plan agent total labor and benefits results in total that a small entity employs and pays costs of $4,550,453 as shown below: for), which is unlikely to present a Labor and Benefits ................... $2,708,603 significant economic impact. The total Corporate Overhead (68%) ...... 1,841,850 economic impact of this regulation is thus approximately $842,897 annually, PO 00000 Frm 00015 Fmt 4702 + Sfmt 4702 E:\FR\FM\19NOP1.SGM 19NOP1 58206 Federal Register / Vol. 83, No. 223 / Monday, November 19, 2018 / Proposed Rules which is the product of the approximately 22,781 individuals and the $37 increase in the fee. Accordingly, the rule is not expected to have a significant economic impact on a substantial number of small entities, and a regulatory flexibility analysis is not required. It is not anticipated that the increase in user fee that is paid every three years and averages to $12.33 per year will negatively affect enrollment, which has historically remained steady as user fee amounts have changed. Pursuant to section 7805(f), this notice of proposed rulemaking has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business. khammond on DSK30JT082PROD with PROPOSAL Comments and Public Hearing Before these proposed amendments to the regulations are adopted as final regulations, consideration will be given to any comments that are submitted timely to the IRS as prescribed in the preamble under the ADDRESSES section. The Treasury Department and the IRS request comments on all aspects of the proposed regulations. All comments submitted will be made available at www.regulations.gov or upon request. A public hearing has been scheduled for January 24, 2019, beginning at 10:00 a.m. in the Main Auditorium of the Internal Revenue Service Building, 1111 Constitution Avenue NW, Washington, DC 20224. Due to building-security procedures, visitors must enter at the Constitution Avenue entrance. All visitors must present photo identification to enter the building. Because of access restrictions, visitors will not be admitted beyond the immediate entrance area more than 30 minutes before the hearing starts. For information about having your name placed on the building access list to attend the hearing, see the FOR FURTHER INFORMATION CONTACT section of this preamble. The rules of § 601.601(a)(3) apply to the hearing. Persons who wish to present oral comments at the hearing must submit written or electronic comments and an outline of the topics to be discussed and the time to be devoted to each topic by January 18, 2019. A period of 10 minutes will be allocated to each person for making comments. An agenda showing the scheduling of the speakers will be prepared after the deadline for receiving outlines has passed. Copies of the agenda will be available free of charge at the hearing. VerDate Sep<11>2014 16:52 Nov 16, 2018 Jkt 247001 Drafting Information The principal author of these regulations is Mark Shurtliff, Office of the Associate Chief Counsel (Procedure and Administration). Other personnel from the Treasury Department and the IRS participated in their development. List of Subjects in 26 CFR Part 300 Reporting and recordkeeping requirements, User fees. Proposed Amendments to the Regulations Accordingly, 26 CFR part 300 is proposed to be amended as follows: PART 300—USER FEES Paragraph. 1. The authority citation for part 300 continues to read as follows: ■ Enrollment of enrolled agent fee. * * * * * (b) Fee. The fee for initially enrolling as an enrolled agent with the IRS is $67. * * * * * (d) Applicability date. This section applies 30 days after the date of publication of a Treasury Decision adopting this rule as a final regulation in the Federal Register. ■ Par. 4. Section 300.6 is amended by revising paragraphs (b) and (d) to read as follows: § 300.6 Renewal of enrollment of enrolled agent fee. * * * * * (b) Fee. The fee for renewal of enrollment as an enrolled agent with the IRS is $67. * * * * * (d) Applicability date. This section applies 30 days after the date of publication of a Treasury Decision adopting this rule as a final regulation in the Federal Register. § 300.10 ■ [Removed] Par. 5. Section 300.10 is removed. § 300.11 [Redesignated as § 300.10 and Amended] Par. 6. Redesignate § 300.11 as § 300.10 and amend newly redesignated § 300.10 by revising paragraphs (b) and (d) to read as follows: ■ PO 00000 * * * * (b) Fee. The fee for renewal of enrollment as an enrolled retirement plan agent with the IRS is $67. * * * * * (d) Applicability date. This section applies 30 days after the date of publication of a Treasury Decision adopting this rule as a final regulation in the Federal Register. §§ 300.12 and 300.13 [Redesignated as §§ 300.11 and 300.12] Par. 7. Redesignate §§ 300.12 and 300.13 as §§ 300.11 and 300.12. ■ Kirsten Wielobob, Deputy Commissioner for Services and Enforcement. [FR Doc. 2018–25210 Filed 11–15–18; 4:15 pm] [Amended] Par. 2. Section 300.0 is amended by removing paragraph (b)(10) and redesignating paragraphs (b)(11) through (13) as paragraphs (b)(10) through (12). ■ Par. 3. Section 300.5 is amended by revising paragraphs (b) and (d) to read as follows: ■ § 300.5 * BILLING CODE 4830–01–P Authority: 31 U.S.C. 9701. § 300.0 § 300.10 Renewal of enrollment of enrolled retirement plan agent fee. Frm 00016 Fmt 4702 Sfmt 4702 ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA–R03–OAR–2017–0730; FRL–9986–63– Region 3] Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Attainment Plan for the Allegheny, Pennsylvania Nonattainment Area for the 2010 Sulfur Dioxide Primary National Ambient Air Quality Standard Environmental Protection Agency (EPA). ACTION: Proposed rule. AGENCY: The Environmental Protection Agency (EPA) is proposing to approve a state implementation plan (SIP) revision, submitted by the Pennsylvania Department of Environmental Protection (PADEP) on behalf of the Allegheny County Health Department (ACHD), to EPA on October 3, 2017, for the purpose of providing for attainment of the 2010 sulfur dioxide (SO2) primary national ambient air quality standard (NAAQS) in the Allegheny, Pennsylvania SO2 nonattainment area (hereafter referred to as the ‘‘Allegheny Area’’ or ‘‘Area’’). The major sources of SO2 in the Allegheny Area are the Harsco Metals facility and the facilities which comprise the U.S. Steel (USS) Mon Valley Works: Clairton, Edgar Thomson and Irvin Plants. The Pennsylvania SIP submission is an attainment plan which includes the base year emissions inventory, an analysis of the reasonably available control technology (RACT) and reasonably available control measure (RACM) SUMMARY: E:\FR\FM\19NOP1.SGM 19NOP1

Agencies

[Federal Register Volume 83, Number 223 (Monday, November 19, 2018)]
[Proposed Rules]
[Pages 58202-58206]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-25210]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 300

[REG-122898-17]
RIN 1545-BO38


User Fees Relating to Enrolled Agents and Enrolled Retirement 
Plan Agents

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking and notice of public hearing.

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SUMMARY: This document contains proposed amendments to the regulations 
relating to imposing user fees for enrolled agents and enrolled 
retirement plan agents. The proposed regulations remove the initial 
enrollment user fee for enrolled retirement plan agents because the IRS 
no longer offers initial enrollment as an enrolled retirement plan 
agent. The proposed regulations also increase the amount of the renewal 
user fee for enrolled retirement plan agents from $30 to $67. In 
addition, the proposed regulations increase the amount of both the 
enrollment and renewal user fee for enrolled agents from $30 to $67. 
The proposed regulations affect individuals who are or apply to become 
enrolled agents and individuals who are enrolled retirement plan 
agents. The Independent Offices Appropriations Act of 1952 authorizes 
charging user fees.

DATES: Written or electronic comments must be received by January 18, 
2019. Requests to speak and outlines of topics to be discussed at the 
public hearing

[[Page 58203]]

scheduled for January 24, 2019, at 10 a.m. must be received by January 
18, 2019.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-122898-17), Room 
5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, 
Washington, DC 20044. Submissions may be hand-delivered Monday through 
Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-
122898-17), Courier's Desk, Internal Revenue Service, 1111 Constitution 
Avenue NW, Washington, DC 20224 or sent electronically via the Federal 
eRulemaking Portal at http://www.regulations.gov (IRS REG-122898-17). 
The public hearing will be held in the Main Auditorium of the Internal 
Revenue Service Building, 1111 Constitution Avenue NW, Washington, DC.

FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, 
Mark Shurtliff at (202) 317-6845; concerning cost methodology, Michael 
A. Weber at (202) 803-9738; concerning submission of comments, the 
public hearing, or to be placed on the building access list to attend 
the public hearing, Regina Johnson at (202) 317-6901 (not toll-free 
numbers).

SUPPLEMENTARY INFORMATION: 

Background and Explanation of Provisions

    This document contains proposed amendments to 26 CFR part 300 
regarding user fees.

A. Enrolled Agents and Enrolled Retirement Plan Agents

    Section 330(a)(1) of title 31 of the United States Code authorizes 
the Secretary of the Treasury to regulate the practice of 
representatives before the Treasury Department. Before admitting a 
representative to practice, the Secretary is authorized to ``require 
that the representative demonstrate--(A) good character; (B) good 
reputation; (C) necessary qualifications to enable the representative 
to provide to persons valuable service; and (D) competency to advise 
and assist persons in presenting their cases.'' 31 U.S.C. 330(a)(2). 
Pursuant to section 330 of title 31, the Secretary has published 
regulations governing practice before the IRS in 31 CFR part 10 and 
reprinted the regulations as Treasury Department Circular No. 230 
(Circular 230).
    Section 10.4(a) of Circular 230 authorizes the IRS to grant 
enrollment as enrolled agents to individuals who demonstrate special 
competence in tax matters by passing a written examination administered 
by, or under the oversight of, the IRS and who have not engaged in any 
conduct that would justify suspension or disbarment under Circular 230. 
Every year, the IRS develops and administers an Enrolled Agent Special 
Enrollment Examination (EA-SEE) that individuals must pass to become an 
enrolled agent.
    Section 10.4(b) of Circular 230 currently authorizes the IRS to 
grant enrollment as enrolled retirement plan agents to individuals who 
demonstrate special competence in qualified retirement plan matters by 
passing a written examination administered by, or under the oversight 
of, the IRS and who have not engaged in any conduct that would justify 
suspension or disbarment under Circular 230. Until February 12, 2016, 
the IRS annually developed and administered an Enrolled Retirement Plan 
Agent Special Enrollment Examination (ERPA-SEE) that individuals were 
required to take and pass to become an enrolled retirement plan agent. 
After February 12, 2016, however, the IRS stopped offering the ERPA-
SEE. Individuals who have already passed the ERPA-SEE may maintain 
their enrollment as enrolled retirement plan agents, but the IRS is not 
accepting applications to become new Enrolled Retirement Plan Agents. 
Accordingly, the proposed regulations propose to remove the user fee 
for the initial enrollment of an enrolled retirement plan agent 
currently in Treasury Regulation Sec.  300.10.
    Section 10.4(d) also authorizes the IRS to grant enrollment as an 
enrolled agent or an enrolled retirement plan agent to a qualifying 
former IRS employee by virtue of past IRS service and technical 
experience if the former employee has not engaged in any conduct that 
would justify suspension or disbarment under the provisions of Circular 
230 and meets certain other requirements. Application for enrollment as 
an enrolled agent based on former employment with the IRS must be made 
within three years from the date of separation from that employment and 
does not require passing the EA-SEE. When the IRS discontinued offering 
the ERPA-SEE necessary for enrollment as an enrolled retirement plan 
agent for individuals without IRS work experience, effective February 
12, 2016, the IRS stopped granting individuals enrollment as enrolled 
retirement plan agents by virtue of past service and technical 
experience in the IRS.
    Once eligible for enrollment as an enrolled agent, whether by 
examination or former employment with the IRS, an individual must file 
an application for enrollment with the IRS and currently pay a $30 
nonrefundable user fee. To maintain active enrollment and practice 
before the IRS, an individual who has been enrolled as an enrolled 
agent or enrolled retirement plan agent must file an application to 
renew enrollment every three years and currently pay a $30 
nonrefundable user fee. 31 CFR 10.6(d).
    The IRS Return Preparer Office (RPO) is responsible for certain 
matters related to authority to practice before the IRS, including 
acting on applications for enrollment and renewal of enrolled agents 
and for renewal of enrolled retirement plan agents. 31 CFR 10.1. As a 
condition for enrollment as an enrolled agent, the RPO may conduct a 
federal tax-compliance check to determine whether an applicant has 
filed all required tax returns and has no outstanding federal tax debts 
and a suitability check to determine whether an applicant has engaged 
in any conduct that would justify suspending or disbarring any 
practitioner under Circular 230. 31 CFR 10.5(d). As a condition for 
renewal, enrolled agents and enrolled retirement plan agents must 
certify completion of the continuing education requirements. 31 CFR 
10.6(e).
    As part of its responsibility for administering the enrollment 
program, RPO determines whether applicants have met the above 
requirements. 31 CFR 10.6(j)(1). An applicant who is denied enrollment 
as an enrolled agent for failure to pass a tax-compliance check may 
reapply if the applicant becomes current with respect to the 
applicant's tax liabilities. 31 CFR 10.5(d)(2). Applicants who fail to 
meet the continuing education and fee payment requirements receive from 
RPO a notice that states the basis for RPO's determination of 
noncompliance and provides an opportunity to cure the failure. 31 CFR 
10.6(j)(1).

B. User Fee Authority

    The Independent Offices Appropriations Act of 1952 (IOAA) (31 
U.S.C. 9701) authorizes each agency to promulgate regulations 
establishing the charge for services the agency provides (user fees). 
Under the IOAA, these user-fee regulations are subject to policies 
prescribed by the President and shall be as uniform as practicable. 
Those policies are currently set forth in the Office of Management and 
Budget (OMB) Circular A-25 (OMB Circular), 58 FR 38142 (July 15, 1993).
    The IOAA states that the services provided by an agency should be 
self-sustaining to the extent possible (31 U.S.C. 9701(a)). The OMB 
Circular states that agencies providing services

[[Page 58204]]

that confer special benefits on identifiable recipients beyond those 
accruing to the general public must identify those services, determine 
whether user fees should be assessed for those services, and, if so, 
establish user fees that recover the full cost of providing those 
services. As required by the IOAA and the OMB Circular, agencies are to 
review user fees biennially and update them as necessary to reflect 
changes in the cost of providing the underlying services. During these 
biennial reviews, an agency must calculate the full cost of providing 
each service, taking into account all direct and indirect costs to any 
part of the U.S. government. The full cost of providing a service 
includes, but is not limited to, salaries, retirement benefits, rents, 
utilities, travel, and management costs, as well as an appropriate 
allocation of overhead and other support costs associated with 
providing the service.
    An agency should set the user fee at an amount that recovers the 
full cost of providing the service unless the agency requests, and the 
OMB grants, an exception to the full-cost requirement. The OMB may 
grant exceptions only where the cost of collecting the fees would 
represent an unduly large part of the fee for the activity, or where 
any other condition exists that, in the opinion of the agency head, 
justifies an exception. When the OMB grants an exception, the agency 
does not collect the full cost of providing the service that confers a 
special benefit on identifiable recipients rather than the public at 
large, and the agency therefore must fund the remaining cost of 
providing the service from other available funding sources. When the 
OMB grants an exception, the agency, and by extension all taxpayers, 
subsidize the cost of the service to the recipients who would otherwise 
be required to pay the full cost of providing the service, as the IOAA 
and the OMB Circular direct.

C. Enrollment and Renewal User Fees for the Enrolled Agent and Renewal 
User Fee for the Enrolled Retirement Plan Agent

    As discussed in section A of this preamble, an individual who has 
been granted enrollment as an enrolled agent or an enrolled retirement 
plan agent may practice before the IRS. The IRS confers benefits on 
individuals who are enrolled agents or enrolled retirement plan agents 
beyond those that accrue to the general public by allowing them to 
practice before the IRS. Because the ability to practice before the IRS 
is a special benefit, the IRS charges a user fee to recover the full 
cost associated with administering the program for enrollment and 
renewal of enrolled agents and renewal of enrolled retirement plan 
agents.
    On September 30, 2010, the Treasury Department and the IRS 
published two final regulations in the Federal Register: final 
regulations (TD 9501, 75 FR 60309) that required tax return preparers 
who prepare all or substantially all of a tax return or claim for 
refund for compensation to obtain a preparer tax identification number 
(PTIN) and final regulations (TD 9503, 75 FR 60316) that required a 
user fee to apply for or renew a PTIN. Individuals applying for or 
renewing a PTIN were to be subject to federal tax-compliance and 
suitability checks and were required to pay a $50 user fee to obtain or 
renew a PTIN. All enrolled agents and certain enrolled retirement plan 
agents were required to obtain a PTIN as a condition of enrollment and 
renewal of enrollment. TD 9527, 76 FR 32286; Notice 2011-91, 2011-47 
I.R.B. 792.
    On April 19, 2011, the Treasury Department and the IRS published in 
the Federal Register (76 FR 21805) a final regulation (TD 9523) that 
reduced the amount of the user fees for the initial enrollment and 
renewal enrollment for enrolled agents and enrolled retirement plan 
agents from $125 to $30. Because individuals applying to enroll as an 
enrolled agent or enrolled retirement plan agent also had to obtain a 
PTIN, the user fee to enroll or renew enrollment was reduced to reflect 
that certain review procedures (including federal tax-compliance and 
suitability checks) would be performed as part of the process to obtain 
a PTIN. On June 1, 2017, the IRS ceased collecting any user fees 
related to the PTIN. See Steele v. United States, 260 F.Supp.3d 52 (D. 
D.C. 2017) (holding that the IRS was authorized to require tax return 
preparers to obtain PTINs, but was not authorized to charge fees for 
PTINs).
    As required by the IOAA and the OMB Circular, the RPO completed its 
2017 biennial review of the enrollment and renewal user fees associated 
with enrolled agents and enrolled retirement plan agents. As discussed 
in section D of this preamble, during its review the RPO took into 
account the increase in labor, benefits, and overhead costs incurred in 
connection with providing services to individuals who enroll or renew 
enrollment as enrolled agents and enrolled retirement plan agents since 
the user fee was last changed in 2011. In addition, RPO determined that 
costs associated with federal tax-compliance checks and suitability 
checks on enrolled individuals should be recovered as part of the user 
fee for administering the enrollment and renewal programs. The 2017 
biennial review also took into account new costs associated with 
administering the program for enrolled agents and enrolled retirement 
plan agents, including the costs of operating a dedicated toll-free 
helpline in the RPO for enrollment and renewal matters. The RPO 
determined that the full cost of administering the program for enrolled 
agents and enrolled retirement plan agents has increased from $30 to 
$67 per application for enrollment or renewal. The proposed fee 
complies with the directive in the OMB Circular to recover the full 
cost of providing a service that confers special benefits on 
identifiable recipients beyond those accruing to the general public.

D. Calculation of User Fees Generally

    The IRS follows generally accepted accounting principles (GAAP) in 
calculating the full cost of processing an application for enrollment 
or renewal. The Federal Accounting Standards Advisory Board (FASAB) is 
the body that establishes GAAP that apply for federal reporting 
entities, such as the IRS. FASAB publishes the FASAB Handbook of 
Accounting Standards and Other Pronouncements, as Amended (Current 
Handbook), which is available at http://files.fasab.gov/pdffiles/2017_fasab_handbook.pdf. The Current Handbook includes the Statement of 
Federal Financial Accounting Standards (SFFAS) No. 4: Managerial Cost 
Accounting Concepts and Standards for the Federal Government. SFFAS No. 
4 establishes internal costing standards under GAAP to accurately 
measure and manage the full cost of federal programs, and the 
methodology below is in accordance with SFFAS No. 4.
1. Cost Center Allocation
    The IRS determines the cost of its services and the activities 
involved in producing them through a cost-accounting system that tracks 
costs to organizational units. The lowest organizational unit in the 
IRS's cost-accounting system is called a cost center. Cost centers are 
usually separate offices that are distinguished by subject-matter area 
of responsibility or geographic region. All costs of operating a cost 
center are recorded in the IRS's cost-accounting system and allocated 
to that cost center. The costs allocated to a cost center are the 
direct costs for the cost center's activities as well as all indirect 
costs, including overhead, associated with that cost center. Each cost 
is recorded in only one cost center.

[[Page 58205]]

2. Determining the per Unit Cost
    To establish the per-unit cost, the total cost of providing the 
service is divided by the volume of services provided.
3. Cost Estimation of Direct Labor
    Not all cost centers are fully devoted to one service for which the 
IRS charges user fees. Some cost centers work on a number of different 
services across the IRS. In these cases, the IRS uses various cost-
measurement techniques to estimate the cost incurred in those cost 
centers attributable to the program. These techniques include using 
various timekeeping systems to measure the time required to accomplish 
activities, or using information provided by subject-matter experts on 
the time devoted to a program. Once the IRS has estimated the average 
time required to accomplish an activity, it multiplies that time 
estimate by the relevant organizational unit's average labor and 
benefits cost per unit of time to determine the labor and benefits cost 
incurred to provide the service. To determine the full cost, IRS then 
adds overhead as discussed below.
4. Overhead
    Overhead is an indirect cost of operating an organization that 
cannot be immediately associated with an activity that the organization 
performs. Overhead includes costs of resources that are jointly or 
commonly consumed by one or more organizational unit's activities but 
are not specifically identifiable to a single activity.
    These costs can include:
     General management and administrative services of 
sustaining and supporting organizations.
     Facilities management and ground maintenance services 
(security, rent, utilities, and building maintenance).
     Procurement and contracting services.
     Financial management and accounting services.
     Information technology services.
     Services to acquire and operate property, plants and 
equipment.
     Publication, reproduction, and graphics and video 
services.
     Research, analytical, and statistical services.
     Human resources/personnel services.
     Library and legal services.
    To calculate the overhead allocable to a service, the IRS 
multiplies a Corporate Overhead rate by the labor and benefits costs 
determined as discussed previously. The IRS calculates the Corporate 
Overhead rate annually based on cost elements underlying the Statement 
of Net Cost included in the IRS Annual Financial Statements, which are 
audited by the Government Accountability Office. The Corporate Overhead 
rate is the ratio of the sum of the IRS's indirect labor and benefits 
costs from the supporting and sustaining organizational units--those 
that do not interact directly with taxpayers--and all non-labor costs 
to the IRS's labor and benefits costs of its organizational units that 
interact directly with taxpayers.
    The Corporate Overhead rate of 68.00 percent for costs reviewed 
during FY 2017 was calculated based on FY 2016 costs (which are assumed 
to be fixed and reoccurring) as follows:

------------------------------------------------------------------------
 
------------------------------------------------------------------------
Indirect Labor and Benefits Costs...................      $1,681,373,747
Non-Labor Costs.....................................     + 2,879,907,032
                                                     -------------------
Total Indirect Costs................................      $4,561,280,779
Direct Labor and Benefits Costs.....................     / 6,708,063,559
                                                     -------------------
Corporate Overhead Rate.............................              68.00%
------------------------------------------------------------------------

E. Calculation of User Fee for Enrolled Agent Enrollment and Renewal 
and Enrolled Retirement Plan Agent Renewal

    The IRS used projections for fiscal years 2018 through 2020 to 
determine the direct costs associated with enrolled agent enrollment 
and renewal and enrolled retirement plan agent renewal. Direct costs 
are incurred by the RPO and include labor costs for enrollment and 
renewal submission processing; tax compliance and background checks; 
continuing education and testing-related activities; and 
communications, which include the new toll-free helpline.
    The labor and benefits for the work performed related to 
applications for enrolled agent enrollment and renewal and enrolled 
retirement plan agent renewal is projected to be $2,708,603 in total 
over fiscal years 2018 through 2020. The labor and benefits costs 
include the cost to perform background checks and tax compliance 
checks, which are services that were not included in the previous $30 
user fee. The number of enrollment and renewal applications is based on 
the FY2016 numbers adjusted by the anticipated increase in enrollment. 
Adding Corporate Overhead expenses to the total labor and benefits 
results in total costs of $4,550,453 as shown below:

------------------------------------------------------------------------
 
------------------------------------------------------------------------
Labor and Benefits.........................................   $2,708,603
Corporate Overhead (68%)...................................    1,841,850
                                                            ------------
Labor, Benefits, and Overhead..............................    4,550,453
------------------------------------------------------------------------

    Dividing this total cost by the projected population of initial 
enrollment and renewal applications for fiscal years 2018 through 2020 
results in a cost per application of $67 as shown below:

------------------------------------------------------------------------
 
------------------------------------------------------------------------
Labor, Benefits and Overhead...............................   $4,550,453
Number of Applications.....................................     / 68,343
                                                            ------------
Cost per Application.......................................           67
------------------------------------------------------------------------

    Taking into account the full amount of these costs, the user fee 
for enrolled agent enrollment or renewal and enrolled retirement plan 
agent renewal is proposed to be $67 per application. The IRS does not 
intend to seek an exception from OMB to the full cost requirement.

Special Analyses

    OIRA has determined that this regulation is significant and subject 
to review under section 6(b) of Executive Order 12866.
    Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it 
is hereby certified that this regulation will not have a significant 
economic impact on a substantial number of small entities. The user fee 
primarily affects individuals who are enrolled agents, apply to become 
enrolled agents, or are enrolled retirement plan agents. Only 
individuals, not businesses, can be enrolled agents or enrolled 
retirement plan agents. Thus, any economic impact of the user fee on 
small entities generally will occur only when an enrolled agent or 
enrolled retirement plan agent owns a small business or when a small 
business employs enrolled agents or enrolled retirement plan agents and 
reimburses them for their renewal fees. The Treasury Department and IRS 
estimate that approximately 22,781 individuals will apply annually for 
enrollment as an enrolled agent, renewal as an enrolled agent, or 
renewal as an enrolled retirement plan agent. Due to the relatively 
small number of small businesses that employ enrolled agents or 
enrolled retirement plan agents, a substantial number of small entities 
are not likely to be affected. Further, the economic impact on any 
small entities affected would be limited to paying the $37 difference 
in cost between the $67 user fee and the previous $30 user fee (for 
each enrolled agent or enrolled retirement plan agent that a small 
entity employs and pays for), which is unlikely to present a 
significant economic impact. The total economic impact of this 
regulation is thus approximately $842,897 annually,

[[Page 58206]]

which is the product of the approximately 22,781 individuals and the 
$37 increase in the fee. Accordingly, the rule is not expected to have 
a significant economic impact on a substantial number of small 
entities, and a regulatory flexibility analysis is not required.
    It is not anticipated that the increase in user fee that is paid 
every three years and averages to $12.33 per year will negatively 
affect enrollment, which has historically remained steady as user fee 
amounts have changed. Pursuant to section 7805(f), this notice of 
proposed rulemaking has been submitted to the Chief Counsel for 
Advocacy of the Small Business Administration for comment on its impact 
on small business.

Comments and Public Hearing

    Before these proposed amendments to the regulations are adopted as 
final regulations, consideration will be given to any comments that are 
submitted timely to the IRS as prescribed in the preamble under the 
ADDRESSES section. The Treasury Department and the IRS request comments 
on all aspects of the proposed regulations. All comments submitted will 
be made available at www.regulations.gov or upon request.
    A public hearing has been scheduled for January 24, 2019, beginning 
at 10:00 a.m. in the Main Auditorium of the Internal Revenue Service 
Building, 1111 Constitution Avenue NW, Washington, DC 20224. Due to 
building-security procedures, visitors must enter at the Constitution 
Avenue entrance. All visitors must present photo identification to 
enter the building. Because of access restrictions, visitors will not 
be admitted beyond the immediate entrance area more than 30 minutes 
before the hearing starts. For information about having your name 
placed on the building access list to attend the hearing, see the FOR 
FURTHER INFORMATION CONTACT section of this preamble.
    The rules of Sec.  601.601(a)(3) apply to the hearing. Persons who 
wish to present oral comments at the hearing must submit written or 
electronic comments and an outline of the topics to be discussed and 
the time to be devoted to each topic by January 18, 2019. A period of 
10 minutes will be allocated to each person for making comments. An 
agenda showing the scheduling of the speakers will be prepared after 
the deadline for receiving outlines has passed. Copies of the agenda 
will be available free of charge at the hearing.

Drafting Information

    The principal author of these regulations is Mark Shurtliff, Office 
of the Associate Chief Counsel (Procedure and Administration). Other 
personnel from the Treasury Department and the IRS participated in 
their development.

List of Subjects in 26 CFR Part 300

    Reporting and recordkeeping requirements, User fees.

Proposed Amendments to the Regulations

    Accordingly, 26 CFR part 300 is proposed to be amended as follows:

PART 300--USER FEES

0
Paragraph. 1. The authority citation for part 300 continues to read as 
follows:

    Authority: 31 U.S.C. 9701.


Sec.  300.0   [Amended]

0
Par. 2. Section 300.0 is amended by removing paragraph (b)(10) and 
redesignating paragraphs (b)(11) through (13) as paragraphs (b)(10) 
through (12).
0
Par. 3. Section 300.5 is amended by revising paragraphs (b) and (d) to 
read as follows:


Sec.  300.5   Enrollment of enrolled agent fee.

* * * * *
    (b) Fee. The fee for initially enrolling as an enrolled agent with 
the IRS is $67.
* * * * *
    (d) Applicability date. This section applies 30 days after the date 
of publication of a Treasury Decision adopting this rule as a final 
regulation in the Federal Register.
0
Par. 4. Section 300.6 is amended by revising paragraphs (b) and (d) to 
read as follows:


Sec.  300.6  Renewal of enrollment of enrolled agent fee.

* * * * *
    (b) Fee. The fee for renewal of enrollment as an enrolled agent 
with the IRS is $67.
* * * * *
    (d) Applicability date. This section applies 30 days after the date 
of publication of a Treasury Decision adopting this rule as a final 
regulation in the Federal Register.


Sec.  300.10  [Removed]

0
Par. 5. Section 300.10 is removed.


Sec.  300.11  [Redesignated as Sec.  300.10 and Amended]

0
Par. 6. Redesignate Sec.  300.11 as Sec.  300.10 and amend newly 
redesignated Sec.  300.10 by revising paragraphs (b) and (d) to read as 
follows:


Sec.  300.10   Renewal of enrollment of enrolled retirement plan agent 
fee.

* * * * *
    (b) Fee. The fee for renewal of enrollment as an enrolled 
retirement plan agent with the IRS is $67.
* * * * *
    (d) Applicability date. This section applies 30 days after the date 
of publication of a Treasury Decision adopting this rule as a final 
regulation in the Federal Register.


Sec. Sec.  300.12 and 300.13   [Redesignated as Sec. Sec.  300.11 and 
300.12]

0
Par. 7. Redesignate Sec. Sec.  300.12 and 300.13 as Sec. Sec.  300.11 
and 300.12.

Kirsten Wielobob,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 2018-25210 Filed 11-15-18; 4:15 pm]
 BILLING CODE 4830-01-P