Qualified Business Income Deduction; Correction, 15954-15955 [2019-07652]
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<![CDATA[
15954
Federal Register / Vol. 84, No. 74 / Wednesday, April 17, 2019 / Rules and Regulations
amozie on DSK9F9SC42PROD with RULES
2017–07, released concurrently with
these final regulations, may also treated
as trades or businesses for purposes of
section 199A.’’ is corrected to read ‘‘A
rental real estate enterprise that meets
the safe harbor described in Notice
2019–07, released concurrently with
these final regulations, may be also be
treated as a trade or business for
purposes of section 199A.’’.
7. On page 2968, second column, in
the preamble, under section ‘‘C.
Aggregation by RPEs’’, the eleventh line
from the bottom of the paragraph, the
language ‘‘4(c)(1).’’ is corrected to read
‘‘4.’’.
8. On page 2969, third column, in the
preamble, the eighth line from the
bottom of the paragraph, the language
‘‘look to the definitions provided for in’’
is corrected to read ‘‘look to the
definitions provided in’’.
9. On page 2969, third column, in the
preamble, the fifteenth line, the
language ‘‘engineering architecture,
accounting,’’ is corrected to read
‘‘engineering, architecture,
accounting,’’.
10. On page 2970, first column, in the
preamble, the second line from the
bottom of the last partial paragraph, the
language ‘‘of the listed fields in section
199(d)(2)’’ is corrected to read ‘‘of the
listed fields in section 199A(d)(2)’’.
11. On page 2976, third column, in
the preamble, the second line under the
paragraph heading ‘‘C. Services or
Property Provided to an SSTB, the
language ‘‘special rules for service or
property’’ is corrected to read ‘‘special
rules for services or property’’.
12. On page 2979, second column, in
the preamble, the second line under the
paragraph heading ‘‘3. ESBTs’’, the
language ‘‘proposed regulation’s
position on’’ is corrected to read
‘‘proposed regulation’s position on an’’.
13. On page 2988, first column, in the
preamble, before the caption ‘‘Drafting
Information’’ is amended by adding
section III. to read as follows:
III. Congressional Review Act
The Administrator of the Office of
Information and Regulatory Affairs of
the Office of Management and Budget
has determined that this is a major rule
for purposes of the Congressional
Review Act (CRA) (5 U.S.C. 801 et seq.)
Under section 801(3) of the CRA, a
major rule takes effect 60 days after the
rule is published in the Federal
Register. Notwithstanding this
requirement, section 808(2) of the CRA
allows agencies to dispense with the
requirements of 801 when the agency
for good cause finds that such procedure
would be impracticable, unnecessary, or
contrary to the public interest and that
VerDate Sep<11>2014
16:23 Apr 16, 2019
Jkt 247001
rule shall take effect at such time as the
agency promulgating the rule
determines.
Pursuant to section 808(2) of the CRA,
the Treasury Department and the IRS
find, for good cause, that a 60-day delay
in the effective date is unnecessary and
contrary to the public interest. Section
199A was enacted on December 22,
2017, and applies to taxable years
beginning after December 31, 2017, and
before January 1, 2026. This means that
the statute is currently effective and that
taxpayers may claim the deduction
when filing their U.S. federal income
tax returns for taxable years ending in
calendar year 2018. The Treasury
Department and the IRS have
determined that the rules in this
Treasury decision are generally
applicable to taxable years ending after
February 8, 2019, the date this Treasury
decision was published in the Federal
Register. Sections 1.199A–1(f), 1.199A–
2(d), 1.199A–3(d), 1.199A–4(e), 1.199A–
5(e), 1.199A–6(e), and 1.643(f)–1(b) are
applicable for taxable years ending after
August 16, 2018, the date that the
proposed regulations were published in
the Federal Register. However,
taxpayers may rely on the rules set forth
in §§ 1.199A–1 through 1.199A–6, in
their entirety, or on the proposed
regulations under §§ 1.199A–1 through
1.199A–6 issued on August 16, 2018, in
their entirety, for taxable years ending
in calendar year 2018. These final
regulations provide crucial guidance for
taxpayers on how to apply the rules of
section 199A, correctly calculate their
deduction under section 199A, and to
accurately file their U.S. federal income
tax returns.
Martin V. Franks,
Chief, Publications and Regulations Branch,
Legal Processing Division, Associate Chief
Counsel (Procedure and Administration).
[FR Doc. 2019–07651 Filed 4–16–19; 8:45 am]
BILLING CODE 4830–01–P
Internal Revenue Service
26 CFR Part 1
RIN 1545–BO71
Need for Correction
As published, the final regulations
(TD 9847) contain errors that need to be
corrected.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and
recordkeeping requirements.
Correction of Publication
Accordingly, 26 CFR part 1 is
corrected by making the following
correcting amendments:
PART 1—INCOME TAXES
Paragraph 1. The authority citation
for part 1 continues to read in part as
follows:
■
Authority: 26 U.S.C. 7805 * * *
Par. 2. Section 1.199A–0 is amended
by revising the entry for § 1.199A–
1(a)(16) and adding an entry for
§ 1.199A–2(b)(2)(iv) to read as follows:
■
§ 1.199A–0
*
§ 1.199A–1
Table of contents.
*
*
*
Operational rules.
(a) * * *
(16) W–2 wages.
*
*
*
*
*
Qualified Business Income Deduction;
Correction
Internal Revenue Service (IRS),
Treasury.
ACTION: Correcting amendments.
AGENCY:
This document contains
corrections to final regulations (TD
SUMMARY:
Fmt 4700
The final regulations (TD 9847),
published on February 8, 2019 (84 FR
2952), that are the subject of this
correction are issued under section
199A of the Internal Revenue Code.
*
§ 1.199A–2 Determination of W–2 Wages
and unadjusted basis immediately after
acquisition of qualified property.
[TD 9847]
Frm 00006
Background
*
DEPARTMENT OF THE TREASURY
PO 00000
9847) that were published in the
Federal Register on Friday, February 8,
2019. The final regulations are
concerning the deduction for qualified
business income under section 199A of
the Internal Revenue Code.
DATES: This correction is effective on
April 17, 2019 and is applicable on or
after February 8, 2019.
FOR FURTHER INFORMATION CONTACT:
Vishal R. Amin or Sonia K. Kothari at
(202) 317–6850 or Robert D. Alinsky,
Margaret Burow, or Wendy L. Kribell at
(202) 317–5279.
SUPPLEMENTARY INFORMATION:
Sfmt 4700
*
*
*
*
(b) * * *
(2) * * *
(iv) Methods for calculating W–2
wages.
*
*
*
*
*
■ Par. 3. Section 1.199A–1 is amended
by revising the second sentence of
paragraph (b)(10) and the seventh
E:\FR\FM\17APR1.SGM
17APR1
Federal Register / Vol. 84, No. 74 / Wednesday, April 17, 2019 / Rules and Regulations
sentence of paragraph (d)(4)(xi)(B) to
read as follows:
§ 1.199A–1
Operational rules.
*
*
*
*
*
(b) * * *
(10) * * * Other passthrough entities
including common trust funds as
described in § 1.6032–1T and religious
or apostolic organizations described in
section 501(d) are also treated as RPEs
if the entity files a Form 1065, U.S.
Return of Partnership Income, and is
owned, directly or indirectly, by at least
one individual, estate, or trust. * * *
*
*
*
*
*
(d) * * *
(4) * * *
(xi) * * *
(B) * * * Thus, F has overall net QBI
of $80,000 when all trades or businesses
are taken together ($200,000) plus
$150,000 minus $120,000 minus the
carryover loss of ($150,000). * * *
*
*
*
*
*
■ Par. 4. Section 1.199A–2 is amended
by revising the fifth sentence of
paragraph (b)(2)(iii)(A) to read as
follows:
§ 1.199A–2 Determination of W–2 wages
and unadjusted basis immediately after
acquisition of qualified properly.
*
*
*
*
*
(b) * * *
(2) * * *
(iii) * * *
(A) * * * Section 6071(c) provides
that Forms W–2 and W–3 must be filed
on or before January 31 of the year
following the calendar year to which
such returns relate (but see the special
rule in § 31.6071(a)–1T(a)(3)(i) of this
chapter for monthly returns filed under
§ 31.6011(a)–5(a) of this chapter). * * *
*
*
*
*
*
■ Par. 5. Section 1.199A–4 is amended
by revising the fourth sentence of
paragraph (c)(3), the first sentence of
paragraph (c)(4)(ii), and the third
sentence of paragraph (d)(15)(ii) to read
as follows:
§ 1.199A–4
amozie on DSK9F9SC42PROD with RULES
*
*
*
*
(c) * * *
(3) * * * However, an RPE may add
a newly created or newly acquired
(including through non-recognition
transfers) trade or business to an
existing aggregated trade or business
(including the aggregated trade or
business of a lower-tier RPE) if the
requirements of paragraph (b)(1) of this
section are satisfied. * * *
(4) * * *
(ii) * * * If an RPE fails to attach the
statement required in paragraph (c)(4)(i)
16:23 Apr 16, 2019
§ 1.199A–5 Specified service trades or
businesses and the trade or business of
performing services as an employee.
*
*
*
*
*
(b) * * *
(3) * * *
(xiv) * * * Several of the employees
and K have worked in the bicycle
business for many years, and have
acquired substantial skill and reputation
in the field. * * *
*
*
*
*
*
(d) * * *
(3) * * *
(iii) * * *
(B) * * * Unless the presumption is
rebutted with a showing that, under
Federal tax law, regulations, and
principles (including common-law
employee classification rules), C is not
an employee, C’s distributive share of
Law Firm 2 income (including any
guaranteed payments) will not be QBI
for purposes of section 199A.* * *
*
*
*
*
*
Martin V. Franks,
Chief, Publications and Regulations Branch,
Legal Processing Division, Associate Chief
Counsel (Procedure and Administration).
[FR Doc. 2019–07652 Filed 4–16–19; 8:45 am]
BILLING CODE 4830–01–P
DEPARTMENT OF THE TREASURY
Office of the Secretary of the Treasury
31 CFR Parts 27 and 50
Aggregation.
*
VerDate Sep<11>2014
of this section, the Commissioner may
disaggregate the RPE’s trades or
businesses. * * *
(d) * * *
(15) * * *
(ii) * * * If PRS2 does aggregate the
two businesses, PRS1 may not aggregate
its food service business with PRS2’s
aggregated trades or businesses. * * *
*
*
*
*
*
■ Par. 6. Section 1.199A–5 is amended
by revising the sixth sentence of
paragraph (b)(3)(xiv) and the eighth
sentence of paragraph (d)(3)(iii)((B) to
read as follows:
Jkt 247001
Inflation Adjustment of Civil Monetary
Penalties
Departmental Offices, Treasury.
Final rule.
AGENCY:
ACTION:
The Department of the
Treasury (‘‘Department’’ or ‘‘Treasury’’)
publishes this final rule to adjust its
civil monetary penalties (‘‘CMPs’’) for
inflation as mandated by the Federal
Civil Penalties Inflation Adjustment Act
of 1990, as amended by the Federal
Civil Penalties Inflation Adjustment Act
SUMMARY:
PO 00000
Frm 00007
Fmt 4700
Sfmt 4700
15955
Improvements Act of 2015 (collectively
referred to herein as ‘‘the Act’’). This
rule adjusts CMPs within the
jurisdiction of two components of the
Department to the maximum amount
required by the Act.
The final rule is effective April
17, 2019.
DATES:
For
information regarding the Terrorism
Risk Insurance Program’s CMPs, contact
Richard Ifft, Senior Insurance
Regulatory Policy Analyst, Federal
Insurance Office, Room 1410 MT,
Department of the Treasury, 1500
Pennsylvania Avenue NW, Washington,
DC 20220, at (202) 622–2922 (not a tollfree number), or Lindsey Baldwin,
Senior Policy Analyst, Federal
Insurance Office, at (202) 622–3220 (not
a toll free number). Persons who have
difficulty hearing or speaking may
access these numbers via TTY by calling
the toll-free Federal Relay Service at
(800) 877–8339.
For information regarding the
Treasury-wide CMP, contact Richard
Dodson, Senior Counsel, General Law,
Ethics, and Regulation, 202–622–9949.
FOR FURTHER INFORMATION CONTACT:
SUPPLEMENTARY INFORMATION:
I. Background
In order to improve the effectiveness
of CMPs and to maintain their deterrent
effect, the Federal Civil Penalties
Inflation Adjustment Act of 1990, 28
U.S.C. 2461 note (‘‘the Inflation
Adjustment Act’’), as amended by the
Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015 (Pub. L. 114–74) (‘‘the 2015 Act’’),
requires Federal agencies to adjust each
CMP provided by law within the
jurisdiction of the agency. The 2015 Act
requires agencies to adjust the level of
CMPs with an initial ‘‘catch-up’’
adjustment through an interim final
rulemaking and to make subsequent
annual adjustments for inflation,
without needing to provide notice and
the opportunity for public comment
required by 5 U.S.C. 553. The
Department’s initial catch-up
adjustment interim final rules were
published on December 7, 2016
(Departmental Offices) (81 FR 88600),
and for 31 CFR part 27, on February 11,
2019 (84 FR 3105). The Department’s
2018 annual adjustment was published
on March 19, 2018 (83 FR 11876). The
2015 Act provides that any increase in
a CMP shall apply to CMPs that are
assessed after the date the increase takes
effect, regardless of whether the
E:\FR\FM\17APR1.SGM
17APR1
]]>Agencies
[Federal Register Volume 84, Number 74 (Wednesday, April 17, 2019)]
[Rules and Regulations]
[Pages 15954-15955]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-07652]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9847]
RIN 1545-BO71
Qualified Business Income Deduction; Correction
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Correcting amendments.
-----------------------------------------------------------------------
SUMMARY: This document contains corrections to final regulations (TD
9847) that were published in the Federal Register on Friday, February
8, 2019. The final regulations are concerning the deduction for
qualified business income under section 199A of the Internal Revenue
Code.
DATES: This correction is effective on April 17, 2019 and is applicable
on or after February 8, 2019.
FOR FURTHER INFORMATION CONTACT: Vishal R. Amin or Sonia K. Kothari at
(202) 317-6850 or Robert D. Alinsky, Margaret Burow, or Wendy L.
Kribell at (202) 317-5279.
SUPPLEMENTARY INFORMATION:
Background
The final regulations (TD 9847), published on February 8, 2019 (84
FR 2952), that are the subject of this correction are issued under
section 199A of the Internal Revenue Code.
Need for Correction
As published, the final regulations (TD 9847) contain errors that
need to be corrected.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Correction of Publication
Accordingly, 26 CFR part 1 is corrected by making the following
correcting amendments:
PART 1--INCOME TAXES
0
Paragraph 1. The authority citation for part 1 continues to read in
part as follows:
Authority: 26 U.S.C. 7805 * * *
0
Par. 2. Section 1.199A-0 is amended by revising the entry for Sec.
1.199A-1(a)(16) and adding an entry for Sec. 1.199A-2(b)(2)(iv) to
read as follows:
Sec. 1.199A-0 Table of contents.
* * * * *
Sec. 1.199A-1 Operational rules.
(a) * * *
(16) W-2 wages.
* * * * *
Sec. 1.199A-2 Determination of W-2 Wages and unadjusted basis
immediately after acquisition of qualified property.
* * * * *
(b) * * *
(2) * * *
(iv) Methods for calculating W-2 wages.
* * * * *
0
Par. 3. Section 1.199A-1 is amended by revising the second sentence of
paragraph (b)(10) and the seventh
[[Page 15955]]
sentence of paragraph (d)(4)(xi)(B) to read as follows:
Sec. 1.199A-1 Operational rules.
* * * * *
(b) * * *
(10) * * * Other passthrough entities including common trust funds
as described in Sec. 1.6032-1T and religious or apostolic
organizations described in section 501(d) are also treated as RPEs if
the entity files a Form 1065, U.S. Return of Partnership Income, and is
owned, directly or indirectly, by at least one individual, estate, or
trust. * * *
* * * * *
(d) * * *
(4) * * *
(xi) * * *
(B) * * * Thus, F has overall net QBI of $80,000 when all trades or
businesses are taken together ($200,000) plus $150,000 minus $120,000
minus the carryover loss of ($150,000). * * *
* * * * *
0
Par. 4. Section 1.199A-2 is amended by revising the fifth sentence of
paragraph (b)(2)(iii)(A) to read as follows:
Sec. 1.199A-2 Determination of W-2 wages and unadjusted basis
immediately after acquisition of qualified properly.
* * * * *
(b) * * *
(2) * * *
(iii) * * *
(A) * * * Section 6071(c) provides that Forms W-2 and W-3 must be
filed on or before January 31 of the year following the calendar year
to which such returns relate (but see the special rule in Sec.
31.6071(a)-1T(a)(3)(i) of this chapter for monthly returns filed under
Sec. 31.6011(a)-5(a) of this chapter). * * *
* * * * *
0
Par. 5. Section 1.199A-4 is amended by revising the fourth sentence of
paragraph (c)(3), the first sentence of paragraph (c)(4)(ii), and the
third sentence of paragraph (d)(15)(ii) to read as follows:
Sec. 1.199A-4 Aggregation.
* * * * *
(c) * * *
(3) * * * However, an RPE may add a newly created or newly acquired
(including through non-recognition transfers) trade or business to an
existing aggregated trade or business (including the aggregated trade
or business of a lower-tier RPE) if the requirements of paragraph
(b)(1) of this section are satisfied. * * *
(4) * * *
(ii) * * * If an RPE fails to attach the statement required in
paragraph (c)(4)(i) of this section, the Commissioner may disaggregate
the RPE's trades or businesses. * * *
(d) * * *
(15) * * *
(ii) * * * If PRS2 does aggregate the two businesses, PRS1 may not
aggregate its food service business with PRS2's aggregated trades or
businesses. * * *
* * * * *
0
Par. 6. Section 1.199A-5 is amended by revising the sixth sentence of
paragraph (b)(3)(xiv) and the eighth sentence of paragraph
(d)(3)(iii)((B) to read as follows:
Sec. 1.199A-5 Specified service trades or businesses and the trade
or business of performing services as an employee.
* * * * *
(b) * * *
(3) * * *
(xiv) * * * Several of the employees and K have worked in the
bicycle business for many years, and have acquired substantial skill
and reputation in the field. * * *
* * * * *
(d) * * *
(3) * * *
(iii) * * *
(B) * * * Unless the presumption is rebutted with a showing that,
under Federal tax law, regulations, and principles (including common-
law employee classification rules), C is not an employee, C's
distributive share of Law Firm 2 income (including any guaranteed
payments) will not be QBI for purposes of section 199A.* * *
* * * * *
Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division,
Associate Chief Counsel (Procedure and Administration).
[FR Doc. 2019-07652 Filed 4-16-19; 8:45 am]
BILLING CODE 4830-01-P
