Contribution Limits Applicable to ABLE Accounts, 54529-54533 [2019-21477]

Download as PDF Federal Register / Vol. 84, No. 197 / Thursday, October 10, 2019 / Proposed Rules internet at http://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA’s web page at http:// www.faa.gov/air-traffic/publications/ airspace-amendments/. You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (see the ADDRESSES section for the address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except federal holidays. An informal docket may also be examined during normal business hours at the Federal Aviation Administration, Air Traffic Organization, Central Service Center, Operations Support Group, 10101 Hillwood Parkway, Fort Worth, TX 76177. keep them operationally current, is noncontroversial and unlikely to result in adverse or negative comments. It, therefore: (1) Is not a ‘‘significant regulatory action’’ under Executive Order 12866; (2) is not a ‘‘significant rule’’ under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this proposed rule, when promulgated, would not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. Availability and Summary of Documents for Incorporation by Reference This document proposes to amend FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019. FAA Order 7400.11D is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11D lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points. This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, ‘‘Environmental Impacts: Policies and Procedures’’ prior to any FAA final regulatory action. The Proposal The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 by amending Class E airspace extending upward from 700 feet above the surface within a 6.3-mile radius of Neillsville Municipal Airport, Neillsville, WI, and removing the Neillsville NDB, this action is necessary due to the decommissioning of the Neillsville NDB, and for the safety and management of instrument flight rules (IFR) operations at the airport. Class E airspace designations are published in paragraph 6005 of FAA Order 7400.11D, dated August 8, 2019, and effective September 15, 2019, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document will be published subsequently in the Order. FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15. Regulatory Notices and Analyses The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to VerDate Sep<11>2014 16:44 Oct 09, 2019 Jkt 250001 Environmental Review List of Subjects in 14 CFR Part 71 Airspace, Incorporation by reference, Navigation (air). The Proposed Amendment Accordingly, pursuant to the authority delegated to me, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows: PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS 1. The authority citation for 14 CFR part 71 continues to read as follows: ■ Authority: 49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959–1963 Comp., p. 389. § 71.1 [Amended] 2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019, is amended as follows: ■ Paragraph 6005 Class E Airspace Areas Extending Upward From 700 Feet or More Above the Surface of the Earth * * * AGL WI E5 * * Neillsville, WI [Amended] Neillsville Municipal Airport, WI (Lat. 44°33′29″ N, long. 90°30′44″ W) That airspace extending upward from 700 feet above the surface within a 6.3-mile radius of Neillsville Municipal Airport. PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 54529 Issued in Fort Worth, Texas, on October 2, 2019. Steve Szukala, Acting Manager, Operations Support Group, ATO Central Service Center. [FR Doc. 2019–21960 Filed 10–9–19; 8:45 am] BILLING CODE 4910–13–P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 1 RIN 1545–BP10 Contribution Limits Applicable to ABLE Accounts Internal Revenue Service (IRS), Treasury. ACTION: Notice of proposed rulemaking. AGENCY: This document contains proposed regulations related to the Internal Revenue Code (Code), which allows a State (or its agency or instrumentality) to establish and maintain a tax-advantaged savings program under which contributions may be made to an ABLE account for the purpose of paying for the qualified disability expenses of the designated beneficiary of the account. The affected Code section was amended by the Tax Cuts and Jobs Act, signed into law on December 22, 2017. The Tax Cuts and Jobs Act allows certain designated beneficiaries to contribute a limited amount of compensation income to their own ABLE accounts. DATES: Comments must be received by January 8, 2020. ADDRESSES: Submit electronic submissions via the Federal eRulemaking Portal at www.regulations.gov (indicate IRS and REG–128246–18) by following the online instructions for submitting comments. Once submitted to the Federal eRulemaking Portal at www.regulations.gov comments cannot be edited or withdrawn. The Department of the Treasury (Treasury Department) and the IRS will publish for public availability any comment received to its public docket, whether submitted electronically or in hard copy. Send hard copy submissions to: CC:PA:LPD:PR (REG–128246–18), 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–128246– 18), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue NW, Washington, DC 20224. SUMMARY: E:\FR\FM\10OCP1.SGM 10OCP1 54530 Federal Register / Vol. 84, No. 197 / Thursday, October 10, 2019 / Proposed Rules FOR FURTHER INFORMATION CONTACT: Concerning these proposed regulations, Julia Parnell, (202) 317–4086; concerning submissions of comments and requests for a public hearing, Regina Johnson at email address fdms.database@irscounsel.treas.gov and (202) 317–6901 (not toll-free numbers). SUPPLEMENTARY INFORMATION: This document contains proposed regulations related to section 529A of the Internal Revenue Code (Code), which allows a State (or its agency or instrumentality) to establish and maintain a tax-advantaged savings program under which contributions may be made to an ABLE account for the purpose of paying for the qualified disability expenses of the designated beneficiary of the account. Section 529A was amended by the Tax Cuts and Jobs Act, Public Law 115–97, 131 Stat. 2054, (2017) (2017 Act), signed into law on December 22, 2017. The 2017 Act allows certain designated beneficiaries to contribute a limited amount of compensation income to their own ABLE accounts. Background 1. The ABLE Act The Stephen Beck, Jr., Achieving a Better Life Experience Act of 2014 (the ‘‘ABLE Act’’) was enacted on December 19, 2014, as part of the Tax Increase Prevention Act of 2014, Public Law 113–295, 128 Stat. 4010, (2014). The ABLE Act added section 529A to the Code. Section 529A allows a State (or its agency or instrumentality) to establish and maintain a tax-advantaged savings program under which contributions may be made to an ABLE account for the purpose of paying for the qualified disability expenses of the designated beneficiary of the account. Section 529A was amended by the 2017 Act. Prior to its amendment by the 2017 Act, section 529A(b)(2) stated that a program shall not be treated as a qualified ABLE program unless it provides that no contribution will be accepted unless it is in cash, or if the contribution (other than a rollover contribution described in section 529A(c)(1)(C)) would result in aggregate contributions from all contributors in excess of the amount of the section 2503(b) gift tax exclusion for the calendar year in which the designated beneficiary’s taxable year begins. Under section 529A(b)(2), rules similar to the rules of section 408(d)(4) apply to permit the return of excess contributions (with any attributable net income) on or before the due date (including extensions) of the designated beneficiary’s income tax return. In VerDate Sep<11>2014 16:44 Oct 09, 2019 Jkt 250001 addition, under section 529A(b)(6), a qualified ABLE program must provide adequate safeguards to ensure that total contributions do not exceed the State’s limit for aggregate contributions under its qualified tuition program as described in section 529(b)(6). A qualified tuition program under section 529 is a program established by a State (or its agency or instrumentality) that permits a person to prepay or contribute to a tax-favored savings account for a designated beneficiary’s qualified higher education expenses (QHEEs) or a program established by an eligible educational institution that permits a person to prepay a designated beneficiary’s QHEEs. 2. Prior Rulemaking and Statutory Change On June 22, 2015, the Treasury Department and the IRS published a Notice of Proposed Rulemaking (REG– 102837–15) in the Federal Register (80 FR 35602) (the 2015 Proposed Regulations). More than 200 written comments were received in response to the 2015 Proposed Regulations and a public hearing was held on October 14, 2015.1 In addition to these comments, several commenters asked the Treasury Department and the IRS to issue interim guidance to address three particular issues so that these programs could be established before the issuance of final regulations. In order to prevent a delay in the creation of ABLE programs, the Treasury Department and the IRS issued Notice 2015–81, 2015–49 I.R.B. 784 (Dec. 7, 2015), which describes how the Treasury Department and the IRS intend to revise three particular provisions of the proposed regulations under section 529A when those regulations are finalized. Since the issuance of the 2015 Proposed Regulations and the Notice, two statutes have been enacted that amended one or more provisions of section 529A. On December 18, 2015, section 303 of the Protecting Americans from Tax Hikes Act of 2015 (the PATH Act), was enacted as part of the Consolidated Appropriations Act, Public Law 114–113, 129 Stat. 2242, (2016). The PATH Act amended section 529A(b)(1), effective for taxable years beginning after December 31, 2014, by removing the requirement that a State’s qualified ABLE program allow the establishment of an ABLE account only for a designated beneficiary who is a resident of that State or of a contracting 1 Comments related to the 2015 Proposed Regulations will be considered prior to finalizing them, which the Treasury Department and the IRS expect to occur in conjunction with the finalization of these proposed regulations. PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 State. Due to this amendment, the Treasury Department and the IRS intend to remove references to the residency requirement in the proposed regulations under section 529A when those regulations are finalized. The other statutory change was made in the 2017 Act as described in these proposed regulations. 3. The 2017 Act The 2017 Act amended section 529A(b)(2)(B) to allow an employed designated beneficiary described in new section 529A(b)(7) to contribute, prior to January 1, 2026, an additional amount in excess of the limit in section 529A(b)(2)(B)(i) (the annual gift tax exclusion amount in section 2503(b), formerly set forth in section 529A(b)(2)(B)). This additional permissible contribution is subject to its own limit as described in section 529A(b)(2)(B)(ii). Specifically, this additional contributed amount may not exceed the lesser of (i) the designated beneficiary’s compensation as defined by section 219(f)(1) for the taxable year, or (ii) an amount equal to the poverty line for a one-person household for the calendar year preceding the calendar year in which the taxable year begins. The 2017 Act also amended the section 529A(b)(2) flush language to require the designated beneficiary, or a person acting on behalf of the designated beneficiary, to maintain adequate records to ensure, and to be responsible for ensuring, that the requirements of section 529A(b)(2)(B)(ii) are met. New section 529A(b)(7)(A) identifies a designated beneficiary eligible to make this additional contribution as one who is an employee (including a selfemployed individual) with respect to whom there has been no contribution made for the taxable year to: a defined contribution plan meeting the requirements of sections 401(a) or 403(a); an annuity contract described in section 403(b); or an eligible deferred contribution plan under section 457(b). Section 529A(b)(7)(B) defines the term ‘‘poverty line’’ as having the meaning provided in section 673 of the Community Services Block Grant Act (42 U.S.C. 9902). The 2017 Act also amended section 529 to allow, before January 1, 2026, a limited amount to be rolled over to an ABLE account from the designated beneficiary’s own section 529 qualified tuition program (QTP) account or from the QTP account of certain family members. The 2017 Act added section 529(c)(3)(C)(i)(III), which provides that a distribution from a QTP made after December 22, 2017, and before January 1, 2026, is not subject to income tax if, E:\FR\FM\10OCP1.SGM 10OCP1 Federal Register / Vol. 84, No. 197 / Thursday, October 10, 2019 / Proposed Rules within 60 days of the distribution, it is transferred to an ABLE account of the designated beneficiary or a member of the family of the designated beneficiary. Under section 529(c)(3)(C)(i), the amount of any rollover to an ABLE account is limited to the amount that, when added to all other contributions made to the ABLE account for the taxable year, does not exceed the contribution limit for the ABLE account under section 529A(b)(2)(B)(i), that is, the annual gift tax exclusion amount under section 2503(b). This limited rollover is described in more detail in Notice 2018–58, 2018–33 I.R.B. 305 (Aug. 13, 2018). 4. Notice 2018–62 To address the 2017 Act modifications to section 529A, the Treasury Department and the IRS published Notice 2018–62, 2018–34 I.R.B. 316 (Aug. 20, 2018), which announces the intent of the Treasury Department and the IRS to issue proposed regulations to implement these changes, and describes the anticipated rules to implement the statutory changes. No comments were received in response to the Notice. These proposed regulations incorporate, without substantive change, the anticipated rules described in that Notice. Explanation of Provisions 1. Additional Contributions The 2017 Act amended section 529A(b)(2)(B) to permit an employed or self-employed designated beneficiary described in section 529A(b)(7) to contribute to his or her ABLE account the lesser of the designated beneficiary’s compensation for the taxable year or an amount equal to the poverty line for a one-person household for the calendar year preceding the calendar year in which the designated beneficiary’s taxable year begins. These proposed regulations confirm that the employed designated beneficiary, or the person acting on his or her behalf, is solely responsible for ensuring that the requirements in section 529A(b)(2)(B)(ii) are met and for maintaining adequate records for that purpose. In addition, to minimize burdens for the designated beneficiary and the qualified ABLE program, these proposed regulations provide that ABLE programs may allow a designated beneficiary or the person acting on his or her behalf to certify, under penalties of perjury, that he or she is a designated beneficiary described in section 529A(b)(7) and that his or her contributions of VerDate Sep<11>2014 16:44 Oct 09, 2019 Jkt 250001 compensation do not exceed the limit set forth in section 529A(b)(2)(B)(ii). 2. Poverty Line Section 529A(b)(7)(B) provides that the term poverty line referred to in section 529A(b)(2)(B)(ii) has the same meaning given to that term by section 673 of the Community Services Block Grant Act (42 U.S.C. 9902). These proposed regulations clarify that the poverty line in section 529A(b)(7)(B) is to be determined by using the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. 9902(2). Those guidelines vary based on locality. Specifically, there are separate guidelines for (1) the contiguous 48 states and the District of Columbia, (2) Alaska, and (3) Hawaii. Because the Treasury Department and the IRS have concluded that the poverty guideline that most closely reflects the employed designated beneficiary’s cost of living is the most relevant for determining the contribution limit, these proposed regulations provide that a designated beneficiary’s contribution limit is to be determined using the poverty guideline applicable in the state of the designated beneficiary’s residence. 3. Return of Excess Contributions Because section 529A(b)(2) provides that rules similar to those set forth in section 408(d)(4) regarding the return of excess contributions to an individual retirement account or annuity apply to ABLE accounts, these proposed regulations provide that a qualified ABLE program must return any contributions of the designated beneficiary’s compensation in excess of the limit in section 529A(b)(2)(B)(ii) to the designated beneficiary. Consistent with section 529A(b)(2), these proposed regulations provide that it will be the sole responsibility of the designated beneficiary (or the person acting on the designated beneficiary’s behalf) to identify and request the return of any excess contribution of such compensation income. Such returns of excess compensation contributions must be received by the employed designated beneficiary on or before the due date (including extensions) of the designated beneficiary’s income tax return for the year in which the excess compensation contributions were made. A failure to return excess contributions within this time period will result in the imposition on the designated beneficiary of a 6 percent excise tax under section 4973(a)(6) on the amount of excess compensation contributions. PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 54531 Additionally, in order to minimize administrative burdens for the designated beneficiary and the qualified ABLE program, for purposes of ensuring that the limit on contributions made under section 529A(b)(2)(B)(ii) is not exceeded, the qualified ABLE program may rely on self-certifications, made under penalties of perjury, of the designated beneficiary or the person acting on the designated beneficiary’s behalf. Proposed Effective/Applicability Date These regulations are proposed to apply to taxable years beginning after the date of publication of the Treasury decision adopting these rules as final regulations in the Federal Register. Until the issuance of final regulations, taxpayers and qualified ABLE programs may rely on these proposed regulations. Special Analyses This regulation is not subject to review under section 6(b) of Executive Order 12866 pursuant to the Memorandum of Agreement (April 11, 2018) between the Department of the Treasury and the Office of Management and Budget regarding review of tax regulations. Regulatory Flexibility Act Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it is hereby certified that the collection of information in these regulations will not have a significant economic impact on a substantial number of small entities. This certification is based on the fact that these proposed regulations will not impact a substantial number of small entities. These regulations primarily affect states and individuals and therefore will not have a significant economic impact on a substantial number of small entities. Pursuant to section 7805(f) of the Code, these proposed regulations will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business. Comments and Requests for Public Hearing Before these proposed regulations are adopted as final regulations, consideration will be given to any comments that are timely submitted to the IRS as prescribed in this preamble under the ADDRESSES heading. The Treasury Department and the IRS request comments on all aspects of these proposed rules. All comments will be available at www.regulations.gov or upon request. A public hearing will be scheduled if requested in writing by any E:\FR\FM\10OCP1.SGM 10OCP1 54532 Federal Register / Vol. 84, No. 197 / Thursday, October 10, 2019 / Proposed Rules person that timely submits written or electronic comments. If a public hearing is scheduled, notice of the date, time, and place for the hearing will be published in the Federal Register. Statement of Availability of IRS Documents Notices 2015–81, 2018–58 and 2018– 62 are published in the Internal Revenue Bulletin and are available from the Superintendent of Documents, U.S. Government Publishing Office, Washington, DC 20402, or by visiting the IRS website at http://www.irs.gov. Drafting Information The principal author of these regulations is Julia Parnell, Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). However, other personnel from the IRS and the Treasury Department participated in their development. List of Subjects in 26 CFR Part 1 Proposed Amendments to the Regulations Accordingly, 26 CFR part 1 is proposed to be amended as follows: PART 1—INCOME TAXES Paragraph 1. The authority citation for part 1 is amended by adding an entry for § 1.529A–8 in numerical order to read in part as follows: ■ Authority: 26 U.S.C. 7805 * * * * * * * Section 1.529A–8 also issued under 26 U.S.C. 529A(g). * * * * * Par. 2. Section 1.529A–0, as proposed to be added at 80 FR 35602, June 22, 2015, is further amended by adding an entry for § 1.529A–8 in numerical order to read as follows: ■ § 1.529A–0 * * Table of contents. * * * § 1.529A–8 Additional contributions to ABLE accounts made by an employed designated beneficiary. (a) Additional contributions to ABLE accounts made by an employed designated beneficiary. (1) In general. (2) Amount of additional contribution. (b) Additional definitions. (1) Employed designated beneficiary. (2) Applicable poverty line. (3) Excess compensation contribution. (c) Example. VerDate Sep<11>2014 16:44 Oct 09, 2019 Jkt 250001 § 1.529A–1 Exempt status of qualified ABLE program and definitions. * * * * * (b) * * * (3) Contribution means any payment directly allocated to an ABLE account for the benefit of the designated beneficiary, including amounts transferred from a qualified tuition program under section 529 after December 22, 2017 and before January 1, 2026. * * * * * ■ Par. 4. Section 1.529A-8 is added to read as follows: § 1.529A–8 Additional contributions to ABLE accounts made by an employed designated beneficiary. Income taxes, Reporting and recordkeeping requirements. * (d) Responsibility for ensuring contribution limit is met. (e) Return of excess compensation contributions. (f) Applicability date. ■ Par.3. Section 1.529A–1, as proposed to be added at 80 FR 35602, June 22, 2015, is further amended by revising paragraph (b)(3) to read as follows: (a) Additional contributions by an employed designated beneficiary—(1) In general. An employed designated beneficiary defined in paragraph (b)(1) of this section may contribute amounts up to the limit specified in paragraph (a)(2) of this section in addition to the annual amount described in section 529A(b)(2)(B)(i). (2) Amount of additional permissible contribution. Any additional contribution made by the designated beneficiary pursuant to this section is limited to the lesser of— (i) The designated beneficiary’s compensation as defined by section 219(f)(1) for the taxable year; or (ii) An amount equal to the applicable poverty line, as defined in paragraph (b)(2) of this section, for a one-person household for the calendar year preceding the calendar year in which the designated beneficiary’s taxable year begins. (b) Additional definitions. In addition to the definitions in § 1.529A–1(b), the following definitions also apply for the purposes of this section— (1) Employed designated beneficiary means a designated beneficiary who is an employee (including an employee within the meaning of section 401(c)), with respect to whom no contribution is made for the taxable year to— (i) A defined contribution plan (within the meaning of section 414(i)) with respect to which the requirements of sections 401(a) or 403(a) are met; (ii) An annuity contract described in section 403(b); and PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 (iii) An eligible deferred compensation plan described in section 457(b). (2) Applicable poverty line means the amount provided in the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. 9902(2) for the State of residence of the employed designated beneficiary. If the designated beneficiary lives in more than one state during the taxable year, the applicable poverty line is the poverty line for the state in which the designated beneficiary resided longer than in any other state during that year. (3) Excess compensation contribution means the amount by which the amount contributed during the taxable year of an employed designated beneficiary to the designated beneficiary’s ABLE account exceeds the limit in effect under section 529A(b)(2)(B)(ii) and paragraph (a)(2) of this section for the calendar year in which that taxable year of the employed designated beneficiary begins. (c) Example. The following example illustrates the principles of paragraphs (a)(2) and (b)(2) of this section. In 2019, A, the designated beneficiary of an ABLE account, lives in Hawaii. A’s compensation, as defined by section 219(f)(1), for 2019 is $20,000. The poverty line for a one-person household in Hawaii was $13,960 in 2018. Because A’s compensation exceeded the applicable poverty line amount, A’s additional permissible contribution in 2019 is limited to $13,960, the amount of the 2018 applicable poverty line. (d) Responsibility for ensuring contribution limit is met. (1) The employed designated beneficiary, or the person acting on his or her behalf, is solely responsible for ensuring that the requirements in section 529A(b)(2)(B)(ii) and paragraph (a)(2) of this section are met and for maintaining adequate records for that purpose. (2) A qualified ABLE program may allow a designated beneficiary (or the person acting on his or her behalf) to certify, under penalties of perjury, and in the manner specified by the qualified ABLE program that— (i) The designated beneficiary is an employed designated beneficiary; and (ii) The designated beneficiary’s contributions of compensation are not excess compensation contributions. (e) Return of excess compensation contributions. If an excess compensation contribution is deposited into or allocated to the ABLE account of a designated beneficiary, the qualified ABLE program must return that excess contribution, including all net income E:\FR\FM\10OCP1.SGM 10OCP1 Federal Register / Vol. 84, No. 197 / Thursday, October 10, 2019 / Proposed Rules attributable to the excess contribution, as determined under the rules set forth in § 1.408–11 (treating references to an IRA as references to an ABLE account, and references to returned contributions under section 408(d)(4) as references to excess compensation contributions), to the employed designated beneficiary. The employed designated beneficiary, or the person acting on the employed designated beneficiary’s behalf, is responsible for identifying any excess compensation contribution and for requesting the return of the excess compensation contribution. The excess compensation contribution, if requested, must be received by the employed designated beneficiary on or before the due date (including extensions) of the Federal income tax return of the employed designated beneficiary for the taxable year in which the excess compensation contribution is made. (f) Applicability date. The rules of this section apply to taxable years beginning after [DATE OF PUBLICATION OF FINAL REGULATIONS IN THE Federal Register]. Kirsten Wielobob, Deputy Commissioner for Services and Enforcement. [FR Doc. 2019–21477 Filed 10–9–19; 8:45 am] BILLING CODE 4830–01–P NATIONAL LABOR RELATIONS BOARD 29 CFR Part 103 RIN 3142–AA16 Representation—Case Procedures: Election Bars; Proof of Majority Support in Construction Industry Collective-Bargaining Relationships AGENCY: National Labor Relations Board. Notice of extension of time to submit comments. ACTION: The National Labor Relations Board (the Board) published a Notice of Proposed Rulemaking in the Federal Register of August 12, 2019, seeking comments from the public regarding its proposed amendments to Part 103 of its Rules and Regulations, specifically concerning the Board’s blocking charge policy, the voluntary recognition bar, and Section 9(a) recognition in the construction industry. The date to submit comments to the Notice is extended for 60 days. DATES: Comments to the Notice of Proposed Rulemaking must be received by the Board on or before December 10, 2019. Comments replying to the SUMMARY: VerDate Sep<11>2014 16:44 Oct 09, 2019 Jkt 250001 comments submitted during the initial comment period must be received by the Board on or before December 24, 2019. ADDRESSES: Internet—Federal eRulemaking Portal. Electronic comments may be submitted through http://www.regulations.gov. Delivery—Comments should be sent by mail or hand delivery to: Roxanne Rothschild, Executive Secretary, National Labor Relations Board, 1015 Half Street SE, Washington, DC 20570– 0001. Because of security precautions, the Board continues to experience delays in U.S. mail delivery. You should take this into consideration when preparing to meet the deadline for submitting comments. The Board encourages electronic filing. It is not necessary to send comments if they have been filed electronically with regulations.gov. If you send comments, the Board recommends that you confirm receipt of your delivered comments by contacting (202) 273–1940 (this is not a toll-free number). Individuals with hearing impairments may call 1–866– 315–6572 (TTY/TDD). Only comments submitted through http://www.regulations.gov, hand delivered, or mailed will be accepted; ex parte communications received by the Board will be made part of the rulemaking record and will be treated as comments only insofar as appropriate. Comments will be available for public inspection at http:// www.regulations.gov and during normal business hours (8:30 a.m. to 5 p.m. EST) at the above address. The Board will post, as soon as practicable, all comments received on http://www.regulations.gov without making any changes to the comments, including any personal information provided. The website http:// www.regulations.gov is the Federal eRulemaking portal, and all comments posted there are available and accessible to the public. The Board requests that comments include full citations or internet links to any authority relied upon. The Board cautions commenters not to include personal information such as Social Security numbers, personal addresses, telephone numbers, and email addresses in their comments, as such submitted information will become viewable by the public via the http://www.regulations.gov website. It is the commenter’s responsibility to safeguard his or her information. Comments submitted through http:// www.regulations.gov will not include the commenter’s email address unless the commenter chooses to include that PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 54533 information as part of his or her comment. FOR FURTHER INFORMATION CONTACT: Roxanne Rothschild, Executive Secretary, National Labor Relations Board, 1015 Half Street SE, Washington, DC 20570–0001, (202) 273–1940 (this is not a toll-free number), 1–866–315–6572 (TTY/TDD). Dated: October 4, 2019. Roxanne Rothschild, Executive Secretary. [FR Doc. 2019–22041 Filed 10–9–19; 8:45 am] BILLING CODE P DEPARTMENT OF TRANSPORTATION National Highway Traffic Safety Administration 49 CFR Part 571 [Docket No. NHTSA–2018–0021] RIN 2127–AM02 Federal Motor Vehicle Safety Standard No. 111, Rear Visibility National Highway Traffic Safety Administration (NHTSA), Department of Transportation (DOT). ACTION: Advance notice of proposed rulemaking (ANPRM). AGENCY: NHTSA seeks public comment on permitting camera-based rear visibility systems, commonly referred to as ‘‘Camera Monitor Systems’’ or ‘‘CMS,’’ as an alternative to inside and outside rearview mirrors. Federal motor vehicle safety standard (FMVSS) No. 111, ‘‘Rear Visibility,’’ currently requires that vehicles be equipped with rearview mirrors to provide drivers with a view of objects that are to their side or to their side and rear. This notice responds to two rulemaking petitions from manufacturers seeking permission to install CMS, instead of outside rearview mirrors, on both light vehicles and heavy trucks. This ANPRM builds on the agency’s prior efforts to obtain supporting technical information, data, and analysis on CMS so that the agency can determine whether these systems can provide the same level of safety as the rearview mirrors currently required under FMVSS No. 111. DATES: Written information should be submitted by December 9, 2019. ADDRESSES: You may submit comments identified by the docket number in the heading of this document or by any of the following methods: • Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the SUMMARY: E:\FR\FM\10OCP1.SGM 10OCP1

Agencies

[Federal Register Volume 84, Number 197 (Thursday, October 10, 2019)]
[Proposed Rules]
[Pages 54529-54533]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-21477]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

RIN 1545-BP10


Contribution Limits Applicable to ABLE Accounts

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking.

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SUMMARY: This document contains proposed regulations related to the 
Internal Revenue Code (Code), which allows a State (or its agency or 
instrumentality) to establish and maintain a tax-advantaged savings 
program under which contributions may be made to an ABLE account for 
the purpose of paying for the qualified disability expenses of the 
designated beneficiary of the account. The affected Code section was 
amended by the Tax Cuts and Jobs Act, signed into law on December 22, 
2017. The Tax Cuts and Jobs Act allows certain designated beneficiaries 
to contribute a limited amount of compensation income to their own ABLE 
accounts.

DATES: Comments must be received by January 8, 2020.

ADDRESSES: Submit electronic submissions via the Federal eRulemaking 
Portal at www.regulations.gov (indicate IRS and REG-128246-18) by 
following the online instructions for submitting comments. Once 
submitted to the Federal eRulemaking Portal at www.regulations.gov 
comments cannot be edited or withdrawn. The Department of the Treasury 
(Treasury Department) and the IRS will publish for public availability 
any comment received to its public docket, whether submitted 
electronically or in hard copy. Send hard copy submissions to: 
CC:PA:LPD:PR (REG-128246-18), 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-128246-18), Courier's Desk, Internal 
Revenue Service, 1111 Constitution Avenue NW, Washington, DC 20224.

[[Page 54530]]


FOR FURTHER INFORMATION CONTACT: Concerning these proposed regulations, 
Julia Parnell, (202) 317-4086; concerning submissions of comments and 
requests for a public hearing, Regina Johnson at email address 
[email protected] and (202) 317-6901 (not toll-free 
numbers).

SUPPLEMENTARY INFORMATION: This document contains proposed regulations 
related to section 529A of the Internal Revenue Code (Code), which 
allows a State (or its agency or instrumentality) to establish and 
maintain a tax-advantaged savings program under which contributions may 
be made to an ABLE account for the purpose of paying for the qualified 
disability expenses of the designated beneficiary of the account. 
Section 529A was amended by the Tax Cuts and Jobs Act, Public Law 115-
97, 131 Stat. 2054, (2017) (2017 Act), signed into law on December 22, 
2017. The 2017 Act allows certain designated beneficiaries to 
contribute a limited amount of compensation income to their own ABLE 
accounts.

Background

1. The ABLE Act

    The Stephen Beck, Jr., Achieving a Better Life Experience Act of 
2014 (the ``ABLE Act'') was enacted on December 19, 2014, as part of 
the Tax Increase Prevention Act of 2014, Public Law 113-295, 128 Stat. 
4010, (2014). The ABLE Act added section 529A to the Code. Section 529A 
allows a State (or its agency or instrumentality) to establish and 
maintain a tax-advantaged savings program under which contributions may 
be made to an ABLE account for the purpose of paying for the qualified 
disability expenses of the designated beneficiary of the account. 
Section 529A was amended by the 2017 Act.
    Prior to its amendment by the 2017 Act, section 529A(b)(2) stated 
that a program shall not be treated as a qualified ABLE program unless 
it provides that no contribution will be accepted unless it is in cash, 
or if the contribution (other than a rollover contribution described in 
section 529A(c)(1)(C)) would result in aggregate contributions from all 
contributors in excess of the amount of the section 2503(b) gift tax 
exclusion for the calendar year in which the designated beneficiary's 
taxable year begins. Under section 529A(b)(2), rules similar to the 
rules of section 408(d)(4) apply to permit the return of excess 
contributions (with any attributable net income) on or before the due 
date (including extensions) of the designated beneficiary's income tax 
return. In addition, under section 529A(b)(6), a qualified ABLE program 
must provide adequate safeguards to ensure that total contributions do 
not exceed the State's limit for aggregate contributions under its 
qualified tuition program as described in section 529(b)(6). A 
qualified tuition program under section 529 is a program established by 
a State (or its agency or instrumentality) that permits a person to 
prepay or contribute to a tax-favored savings account for a designated 
beneficiary's qualified higher education expenses (QHEEs) or a program 
established by an eligible educational institution that permits a 
person to prepay a designated beneficiary's QHEEs.

2. Prior Rulemaking and Statutory Change

    On June 22, 2015, the Treasury Department and the IRS published a 
Notice of Proposed Rulemaking (REG-102837-15) in the Federal Register 
(80 FR 35602) (the 2015 Proposed Regulations). More than 200 written 
comments were received in response to the 2015 Proposed Regulations and 
a public hearing was held on October 14, 2015.\1\ In addition to these 
comments, several commenters asked the Treasury Department and the IRS 
to issue interim guidance to address three particular issues so that 
these programs could be established before the issuance of final 
regulations. In order to prevent a delay in the creation of ABLE 
programs, the Treasury Department and the IRS issued Notice 2015-81, 
2015-49 I.R.B. 784 (Dec. 7, 2015), which describes how the Treasury 
Department and the IRS intend to revise three particular provisions of 
the proposed regulations under section 529A when those regulations are 
finalized.
---------------------------------------------------------------------------

    \1\ Comments related to the 2015 Proposed Regulations will be 
considered prior to finalizing them, which the Treasury Department 
and the IRS expect to occur in conjunction with the finalization of 
these proposed regulations.
---------------------------------------------------------------------------

    Since the issuance of the 2015 Proposed Regulations and the Notice, 
two statutes have been enacted that amended one or more provisions of 
section 529A. On December 18, 2015, section 303 of the Protecting 
Americans from Tax Hikes Act of 2015 (the PATH Act), was enacted as 
part of the Consolidated Appropriations Act, Public Law 114-113, 129 
Stat. 2242, (2016). The PATH Act amended section 529A(b)(1), effective 
for taxable years beginning after December 31, 2014, by removing the 
requirement that a State's qualified ABLE program allow the 
establishment of an ABLE account only for a designated beneficiary who 
is a resident of that State or of a contracting State. Due to this 
amendment, the Treasury Department and the IRS intend to remove 
references to the residency requirement in the proposed regulations 
under section 529A when those regulations are finalized. The other 
statutory change was made in the 2017 Act as described in these 
proposed regulations.

3. The 2017 Act

    The 2017 Act amended section 529A(b)(2)(B) to allow an employed 
designated beneficiary described in new section 529A(b)(7) to 
contribute, prior to January 1, 2026, an additional amount in excess of 
the limit in section 529A(b)(2)(B)(i) (the annual gift tax exclusion 
amount in section 2503(b), formerly set forth in section 
529A(b)(2)(B)). This additional permissible contribution is subject to 
its own limit as described in section 529A(b)(2)(B)(ii). Specifically, 
this additional contributed amount may not exceed the lesser of (i) the 
designated beneficiary's compensation as defined by section 219(f)(1) 
for the taxable year, or (ii) an amount equal to the poverty line for a 
one-person household for the calendar year preceding the calendar year 
in which the taxable year begins. The 2017 Act also amended the section 
529A(b)(2) flush language to require the designated beneficiary, or a 
person acting on behalf of the designated beneficiary, to maintain 
adequate records to ensure, and to be responsible for ensuring, that 
the requirements of section 529A(b)(2)(B)(ii) are met.
    New section 529A(b)(7)(A) identifies a designated beneficiary 
eligible to make this additional contribution as one who is an employee 
(including a self-employed individual) with respect to whom there has 
been no contribution made for the taxable year to: a defined 
contribution plan meeting the requirements of sections 401(a) or 
403(a); an annuity contract described in section 403(b); or an eligible 
deferred contribution plan under section 457(b). Section 529A(b)(7)(B) 
defines the term ``poverty line'' as having the meaning provided in 
section 673 of the Community Services Block Grant Act (42 U.S.C. 9902).
    The 2017 Act also amended section 529 to allow, before January 1, 
2026, a limited amount to be rolled over to an ABLE account from the 
designated beneficiary's own section 529 qualified tuition program 
(QTP) account or from the QTP account of certain family members. The 
2017 Act added section 529(c)(3)(C)(i)(III), which provides that a 
distribution from a QTP made after December 22, 2017, and before 
January 1, 2026, is not subject to income tax if,

[[Page 54531]]

within 60 days of the distribution, it is transferred to an ABLE 
account of the designated beneficiary or a member of the family of the 
designated beneficiary. Under section 529(c)(3)(C)(i), the amount of 
any rollover to an ABLE account is limited to the amount that, when 
added to all other contributions made to the ABLE account for the 
taxable year, does not exceed the contribution limit for the ABLE 
account under section 529A(b)(2)(B)(i), that is, the annual gift tax 
exclusion amount under section 2503(b). This limited rollover is 
described in more detail in Notice 2018-58, 2018-33 I.R.B. 305 (Aug. 
13, 2018).

4. Notice 2018-62

    To address the 2017 Act modifications to section 529A, the Treasury 
Department and the IRS published Notice 2018-62, 2018-34 I.R.B. 316 
(Aug. 20, 2018), which announces the intent of the Treasury Department 
and the IRS to issue proposed regulations to implement these changes, 
and describes the anticipated rules to implement the statutory changes. 
No comments were received in response to the Notice. These proposed 
regulations incorporate, without substantive change, the anticipated 
rules described in that Notice.

Explanation of Provisions

1. Additional Contributions

    The 2017 Act amended section 529A(b)(2)(B) to permit an employed or 
self-employed designated beneficiary described in section 529A(b)(7) to 
contribute to his or her ABLE account the lesser of the designated 
beneficiary's compensation for the taxable year or an amount equal to 
the poverty line for a one-person household for the calendar year 
preceding the calendar year in which the designated beneficiary's 
taxable year begins. These proposed regulations confirm that the 
employed designated beneficiary, or the person acting on his or her 
behalf, is solely responsible for ensuring that the requirements in 
section 529A(b)(2)(B)(ii) are met and for maintaining adequate records 
for that purpose. In addition, to minimize burdens for the designated 
beneficiary and the qualified ABLE program, these proposed regulations 
provide that ABLE programs may allow a designated beneficiary or the 
person acting on his or her behalf to certify, under penalties of 
perjury, that he or she is a designated beneficiary described in 
section 529A(b)(7) and that his or her contributions of compensation do 
not exceed the limit set forth in section 529A(b)(2)(B)(ii).

2. Poverty Line

    Section 529A(b)(7)(B) provides that the term poverty line referred 
to in section 529A(b)(2)(B)(ii) has the same meaning given to that term 
by section 673 of the Community Services Block Grant Act (42 U.S.C. 
9902). These proposed regulations clarify that the poverty line in 
section 529A(b)(7)(B) is to be determined by using the poverty 
guidelines updated periodically in the Federal Register by the U.S. 
Department of Health and Human Services under the authority of 42 
U.S.C. 9902(2). Those guidelines vary based on locality. Specifically, 
there are separate guidelines for (1) the contiguous 48 states and the 
District of Columbia, (2) Alaska, and (3) Hawaii. Because the Treasury 
Department and the IRS have concluded that the poverty guideline that 
most closely reflects the employed designated beneficiary's cost of 
living is the most relevant for determining the contribution limit, 
these proposed regulations provide that a designated beneficiary's 
contribution limit is to be determined using the poverty guideline 
applicable in the state of the designated beneficiary's residence.

3. Return of Excess Contributions

    Because section 529A(b)(2) provides that rules similar to those set 
forth in section 408(d)(4) regarding the return of excess contributions 
to an individual retirement account or annuity apply to ABLE accounts, 
these proposed regulations provide that a qualified ABLE program must 
return any contributions of the designated beneficiary's compensation 
in excess of the limit in section 529A(b)(2)(B)(ii) to the designated 
beneficiary.
    Consistent with section 529A(b)(2), these proposed regulations 
provide that it will be the sole responsibility of the designated 
beneficiary (or the person acting on the designated beneficiary's 
behalf) to identify and request the return of any excess contribution 
of such compensation income. Such returns of excess compensation 
contributions must be received by the employed designated beneficiary 
on or before the due date (including extensions) of the designated 
beneficiary's income tax return for the year in which the excess 
compensation contributions were made. A failure to return excess 
contributions within this time period will result in the imposition on 
the designated beneficiary of a 6 percent excise tax under section 
4973(a)(6) on the amount of excess compensation contributions.
    Additionally, in order to minimize administrative burdens for the 
designated beneficiary and the qualified ABLE program, for purposes of 
ensuring that the limit on contributions made under section 
529A(b)(2)(B)(ii) is not exceeded, the qualified ABLE program may rely 
on self-certifications, made under penalties of perjury, of the 
designated beneficiary or the person acting on the designated 
beneficiary's behalf.

Proposed Effective/Applicability Date

    These regulations are proposed to apply to taxable years beginning 
after the date of publication of the Treasury decision adopting these 
rules as final regulations in the Federal Register. Until the issuance 
of final regulations, taxpayers and qualified ABLE programs may rely on 
these proposed regulations.

Special Analyses

    This regulation is not subject to review under section 6(b) of 
Executive Order 12866 pursuant to the Memorandum of Agreement (April 
11, 2018) between the Department of the Treasury and the Office of 
Management and Budget regarding review of tax regulations.

Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it 
is hereby certified that the collection of information in these 
regulations will not have a significant economic impact on a 
substantial number of small entities. This certification is based on 
the fact that these proposed regulations will not impact a substantial 
number of small entities. These regulations primarily affect states and 
individuals and therefore will not have a significant economic impact 
on a substantial number of small entities. Pursuant to section 7805(f) 
of the Code, these proposed regulations will be submitted to the Chief 
Counsel for Advocacy of the Small Business Administration for comment 
on their impact on small business.

Comments and Requests for Public Hearing

    Before these proposed regulations are adopted as final regulations, 
consideration will be given to any comments that are timely submitted 
to the IRS as prescribed in this preamble under the ADDRESSES heading. 
The Treasury Department and the IRS request comments on all aspects of 
these proposed rules. All comments will be available at 
www.regulations.gov or upon request. A public hearing will be scheduled 
if requested in writing by any

[[Page 54532]]

person that timely submits written or electronic comments. If a public 
hearing is scheduled, notice of the date, time, and place for the 
hearing will be published in the Federal Register.

Statement of Availability of IRS Documents

    Notices 2015-81, 2018-58 and 2018-62 are published in the Internal 
Revenue Bulletin and are available from the Superintendent of 
Documents, U.S. Government Publishing Office, Washington, DC 20402, or 
by visiting the IRS website at http://www.irs.gov.

Drafting Information

    The principal author of these regulations is Julia Parnell, Office 
of Associate Chief Counsel (Employee Benefits, Exempt Organizations, 
and Employment Taxes). However, other personnel from the IRS and the 
Treasury Department participated in their development.

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Proposed Amendments to the Regulations

    Accordingly, 26 CFR part 1 is proposed to be amended as follows:

PART 1--INCOME TAXES

0
Paragraph 1. The authority citation for part 1 is amended by adding an 
entry for Sec.  1.529A-8 in numerical order to read in part as follows:

    Authority: 26 U.S.C. 7805 * * *
* * * * *
    Section 1.529A-8 also issued under 26 U.S.C. 529A(g).
* * * * *
0
Par. 2. Section 1.529A-0, as proposed to be added at 80 FR 35602, June 
22, 2015, is further amended by adding an entry for Sec.  1.529A-8 in 
numerical order to read as follows:


Sec.  1.529A-0  Table of contents.

* * * * *


Sec.  1.529A-8  Additional contributions to ABLE accounts made by an 
employed designated beneficiary.

    (a) Additional contributions to ABLE accounts made by an employed 
designated beneficiary.
    (1) In general.
    (2) Amount of additional contribution.
    (b) Additional definitions.
    (1) Employed designated beneficiary.
    (2) Applicable poverty line.
    (3) Excess compensation contribution.
    (c) Example.
    (d) Responsibility for ensuring contribution limit is met.
    (e) Return of excess compensation contributions.
    (f) Applicability date.

0
Par.3. Section 1.529A-1, as proposed to be added at 80 FR 35602, June 
22, 2015, is further amended by revising paragraph (b)(3) to read as 
follows:


Sec.  1.529A-1  Exempt status of qualified ABLE program and 
definitions.

* * * * *
    (b) * * *
    (3) Contribution means any payment directly allocated to an ABLE 
account for the benefit of the designated beneficiary, including 
amounts transferred from a qualified tuition program under section 529 
after December 22, 2017 and before January 1, 2026.
* * * * *
0
Par. 4. Section 1.529A-8 is added to read as follows:


Sec.  1.529A-8  Additional contributions to ABLE accounts made by an 
employed designated beneficiary.

    (a) Additional contributions by an employed designated 
beneficiary--(1) In general. An employed designated beneficiary defined 
in paragraph (b)(1) of this section may contribute amounts up to the 
limit specified in paragraph (a)(2) of this section in addition to the 
annual amount described in section 529A(b)(2)(B)(i).
    (2) Amount of additional permissible contribution. Any additional 
contribution made by the designated beneficiary pursuant to this 
section is limited to the lesser of--
    (i) The designated beneficiary's compensation as defined by section 
219(f)(1) for the taxable year; or
    (ii) An amount equal to the applicable poverty line, as defined in 
paragraph (b)(2) of this section, for a one-person household for the 
calendar year preceding the calendar year in which the designated 
beneficiary's taxable year begins.
    (b) Additional definitions. In addition to the definitions in Sec.  
1.529A-1(b), the following definitions also apply for the purposes of 
this section--
    (1) Employed designated beneficiary means a designated beneficiary 
who is an employee (including an employee within the meaning of section 
401(c)), with respect to whom no contribution is made for the taxable 
year to--
    (i) A defined contribution plan (within the meaning of section 
414(i)) with respect to which the requirements of sections 401(a) or 
403(a) are met;
    (ii) An annuity contract described in section 403(b); and
    (iii) An eligible deferred compensation plan described in section 
457(b).
    (2) Applicable poverty line means the amount provided in the 
poverty guidelines updated periodically in the Federal Register by the 
U.S. Department of Health and Human Services under the authority of 42 
U.S.C. 9902(2) for the State of residence of the employed designated 
beneficiary. If the designated beneficiary lives in more than one state 
during the taxable year, the applicable poverty line is the poverty 
line for the state in which the designated beneficiary resided longer 
than in any other state during that year.
    (3) Excess compensation contribution means the amount by which the 
amount contributed during the taxable year of an employed designated 
beneficiary to the designated beneficiary's ABLE account exceeds the 
limit in effect under section 529A(b)(2)(B)(ii) and paragraph (a)(2) of 
this section for the calendar year in which that taxable year of the 
employed designated beneficiary begins.
    (c) Example. The following example illustrates the principles of 
paragraphs (a)(2) and (b)(2) of this section. In 2019, A, the 
designated beneficiary of an ABLE account, lives in Hawaii. A's 
compensation, as defined by section 219(f)(1), for 2019 is $20,000. The 
poverty line for a one-person household in Hawaii was $13,960 in 2018. 
Because A's compensation exceeded the applicable poverty line amount, 
A's additional permissible contribution in 2019 is limited to $13,960, 
the amount of the 2018 applicable poverty line.
    (d) Responsibility for ensuring contribution limit is met. (1) The 
employed designated beneficiary, or the person acting on his or her 
behalf, is solely responsible for ensuring that the requirements in 
section 529A(b)(2)(B)(ii) and paragraph (a)(2) of this section are met 
and for maintaining adequate records for that purpose.
    (2) A qualified ABLE program may allow a designated beneficiary (or 
the person acting on his or her behalf) to certify, under penalties of 
perjury, and in the manner specified by the qualified ABLE program 
that--
    (i) The designated beneficiary is an employed designated 
beneficiary; and
    (ii) The designated beneficiary's contributions of compensation are 
not excess compensation contributions.
    (e) Return of excess compensation contributions. If an excess 
compensation contribution is deposited into or allocated to the ABLE 
account of a designated beneficiary, the qualified ABLE program must 
return that excess contribution, including all net income

[[Page 54533]]

attributable to the excess contribution, as determined under the rules 
set forth in Sec.  1.408-11 (treating references to an IRA as 
references to an ABLE account, and references to returned contributions 
under section 408(d)(4) as references to excess compensation 
contributions), to the employed designated beneficiary. The employed 
designated beneficiary, or the person acting on the employed designated 
beneficiary's behalf, is responsible for identifying any excess 
compensation contribution and for requesting the return of the excess 
compensation contribution. The excess compensation contribution, if 
requested, must be received by the employed designated beneficiary on 
or before the due date (including extensions) of the Federal income tax 
return of the employed designated beneficiary for the taxable year in 
which the excess compensation contribution is made.
    (f) Applicability date. The rules of this section apply to taxable 
years beginning after [DATE OF PUBLICATION OF FINAL REGULATIONS IN THE 
Federal Register].

Kirsten Wielobob,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 2019-21477 Filed 10-9-19; 8:45 am]
BILLING CODE 4830-01-P