Internal Revenue Service April 11, 2005 – Federal Register Recent Federal Regulation Documents

In the Rules and Regulations section of this issue of the Federal Register, the IRS is issuing temporary regulations that provide rules under section 937(a) of the Internal Revenue Code (Code) for determining whether an individual is a bona fide resident of the following U.S. possessions: American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the United States Virgin Islands. The temporary regulations also provide rules under section 937(b) for determining whether income is derived from sources within a U.S. possession and whether income is effectively connected with the conduct of a trade or business within a U.S. possession. Section 937 was added to the Code by section 908 of the American Jobs Creation Act of 2004 (2004 Act). The temporary regulations also provide updated guidance under sections 1, 876, 881, 884, 931, 932, 933, 934, 935, 957, and 6688 of the Code to reflect amendments made by the Tax Reform Act of 1986 (1986 Act) and the 2004 Act. Conforming changes are also made to regulations under sections 170A, 861, 871, 901, 1402, 6038, 6046, and 7701 of the Code. The text of the temporary regulations on this subject in this issue of the Federal Register also generally serves as the text of these proposed regulations set forth in this cross-referenced notice of proposed rulemaking. This notice of proposed rulemaking also contains proposed regulations that are in addition to the text of the temporary regulations. These provisions that are issued only as proposed regulations contain additional conforming changes to the regulations under sections 1, 861, 871, and 7701.