Rp 2006-21

26 CFR 601.201: Ruling and determination letters.
(Also Part I, §§ 1502, 1504; 1.1502–33, 1.1502–75,
1.1502–76, 1.1504–1.)

Rev. Proc. 2006–21
SECTION 1. PURPOSE
This revenue procedure modifies Rev.
Proc. 89–56, 1989–2 C.B. 643, Rev. Proc.
90–39, 1990–2 C.B. 365, and Rev. Proc.
2002–32, 2002–1 C.B. 959, to eliminate
impediments to the electronic filing of
Federal income tax returns (e-filing) and
to reduce the reporting requirements in
each of these revenue procedures.
SECTION 2. BACKGROUND
.01 Rev. Proc. 89–56, Rev. Proc.
90–39, and Rev. Proc. 2002–32 each provide a means for a consolidated group to
obtain a specified consent or waiver from
the Commissioner without requesting a
private letter ruling. The revenue procedures each provide that, in order to obtain
the subject consent or waiver, a statement
containing specified information must be
included on or with the group’s return.
The Internal Revenue Service has concluded that the amount of information
required to be included in these statements
is greater than is necessary to facilitate the
administration of the tax law. Moreover,
each of these statements presents an impediment to e-filing.
.02 Rev. Proc. 89–56 provides a means
for a consolidated group to obtain the
Commissioner’s consent to file a consolidated Federal income tax return in which
one or more members of the group use
a 52–53 week tax year. Section 3.01 of
the revenue procedure sets forth the information and representations that must
be provided in a statement included on or
with the group’s return in order to obtain
the consent. Section 3.02 requires the
statement to be signed under penalties of
perjury by a duly authorized officer of the
common parent.
.03 Rev. Proc. 90–39 provides a
means for a consolidated group to obtain
the Commissioner’s consent to elect or
change its method of allocating the consolidated Federal income tax liability to
its members for purposes of determining
the earnings and profits of each member.
Section 4.01 of the revenue procedure sets

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forth the information and representations
that must be provided in a statement included on or with the group’s return in
order to obtain the consent. Section 4.02
requires the statement to be signed under
penalties of perjury by a duly authorized
officer of the common parent.
.04 Rev. Proc 2002–32 provides a
means for a consolidated group to obtain
the Commissioner’s waiver of the prohibition against including a previously disaffiliated corporation in the group’s return
during the sixty-month period following
the disaffiliation. See § 1504(a)(3)(A) of
the Internal Revenue Code. Paragraphs
5.01 through 5.14 of the revenue procedure
set forth the information and representations that must be provided in a statement
included on or with the group’s return in
order to obtain the consent. In the unnumbered paragraph following the heading,
Section 5 requires the statement to be filed
under penalties of perjury.
SECTION 3. SCOPE
This revenue procedure applies to any
taxpayer that applies for a consent or
waiver under the provisions of Rev. Proc.
89–56, Rev. Proc. 90–39, or Rev. Proc.
2002–32.
SECTION 4. APPLICATION
.01 To remove e-filing impediments,
this revenue procedure eliminates the signature requirement of each of Rev. Proc.
89–56, Rev. Proc. 90–39, and Rev. Proc.
2002–32. Thus, the following provisions
of these revenue procedures are deleted:
section 3.02 of Rev. Proc. 89–56, section
4.02 of Rev. Proc. 90–39, and the clause,
“filed under penalties of perjury,” in the
second sentence in the unnumbered paragraph following the heading of Section 5
of Rev. Proc. 2002–32.
.02 To reduce the reporting requirements of Rev. Proc. 89–56, this revenue
procedure permits a consolidated group to
obtain consent under that revenue procedure by including the following statement
on or with its return in lieu of the statement
described in section 3.01 of Rev. Proc.
89–56: “THIS IS A REQUEST UNDER
REV. PROC. 89–56 TO USE A 52–53
WEEK TAX YEAR. THE GROUP HAS
COMPLIED, AND WILL CONTINUE
TO COMPLY, WITH THE CONDITIONS

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SET FORTH IN SECTION 3.01 OF REV.
PROC. 89–56.”
.03 To reduce the reporting requirements of Rev. Proc. 90–39, this revenue
procedure permits a consolidated group to
obtain consent under that revenue procedure by including the following statement
on or with its return in lieu of the statement described in section 4.01 of Rev.
Proc. 90–39: “THIS IS A REQUEST
UNDER REV. PROC. 90–39 TO ELECT
OR CHANGE THE METHOD OF ALLOCATING CONSOLIDATED FEDERAL INCOME TAX LIABILITY FOR
PURPOSES OF DETERMINING MEMBERS’ EARNINGS AND PROFITS.
THE GROUP HAS COMPLIED, AND
WILL CONTINUE TO COMPLY, WITH
THE CONDITIONS SET FORTH IN
SECTION 4.01 OF REV. PROC. 90–39.”
.04 To reduce the reporting requirements of Rev. Proc. 2002–32, this
revenue procedure permits a consolidated group to obtain a waiver under
that revenue procedure by including the
following statement on or with its return in lieu of the statement described
in section 5 of Rev. Proc. 2002–32:
“THIS IS A REQUEST UNDER REV.
PROC. 2002–32 FOR A WAIVER OF
SECTION 1504(a)(3)(A) FOR [INSERT
NAME AND EMPLOYER IDENTIFICATION NUMBER OF SUBSIDIARY].
THE GROUP HAS COMPLIED, AND
WILL CONTINUE TO COMPLY, WITH
THE CONDITIONS SET FORTH IN
SECTIONS 5.01 THROUGH 5.14 OF
REV. PROC. 2002–32.”
.05 Although paragraphs 4.02, 4.03,
and 4.04 of this revenue procedure reduce
the amount of information that a taxpayer
is required to include on or with its return,
the taxpayer’s recordkeeping requirement
remains unchanged. Taxpayers should
maintain records to establish the information described in Rev. Proc. 89–56
(Sec. 3.01), Rev. Proc. 90–39 (Sec. 4.01),
and 2002–32 (Secs. 5.01 through 5.14) in
order to substantiate their reporting positions. See § 1.6001–1(e) of the Procedure
and Administration Regulations.
SECTION 5. EFFECT ON OTHER
REVENUE PROCEDURES
Rev. Proc. 89–56, Rev. Proc. 90–39,
and Rev. Proc 2002–32 are modified. The
IRS and Treasury Department intend to

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modify Rev. Proc. 89–56 and Rev. Proc.
90–39 to reflect revisions to §§ 1.1502–13
and 1.1502–33 of the Income Tax Regulations. Until these revenue procedures are
so modified, taxpayers should continue to
apply the provisions of both revenue procedures in a manner that reflects the approach in the applicable regulations.
SECTION 6. EFFECTIVE DATE
This revenue procedure is effective on
May 26, 2006. However, taxpayers may
rely on this revenue procedure for prior
taxable years.

June 12, 2006

SECTION 7. PAPERWORK
REDUCTION ACT
The collections of information in this
revenue procedure have been previously
reviewed and approved by the Office of
Management and Budget (OMB) in accordance with the Paperwork Reduction Act
(44 U.S.C. 3507) under control number
1545–1784.
An agency may not conduct or sponsor,
and a person is not required to respond
to, a collection of information unless the
collection of information displays a valid
OMB control number.
Books or records relating to a collection
of information must be retained as long

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as their contents may be material in the
administration of any internal revenue tax
law. Generally tax returns and tax return
information are confidential, as required
by § 6103.
SECTION 8. DRAFTING
INFORMATION
The principal author of this revenue
procedure is Grid R. Glyer of the Office of
Associate Chief Counsel (Corporate). For
further information regarding this revenue
procedure, contact Grid R. Glyer at (202)
622–7930 (not a toll-free call).

2006–24 I.R.B.