SUPPORTING STATEMENT
(Rev. Proc. 2006-31)
OMB # 1545-2018
CIRCUMSTANCES NECESSITATING COLLECTION OF INFORMATION
Section 83(a) of the Internal Revenue Code generally provides that if, in connection
with the performance of services, property is transferred to any person other than
the person for whom such services are performed, then, the excess of the fair
market value of the property as of the first day that the transferee's rights in the
property are transferable or not subject to a substantial risk of forfeiture, whichever
occurs earlier, over the amount paid for the property is included in the service
provider's gross income.
Under § 83(b), the service provider may elect to include as compensation for
services at the time of transfer, the excess of the fair market value of the property
over the amount paid for the property. If this election is made, the substantial
vesting rules of § 83(a) do not apply to the property, and, generally any subsequent
appreciation in the value of the property is not taxable as compensation to the
service provider.
Section 83(b)(2) provides that an election under § 83(b) may not be revoked without the consent of the Commissioner. Section 1.83-2(f) of the Income Tax Regulations provides that consent to revoke the election will only be granted where the transferee is under a mistake of fact as to the underlying transaction and the request is made within 60 days of the discovery of the mistake of fact. In order for the Internal Revenue Service to determine whether consent to revoke the election should be granted, it is necessary for the applicant to submit a request for a private letter ruling. This revenue procedure addresses the information needed by the Service to determine whether revocation is appropriate.
USE OF DATA
The information will be used by the Service to determine whether permission to revoke the election should be granted.
USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE BURDEN
IRS Publications, Regulations, Notices and Letters are to be electronically enabled
on an as practicable basis in accordance with the IRS Reform and Restructuring Act
of 1998.
EFFORTS TO IDENTIFY DUPLICATION
We have attempted to eliminate duplication within the agency wherever possible.
METHODS TO MINIMIZE BURDEN ON SMALL BUSINESSES OR OTHER SMALL ENTITIES
There are no small entities affected by this collection.
CONSEQUENCES OF LESS FREQUENT COLLECTION ON FEDERAL PROGRAMS OR POLICY ACTIVITIES
If the IRS did not collect this information, the IRS would not be able to determine whether permission to revoke the election should be granted.
SPECIAL CIRCUMSTANCES REQUIRING DATA COLLECTION TO BE INCONSISTENT WITH THE GUIDELINES IN 5 CFR 1320.5(d)(2)
There are no special circumstances requiring data collection to be inconsistent with Guidelines in 5 CFR 1320.5(d)(2).
CONSULTATION WITH INDIVIDUALS OUTSIDE OF THE AGENCY ON AVAILABILITY OF DATA, FREQUENCY OF COLLECTION, CLARITY OF INSTRUCTIONS AND FORMS, AND DATA ELEMENTS
Revenue Procedure 2006-31 was published in the Internal Revenue Bulletin
(2006-27 I.R.B. 32), on July 3, 2006.
In response to the Federal Register notice dated January 20, 2016 (81 FR 3239), we received no comments during the comment period regarding Rev. Proc.
2006-31.
EXPLANATION OF DECISION TO PROVIDE ANY PAYMENT OR GIFT TO RESPONDENTS
No payment or gift has been provided to any respondents.
10. ASSURANCE OF CONFIDENTIALITY OF RESPONSES
Generally, tax returns and return information are confidential as required by 26 USC 6103.
11. JUSTIFICATION OF SENSITIVE QUESTIONS
No personally identifiable information (PII) is collected.
12. ESTIMATED BURDEN OF INFORMATION COLLECTION
Section 4 of the revenue procedure requires the applicant to submit a private letter ruling request in accordance with Rev. Proc. 2006-1 (or its successor).
The total estimated average annual burden varies from 1 hour to 5 hours with a total estimated average burden of 2 hours on 200 respondents for a total of 400 hours annually.
Estimates of the annualized cost to respondents for the hour burdens shown are not available at this time.
13. ESTIMATED TOTAL ANNUAL COST BURDEN TO RESPONDENTS
There are no start-up costs associated with this collection.
14. ESTIMATED ANNUALIZED COST TO THE FEDERAL GOVERNMENT
There are no known annualized costs to the federal government.
15. REASONS FOR CHANGE IN BURDEN
There is no change in the paperwork burden previously approved by OMB. We are
making this submission to renew the OMB approval.
16. PLANS FOR TABULATION, STATISTICAL ANALYSIS AND
PUBLICATION
There are no plans for tabulation, statistical analysis and publication.
17. REASONS WHY DISPLAYING THE OMB EXPIRATION DATE IS
INAPPROPRIATE
We believe that displaying the OMB expiration date is inappropriate because it could cause confusion by leading taxpayers to believe that the revenue procedure sunsets as of the expiration date. Taxpayers are not likely to be aware that the Service intends to request renewal of the OMB approval and obtain a new expiration date before the old one expires.
18. EXCEPTIONS TO THE CERTIFICATION STATEMENT
There are no exceptions to the certification statement for this collection.
Note: The following paragraph applies to all collections of information in this submission:
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 the collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential as required by 26 U.S.C. § 6103.
| File Type | application/msword |
| File Title | SUPPORTING STATEMENT |
| Author | MARubi00 |
| Last Modified By | Department of Treasury |
| File Modified | 2016-02-29 |
| File Created | 2016-02-26 |