Ann 2001-1

Bulletin No. 2001–2
January 8, 2001

Internal Revenue

bulletin
HIGHLIGHTS
OF THIS ISSUE

These synopses are intended only as aids to the reader in
identifying the subject matter covered. They may not be
relied upon as authoritative interpretations.

INCOME TAX
Rev. Rul. 2001–2, page 255.
Low-income housing credit; satisfactory bond; “bond
factor” amounts for the period October through
December 2000. This ruling announces the monthly bond
factor amounts to be used by taxpayers who dispose of qualified low-income buildings or interests therein during the period October through December 2000. This ruling also
announces errors in bond factor amounts for dispositions of
1987 properties in 1998 and of all properties in 1999 and
January through June 2000, and sets forth summaries for
1998, 1999, and 2000 that contain the corrected bond factor amounts.

Notice 2001–2, page 265.
Research credit suspension periods. This notice provides guidance to help taxpayers compute and report their
credit for increasing research activities (research credit)
under section 41 of the Code for taxable years that include
the research credit suspension periods described in section
502(d)(2) of the Tax Relief Extension Act of 1999, Pub. L.
No. 106-170 (Dec. 17, 1999). This notice also explains how
to take into account any research credits attributable to a
research credit suspension period.

his discretion to except a qualifying taxpayer with average
annual gross receipts of $1,000,000 or less from the
requirements to use an accrual method of accounting and to
account for inventories. Rev. Proc. 2000–22 modified and
superseded. Rev. Proc. 99–49 modified and amplified.

Rev. Proc. 2001–11, page 275.
Penalties; substantial understatement. Guidance is provided concerning when information shown on a return will be
adequate disclosure for purposes of reducing an understatement of income tax under section 6662(d) of the Code
and for purposes of avoiding the preparer penalty under section 6694(a) of the Code.

EMPLOYEE PLANS
Notice 2001–3, page 267.
Weighted average interest rate update. The weighted
average interest rate for December 2000 and the resulting
permissible range of interest rates used to calculate current
liability for purposes of the full funding limitation of section
412 (c)(7) of the Code are set forth.

EMPLOYMENT TAX

Notice 2001–4, page 267.
This notice provides additional guidance to qualified intermediaries and U.S. withholding agents relating to the withholding of income tax under section 1441 of the Code on
certain U.S. source income paid to foreign persons.

Rev. Proc. 2001–10, page 272.
Methods of accounting; inventories; small taxpayers.
This procedure provides that the Commissioner will exercise

T.D. 8910, page 258.
Final regulations under section 6053 of the Code set forth
rules for employers that wish to establish electronic systems
for use by their tipped employees in reporting tips to the
employer. The regulations also provide rules relating to substantiation requirements for tipped employees using the
electronic system.

(Continued on the next page)

Finding Lists begin on page ii.

Department of the Treasury
Internal Revenue Service

Notice 2001–1, page 261.

Announcement 2001–3, page 278.

This notice sets forth the requirements employers must
meet and the procedures for obtaining approval of employer-designed tip reporting alternative commitment (EmTRAC)
programs for the food and beverage industry. Notice
2000–21 superseded.

This announcement updates Publication 1187 (Rev. 8-98),
which provides specifications for the magnetic or electronic filing of Form 1042-S, Foreign Person’s U.S. Source Income
Subject to Withholding. Announcement 99–79 superseded.

Page 258.

This document contains corrections to T.D. 8889, 2000–30
I.R.B. 124, final regulations regarding claims for certain
income tax convention benefits.

Railroad retirement; rate determination; quarterly. The
Railroad Retirement Board has determined that the rate of
tax imposed by section 3221 of the Code shall be 26 cents
for the quarter beginning January 1, 2001.

Announcement 2001–1, page 277.
The Service announces the availability of two new pro forma
voluntary tip reporting agreements for employers of tipped
employees and revisions of three existing pro forma voluntary tip reporting agreements. These documents were published in proposed form as announcements in I.R.B.
2000–19.

Announcement 2001–4, page 286.

Announcement 2001–5, page 286.
This document contains corrections to the Numerical Finding
List, the Finding List of Current Actions on Previously
Published Items, and the Index for Cumulative Bulletin
1998–2. These pages are reprinted here.

ADMINISTRATIVE
Announcement 2001–2, page 277.
An updated edition of Publication 551, Basis of Assets
(revised December 2000), will be available soon.

January 8, 2001

2001–2 I.R.B.