Supporting Statement

Supporting Statement

OMB #1545-2070

Revenue Procedure 2007-48 --Consent of the Commissioner of Internal

Revenue to change to the safe harbor method of accounting.

Form 3115 –Application for Change in Accounting Method

1. Circumstances necessitating collection of information

Revenue Procedure 2007-48

The collection of information described in section 5 of the revenue procedure is necessary to support the requested change in method of accounting and to compute the adjustment required under § 481(a) to effect the change.

Form 3115

Section 446(e) of the Internal Revenue Code provides that a taxpaying entity that changes its method of accounting for computing taxable income must first secure the consent of the Secretary. Form 3115 is used by the taxpayer for obtaining this consent.

2. Use of data

The information will be used by the Internal Revenue Service to verify a taxpayer’s eligibility to use the safe harbor method and the computation of the adjustment.

3. Use of improved information technology to reduce burden

There are no plans to provide electronic filing because electronic filing is not appropriate for the collection of information in this submission.

4. Efforts to identify duplication

We have attempted to eliminate duplication within the agency wherever possible.

5. methods to minimize burden on small businesses or other small entities

The collection of information does not have a significant impact on a substantial number of small businesses.

6. CONSEQUENCES OF LESS FREQUENT COLLECTION ON FEDERAL PROGRAMS OR POLICY ACTIVITIES

We ask for the information to carry out the Internal Revenue laws of the United States. We need it to ensure taxpayers are complying with the laws, and to allow us to figure and collect the right amount of tax.

The collection of information described in section 5 of the revenue procedure is necessary to support the requested change in method of accounting and to compute the adjustment required under § 481(a) to effect the change.

Therefore, a less frequent collection is not practical.

7. SPECIAL CIRCUMSTANCES REQUIRING DATA COLLECTION TO BE INCONSISTENT WITH 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).

8. CONSULTATION WITH INDIVIDUALS OUTSIDE OF THE AGENCY ON AVAILABILITY OF DATA, FREQUENCY OF COLLECTION, CLARITY OF INSTRUCTIONS AND FORMS, AND DATA ELEMENTS

Periodic meetings are held between IRS personnel and representatives of the American Bar association, the National Society of Public Accountants, the American Institute of Certified Public Accountants, and other professional groups to discuss tax law and tax forms. During these meetings, there is an opportunity for those attending to make comments regarding Form 3115.

In response to the Federal Register Notice dated February 15, 2017, (82 FR 10852), we received no comments during the comment period.

9. EXPLANATION OF DECISION TO PROVIDE ANY PAYMENT OR GIFT TO RESPONDENTS

No payments or gifts are being provided.

10. ASSURANCE OF CONFIDENTIALITY OF RESPONSES

Generally, tax return information is confidential as required by 26 USC 6103.

11. JUSTIFICATION OF SENSITIVE QUESTIONS

A privacy impact assessment (PIA) has been conducted for information collected under this request as part of the “Business Master File (BMF)” system and a Privacy Act System of Records notice (SORN) has been issued for this system under IRS 24.046-Customer Account Data Engine Business Master File. The Internal Revenue Service PIAs can be found at http://www.irs.gov/uac/Privacy-Impact-Assessments-PIA.

Title 26 USC 6109 requires inclusion of identifying numbers in returns, statements, or other documents for securing proper identification of persons required to make such returns, statements, or documents and is the authority for social security numbers (SSNs) in IRS systems.

12. ESTIMATED BURDEN OF INFORMATION COLLECTION

The collection of information in Revenue Procedures 2007-48 is in section 5.04(1).This information is required to determine whether the taxpayer qualifies to use the safe harbor method of accounting. The collection of information is required to obtain a benefit. The likely respondents are business or other for-profit institutions.

Reporting Burden Associated with Revenue Procedure 2007-48:

Total Respondents	Time Per Respondent	Total Burden
300	¼ hour	75 hours

Reporting Burden Associated with Form 3115

Total Respondents	Time Per Respondent	Total Burden
300	96.98	29,094

13. ESTIMATED TOTAL ANNUAL COSTBURDEN TO RESPONDENTS

As suggested by OMB, our Federal Register notice dated February 15, 2017, (82 FR 10852) requested public comments on estimates of cost burden that are not captured in the estimates of burden hours, i.e., estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information. However, we did not receive any responses from taxpayers on this subject. As a result, estimates of these cost burdens are not available at this time.

14. ESTIMATED ANNUALIZED COST TO THE FEDERAL GOVERNMENT

The primary cost to the government consists of the cost of printing this form. We estimate that the cost of printing the form is $17,649.

15. REASONS FOR PROGRAM CHANGES OR ADJUSTMENTS

The number of responses previous approved by OMB is adjusted for Schedules A, B, C, D, E.

We are consolidating the ICR for Form 3115 with this ICR for Revenue Procedure 2007-48.

Therefore, OMB control number 1545-0152 will be discontinued.

Going forward, the OMB control number posted on the Form 3115 will be 1545-2070.

We are making this submission to renew the OMB approval.

16. PLANS FOR TABULATION, STATISTICAL ANALYSIS AND PUBLICATION

There are no plans for tabulation.

17. REASONS WHY DISPLAYING THE OMB EXPIRATION DATE IS INAPPROPRIATE

We believe the public interest will be better served by not printing an expiration date on the form(s) in this package.

Printing the expiration date on the form will result in increased costs because of the need to replace inventories that become obsolete by passage of the expiration date each time OMB approval is renewed. Without printing the expiration date, supplies of the form could continue to be used.

The time period during which the current edition of the form(s) in this package will continue to be usable cannot be predicted. It could easily span several cycles of review and OMB clearance renewal. In addition, usage fluctuates unpredictably. This makes it necessary to maintain a substantial inventory of forms in the supply line at all times. This includes supplies owned by both the Government and the public. Reprinting of the form cannot be reliably scheduled to coincide with an OMB approval expiration date. This form may be privately printed by users at their own expense. Some businesses print complex and expensive marginally punched continuous versions, at their expense, for use in their computers. The form may be printed by commercial printers and stocked for sale. In such cases, printing the expiration date on the form could result in extra costs to the users.

Not printing the expiration date on the form(s) will also avoid confusion among taxpayers who may have identical forms with different expiration dates in their possession.

For the above reasons we request authorization to omit printing the expiration date on the form(s) in this package.

18. EXCEPTION TO THE CERTIFICATION STATEMENT

No exceptions.

Note: The following paragraph applies to all of the 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 a 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.