Transitional Guidance Under Sections 162(f) and 6050X with Respect To Certain Fines, Penalties, and Other Amounts

ICR 201911-1545-005

OMB: 1545-2284

Federal Form Document

Forms and Documents
Document
Name
Status
Supporting Statement A
2019-11-19
IC Document Collections
IC ID
Document
Title
Status
234021 Modified
ICR Details
1545-2284 201911-1545-005
Active 201811-1545-005
TREAS/IRS
Transitional Guidance Under Sections 162(f) and 6050X with Respect To Certain Fines, Penalties, and Other Amounts
Revision of a currently approved collection   No
Regular
Approved without change 01/31/2020
Retrieve Notice of Action (NOA) 12/30/2019
  Inventory as of this Action Requested Previously Approved
01/31/2023 36 Months From Approved 01/31/2020
47,200 0 200
5,664 0 24
0 0 0

The collection covers the new information reporting requirements under IRC 162(f) and new 6050X, which was added by the Tax Cuts and Jobs Act (TCJA). Generally, no deduction is allowed for any amount paid to, or at the direction of, a government or specified nongovernmental entity for the violation of any law. The general rule does not apply to the following exceptions: • Amounts that constitute restitution (including remediation of property); • Amounts paid to come into compliance with the law; • Amounts paid or incurred as the result of certain court orders in which no government or specified nongovernmental agency is a party; and • Amounts paid or incurred for taxes due. To be deductible under an exception, the Taxpayer must establish that an amount required to be paid is for restitution, remediation or to come into compliance with the law, AND the amount must be specifically identified in the settlement agreement or court order as restitution, remediation or to come into compliance with the law. Any amount paid or incurred as reimbursement to the Government for the costs of any investigation or litigation are not deductible under one of the exceptions (under prior law, these amounts were often considered compensatory and deductible). The 2017 Tax Cuts and Jobs Act also enacted IRC section 6050X, which requires government agencies or specified nongovernmental regulatory entities to file an information return which identifies: 1. The amount required to be paid as a result of the suit or agreement to which IRC section 162(f)(1) applies; 2. Any amount required to be paid as a result of the suit or agreement that constitutes restitution or remediation of property; and 3. Any amount required to be paid as a result of the suit or agreement for the purpose of coming into compliance with any law that was violated or involved in the investigation or inquiry. This reporting requirement will not be required with respect to amounts paid or incurred under a binding court order or agreement entered into before the date provided in the future proposed regulations, which will be no earlier than January 1, 2019. Notice 2018-23 provides information for section 6050X and transitional guidance under IRC § 162(f).

PL: Pub.L. 115 - 97 13306 Name of Law: Tax Cuts and Jobs Act
  
PL: Pub.L. 115 - 97 13306 Name of Law: Tax Cuts and Jobs Act

Not associated with rulemaking

  84 FR 45834 08/30/2019
84 FR 72141 12/30/2019
No

1
IC Title Form No. Form Name
Section 6050X- Reporting 1098-F Fines, Penalties, and Other Amounts

  Total Approved Previously Approved Change Due to New Statute Change Due to Agency Discretion Change Due to Adjustment in Estimate Change Due to Potential Violation of the PRA
Annual Number of Responses 47,200 200 0 0 47,000 0
Annual Time Burden (Hours) 5,664 24 0 0 5,640 0
Annual Cost Burden (Dollars) 0 0 0 0 0 0
No
No
The Treasury Department and the IRS intend to issue proposed regulations (1545-BO67), amending and adding sections to the Income Tax Regulations with respect to sections 162(f) and 6050X. To assist in the development of the proposed regulations, the IRS has requests comments from the public and affected governments and nongovernmental entities, on any and all issues related to the application and implementation of sections 162(f) and 6050X that the proposed regulations should address. Updated filing figures indicate an increase in the estimated annual responses by 47,000. This increase will result in a total estimated annual burden increase of 5,640 hours. This submission is being made to revise and extend the current approval as required in the Paperwork Reduction Act.

$75,866
No
    Yes
    Yes
No
No
No
Uncollected
Christopher Wrobel 202 317-4612 [email protected]

  No

On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).
The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:
 
 
 
 
 
 
 
    (i) Why the information is being collected;
    (ii) Use of information;
    (iii) Burden estimate;
    (iv) Nature of response (voluntary, required for a benefit, or mandatory);
    (v) Nature and extent of confidentiality; and
    (vi) Need to display currently valid OMB control number;
 
 
 
If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.
12/30/2019


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