Notice 2015-18

Part III. Administrative, Procedural, and Miscellaneous
Qualified ABLE Programs
Notice 2015–18
SECTION 1. PURPOSE
This notice provides advance notification of a provision anticipated to be included in the proposed regulations to be
issued under section 529A of the Internal
Revenue Code.
SECTION 2. BACKGROUND
The Stephen Beck, Jr., Achieving a
Better Life Experience Act of 2014
(ABLE Act) was enacted on December
19, 2014, as part of The Tax Increase
Prevention Act of 2014 (P.L. 113–295).
The ABLE Act creates a new section
529A of the Internal Revenue Code
(Code) that permits a state (or a state
agency or instrumentality) to establish and
maintain a new type of tax-advantaged
savings program, a qualified ABLE program, under which contributions may be
made to an account (an ABLE account)
that is established for the purpose of meeting the qualified disability expenses of the
designated beneficiary of the account who
is a resident of that state and who is disabled (as defined in section 529A). If a
state does not establish and maintain its
own qualified ABLE program, it may enter into a contract with another state in
order to provide its residents with access
to a qualified ABLE program. The statute
directs the Secretary of the Treasury or his
designee to issue regulations or other
guidance to implement section 529A no
later than June 19, 2015.
The Treasury Department and the Internal Revenue Service (IRS) have been
advised that several state legislatures currently are in the process of enacting enabling legislation in order to ensure that
their citizens may create ABLE accounts
during 2015. While the Treasury Department and the IRS currently are working
on section 529A guidance, it is anticipated
that ABLE programs may be in operation
in some states before such guidance can
be issued.
The Treasury Department and the IRS
do not want the lack of guidance to discourage states from enacting their en-

Bulletin No. 2015–12

abling legislation and creating their ABLE
programs, which could delay the ability of
the families of disabled individuals or others to begin to fund ABLE accounts for
those disabled individuals. Therefore, the
Treasury Department and the IRS are assuring states that enact legislation creating
an ABLE program in accordance with
section 529A, and those individuals establishing ABLE accounts in accordance
with such legislation, that they will not
fail to receive the benefits of section 529A
merely because the legislation or the account documents do not fully comport
with the guidance when it is issued. The
Treasury Department and the IRS intend
to provide transition relief with regard to
necessary changes to ensure that the state
programs and accounts meet the requirements in the guidance, including providing sufficient time after issuance of the
guidance in order for changes to be implemented. For those states that are moving forward before the issuance of additional guidance, this notice provides
advance notice of certain important ways
in which future section 529A guidance is
expected to differ from the section 529
proposed regulations so that states promulgating rules may appropriately reflect
a fundamental statutory requirement.
SECTION 3. NOTICE
Section 529A was modeled on section
529 of the Code, which provides taxexempt status to qualified tuition programs (QTPs) established and maintained
by a state (or agency or instrumentality
thereof), or by one or more eligible educational institutions, under which contributions may be made to an account that is
established for the purpose of meeting the
qualified higher education expenses of the
designated beneficiary of the account.
However, there are a few significant differences between the statutory provisions
governing QTPs and those governing
qualified ABLE programs.
To assist states currently contemplating legislation regarding ABLE programs
in advance of issuing further guidance to
implement section 529A, the Treasury
Department and the IRS advise that the
section 529A guidance, when issued, may

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differ in various ways from the proposed
regulations that have been promulgated
under section 529. In particular, the Treasury Department and the IRS currently
anticipate that, consistent with section
529A(e)(3), the guidance will provide that
the owner of an ABLE account is the
designated beneficiary of the account. In
addition, the Treasury Department and the
IRS currently anticipate that the section
529A guidance will provide that, with regard to the ABLE account of a designated
beneficiary who is not the person with
signature authority over that account, the
person with signature authority over the
account of the designated beneficiary may
neither have nor acquire any beneficial
interest in the account and must administer that account for the benefit of the designated beneficiary of that account.
DRAFTING INFORMATION
The principal author of this notice is
Sean Barnett of the Office of Associate
Chief Counsel (Tax Exempt and Government Entities). For further information regarding this notice, contact Mr. Barnett at
(202) 317-5800 (not a toll-free number).

Safe Harbor Method for
Determining a Wagering
Gain or Loss from Slot
Machine Play
Notice 2015–21
This notice provides a proposed revenue procedure that, if finalized, will provide an optional safe harbor method for
individual taxpayers to determine a wagering gain or loss from certain slot machine play.
Section 61 of the Internal Revenue
Code provides that gross income means
all income from whatever source derived. See also § 1.61–1 of the Income
Tax Regulations. Gains from wagering
transactions are included in gross income. See Rev. Rul. 54 –339, 1954 –2
C.B. 89. Neither the statute nor the regulations define the term “transactions.”
Gross income from a slot machine wagering transaction is determined on a

March 23, 2015