Foreign Tax Credit: Notification of Foreign Tax Redeterminations

Forms and Documents

Forms and supporting documents for this ICR

Document	Type	Status	Availability
2024 SS 1545-1056 final.docx	Supporting Statement A	Uploaded 2024-03-18	Available

IC Document Collections

Information collection document groups

IC ID	Collection	Type	Status	Form
266098	Annual reporting for provisional foreign tax credit		New
17753	Foreign Tax Redeterminations		Modified

ICR Details

OMB Control No: 1545-1056	ICR Reference No: 202403-1545-010
Status: Active	Previous ICR Reference No: 202105-1545-005
Agency/Subagency: TREAS/IRS	Agency Tracking No:
Title: Foreign Tax Credit: Notification of Foreign Tax Redeterminations
Type of Information Collection: Revision of a currently approved collection	Common Form ICR:  No
Type of Review Request: Regular
OIRA Conclusion Action: Approved without change	Conclusion Date: 05/06/2024
Retrieve Notice of Action (NOA)	Date Received in OIRA: 03/19/2024
Terms of Clearance:

table that charts list comparision

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	05/31/2027	36 Months From Approved	07/31/2024
Responses	24,900	0	13,000
Time Burden (Hours)	58,915	0	54,000
Cost Burden (Dollars)	0	0	0

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Abstract: Section 905(c) requires that a taxpayer notify the Internal Revenue Service of a change in the taxpayer's foreign income tax liability that may affect its foreign tax credit. Regulation section 1.905-4 provides rules concerning the time, manner, and contents of such notification. Should the taxpayer fail to notify the IRS, penalties under section 6689 may be imposed. Respondents are U.S. taxpayers that claim a foreign tax credit under section 901, 902, or 960. New regulations at §§1.905-1(c)(3) and 1.905-1(d)(4), issued under TD 9959, allow taxpayers to make an election to claim a provisional foreign tax credit for a contested foreign income tax liability to the extent that the taxpayer has paid the contested tax to the foreign country. These new final regulations require taxpayers who make the election to file an annual notification with the IRS notifying the IRS whether the contest is ongoing or whether it’s been resolved.

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Authorizing Statute(s): US Code: 44 USC 3507(d) Name of Law: Payments to be treated as payments of withholding and FICA taxes.
   PL: Pub.L. 105 - 34 788, 977 Name of Law: Taxpayer Relief Act of 1997
   PL: Pub.L. 108 - 357 1418 Name of Law: American Jobs Creation Act of 2004
   US Code: 26 USC 905(c) Name of Law: Adjustments to accrued taxes
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
1545-BP70	Final or interim final rulemaking	87 FR 276	01/04/2022

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Federal Register Notices & Comments

Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 2

table that charts list of burden

IC Title	Form No.	Form Name
Annual reporting for provisional foreign tax credit
Foreign Tax Redeterminations

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ICR Summary of Burden

table that charts list of burden

	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	24,900	13,000	0	11,900	0	0
Annual Time Burden (Hours)	58,915	54,000	0	4,915	0	0
Annual Cost Burden (Dollars)	0	0	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: Yes

Burden Increase Due to: Changing Regulations

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: This submission updates OMB Control Number 1545-1056 to reflect the issuance of TD 9959 (REG-101657-20). Taxpayers are generally required to file an amended return (or an administrative adjustment request in the case of certain partnerships) for the year or years affected by the FTR along with an updated Form 1116 Foreign Tax Credit (Individual, Estate, or Trust) (covered under OMB Control Number 1545-0074 individual, or 1545-0121 and 1545-0092 estate and trust) or Form 1118 Foreign Tax Credit-Corporations (OMB Control Number 1545-0123), and a written statement providing specific information relating to the FTR described in §1.905-4(c). Since the burden for filing amended income tax returns and the Forms 1116 and 1118 is covered under the other OMB control numbers listed above, the burden estimates for OMB Control Number 1545-1056 only cover the burden for the written statements. Foreign Tax Redetermination (1.901-1, 1.905-3, and 1.905-4): The agency estimates an increase in 500 respondents (13,000 to 13,500) which results in an increase of 2,065 overall burden hours (54,000 hours to 56,065 hours). Annual reporting for provisional foreign tax credit (1.905-1): The agency estimates 11,400 respondents will take .25 hours to respond for a total increase of overall burden of 2,850 hours.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Does this ICR request any personally identifiable information (see OMB Circular No. A-130 for an explanation of this term)? Please consult with your agency's privacy program when making this determination.     Yes

Does this ICR include a form that requires a Privacy Act Statement (see 5 U.S.C. §552a(e)(3))? Please consult with your agency's privacy program when making this determination.     No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? No

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Common Form ICR:  No

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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:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(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;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

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.

Certification Date: 03/19/2024

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