[4830-01-u]

DEPARTMENT OF THE TREASURY

Internal Revenue Service
26 CFR Parts 1, 31 and 40
[IA-03-94]
RIN 1545-AS79
Federal Tax Deposits by Electronic Funds Transfer
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Notice of proposed rulemaking by cross reference to
temporary regulations and notice of public hearing.
SUMMARY: In the Rules and Regulations section of this issue of
the Federal Register, the IRS is issuing temporary regulations
that provide guidance relating to the deposit of taxes by
electronic funds transfer under section 6302(h) of the Internal
Revenue Code. The text of the temporary regulations also serves
as the comment document for this notice of proposed rulemaking.
This document also provides notice of a public hearing on these
proposed regulations.
DATES: Written comments must be received by August 31, 1994.
Outlines of topics to be discussed at the public hearing
scheduled for September 21, 1994, beginning at 1:00 p.m. must be
received by August 31, 1994.
ADDRESSES: Send submissions to: CC:DOM:CORP:T:R (IA-03-94), room
5228, Internal Revenue Service, POB 7604, Ben Franklin Station,
Washington, DC 20044. In the alternative, submissions may be
hand delivered between the hours of 8 a.m. and 5 p.m. to:
CC:DOM:CORP:T:R (IA-03-94), Courier's Desk, Internal Revenue
Service, 1111 Constitution Avenue, NW, Washington, DC. The
public hearing will be held in the IRS Auditorium.
FOR FURTHER INFORMATION CONTACT: Concerning the regulations,
Vincent G. Surabian, 202-622-6232 (not a toll-free number).
Concerning submissions and the public hearing, Michael Slaughter
202-622-7190 (not a toll-free number).
SUPPLEMENTARY INFORMATION:
Background
The temporary regulations (TD 8553) published in the Rules
and Regulations section of this issue of the Federal Register
contain amendments to the Income Tax Regulations (26 CFR part 1),
the Regulations on Employment Taxes and Collection of Income Tax
at the Source (26 CFR part 31), and the Excise Tax Procedural
Regulations (26 CFR part 40). These amendments relate to the
deposits of taxes by electronic funds transfer. The final
regulations that will result from the regulations proposed in
this notice would be based on the text of the temporary
regulations and would provide rules for the gradual phase-in of
the requirement for taxpayers to deposit certain taxes by
electronic funds transfer.
The text of those temporary regulations also serves as the
text of these proposed regulations. The preamble to the
temporary regulations explains these proposed regulations.
Special Analyses
It has been determined that this notice of proposed
rulemaking is not a significant regulatory action as defined in
EO 12866. Therefore, a regulatory assessment is not required.
It also has been determined that section 553(b) of the
Administrative Procedure Act (5 U.S.C. chapter 5) and the
Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply to
these rules and, therefore, a Regulatory Flexibility Analysis is
not required. Pursuant to section 7805(f) of the Internal
Revenue Code, a copy of this notice of proposed rulemaking will
be submitted to the Chief Counsel for Advocacy of the Small
Business Administration for comment on its impact on small
business.
Comments and Public Hearing
Before these proposed regulations are adopted as final
regulations, consideration will be given to any written comments
(preferably a signed original and eight (8) copies) that are
timely submitted to the IRS. All comments will be available for
public inspection and copying.
A public hearing has been scheduled for September 21, 1994,
beginning at 1:00 p.m. at the IRS Auditorium. Because of access
restrictions, visitors will not be admitted beyond the building
lobby more than 15 minutes before the hearing starts.
The rules of 26 CFR 601.601(a)(3) apply to the hearing.
Persons who wish to present oral comments at the hearing
must submit written comments by August 31, 1994, and submit an
outline of the topics to be discussed and the time to be devoted
to each topic by August 31, 1994.
A period of 10 minutes will be allotted to each person for
making comments.
An agenda showing the scheduling of the speakers will be
prepared after the deadline for receiving comments has passed.
Copies of the agenda will be available free of charge at the
hearing.
Drafting Information
The principal author of these regulations is Vincent G.
Surabian, Office of the Assistant Chief Counsel (Income Tax &
Accounting), IRS. However, other personnel from the IRS and
Treasury Department participated in their development.
List of Subjects
26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
26 CFR Part 31
Employment taxes, Income taxes, Penalties, Pensions,
Railroad retirement, Reporting and recordkeeping requirements,
Social security, Unemployment compensation.
26 CFR Part 40
Excise taxes, Reporting and recordkeeping requirements.
Proposed Amendments to the Regulations
Accordingly, 26 CFR parts 1, 31 and 40 are proposed to be
amended as follows:
PART 1--INCOME TAXES
Paragraph 1. The authority citation for part 1 is amended by
removing the entry "Section 1.6302-1(a)" and adding entries in
numerical order to read as follows:
Authority: 26 U.S.C. 7805 * * *
Section 1.6302-1 also issued under 26 U.S.C. 6302(c) and (h).
Sections 1.6302-2 and 1.6302-3 also issued under 26 U.S.C.
6302(h). * * *
Par. 2. In #1.6302-1, paragraph (b)(2) is added to read as
follows:
#1.6302-1 Use of Government depositaries in connection with
corporation income and estimated income taxes and certain taxes
of tax-exempt organizations.
[The text of proposed paragraph (b)(2) is the same as the
text of #1.6302-1T(b)(2) published elsewhere in this issue of the
Federal Register].
Par. 3. In #1.6302-2, paragraph (c) is added to read as
follows:
#1.6302-2 Use of Government depositaries for payment of tax
withheld on nonresident aliens and foreign corporations.
[The text of proposed paragraph (c) is the same as the text
of #1.6302-2T(c) published elsewhere in this issue of the Federal
Register].
Par. 4. In #1.6302-3, paragraph (c) is added to read as
follows:
#1.6302-3 Use of Government depositaries in connection with
estimated taxes of certain trusts.
[The text of proposed paragraph (c) is the same as the text
of #1.6302-3T(c) published elsewhere in this issue of the Federal
Register].
PART 31--EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT THE
SOURCE
Par. 5. The authority citation for Part 31 is amended by
removing the entry "Sections 31.6302-1 through 31.6302-3" and
adding entries in numerical order to read as follows:
Authority: 26 U.S.C. 7805 * * *
Sections 31.6302-1 through 31.6302-3 also issued under 26 U.S.C.
6302(a), (c) and (h). * * *
Section 31.6302(c)-3 also issued under 26 U.S.C. 6302(h).
Par. 6. In #31.6302-1, paragraph (h) is redesignated as
paragraph (i) and new paragraph (h) is added to read as follows:
#31.6302-1 Federal tax deposit rules for withheld income taxes
and taxes under the Federal Insurance Contributions Act (FICA)
attributable to payments made after December 31, 1992.
[The text of proposed paragraph (h) is the same as the text
of #31.6302-1T(h) published elsewhere in this issue of the
Federal Register].
Par. 7. In #31.6302(c)-3, paragraph (c) is added to read as
follows:
#31.6302(c)-3 Use of Government depositaries in connection with
tax under the Federal Unemployment Tax Act.
[The text of proposed paragraph (c) is the same as the text
of #31.6302(c)-3T(c) published elsewhere in this issue of the
Federal Register].
PART 40--EXCISE TAX PROCEDURAL REGULATIONS
Par. 8. The authority citation for part 40 is amended by
removing the entry "Sections 40.6302(c)-1, 40.6302(c)-2,
40.6302(c)-3 and 40.6302(c)-4" and adding entries in numerical
order to read as follows:
Authority: 26 U.S.C. 7805 * * *
Section 40.6302(c)-1 also issued under 26 U.S.C. 6302(a) and
(h).
Sections 40.6302(c)-2, 40.6302(c)-3 and 40.6302(c)-4 also issued
under 26 U.S.C. 6302(a).
Par. 10. In #40.6302(c)-1, paragraph (d)(2) is added to read
as follows:
#40.6302(c)-1 Use of Government depositaries.
[The text of proposed paragraph (d)(2) is the same as the
text of #40.6302(c)-1T(d)(2) published elsewhere in this issue of
the Federal Register].
 Michael P. Dolan
Acting Commissioner of Internal Revenue