Internal Revenue Bulletin 2022-49 (PDF rendition): IRS Revenue Procedures

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Bulletin No. 2022–49
December 5, 2022
HIGHLIGHTS
OF THIS ISSUE
These synopses are intended only as aids to the reader in
identifying the subject matter covered. They may not be
relied upon as authoritative interpretations.
ADMINISTRATIVE
Rev. Proc. 2022-39, page 507.
The revenue procedure obsoletes and replaces existing
Revenue Procedure 94-69, 1994-2 C.B. 804. The rev-
enue procedure prescribes special procedures for cer-
tain eligible LB&I taxpayers who are subject to nearly
annual examinations to file a qualified amended return
shortly after the opening of an audit. Eligible taxpayers
may submit a form to report additional tax due or make
an adequate disclosure with respect to an item or posi-
tion to avoid the accuracy-related penalty described in
sections 6662(b)(1) and 6662(b)(2).
EMPLOYEE PLANS
Notice 2022-60, page 502.
This notice sets forth updates on the corporate bond
monthly yield curve, the corresponding spot segment
rates for November 2022 used under § 417(e)(3)(D),
the 24-month average segment rates applicable for
November 2022, and the 30-year Treasury rates, as
reflected by the application of § 430(h)(2)(C)(iv).
Notice 2022-62, page 506.
This notice sets forth the 2022 Required Amendments
List (2022 RA List). The 2022 RA List applies to both
individually designed plans qualified under section
401(a) of the Internal Revenue Code (qualified individ-
ually designed plans) and individually designed plans
that satisfy the requirements of section 403(b) (section
403(b) individually designed plans).
INCOME TAX
REG-112096-22, page 511.
This document contains proposed regulations that clar-
ify and revise certain foreign tax credit regulations that
were published on January 4, 2022. Specifically, these
proposed regulations amend the definition of a reat-
tribution asset for purposes of allocating and appor-
tioning foreign income taxes; revise the cost recovery
rule under the requirements for a tax to be a creditable
foreign income tax; and provide a limited exception to
the source-based attribution requirement for withhold-
ing taxes imposed on royalty payments to be creditable
foreign income taxes.
Rev. Rul. 2022-22, page 500.
Federal rates; adjusted federal rates; adjusted federal
long-term rate, and the long-term tax exempt rate. For
purposes of sections 382, 1274, 1288, 7872 and
other sections of the Code, tables set forth the rates
for December 2022.
Finding Lists begin on page ii.

The IRS Mission
Provide America’s taxpayers top-quality service by helping
them understand and meet their tax responsibilities and
enforce the law with integrity and fairness to all.
Introduction
The Internal Revenue Bulletin is the authoritative instrument
of the Commissioner of Internal Revenue for announcing offi-
cial rulings and procedures of the Internal Revenue Service
and for publishing Treasury Decisions, Executive Orders, Tax
Conventions, legislation, court decisions, and other items of
general interest. It is published weekly.
It is the policy of the Service to publish in the Bulletin all sub-
stantive rulings necessary to promote a uniform application
of the tax laws, including all rulings that supersede, revoke,
modify, or amend any of those previously published in the
Bulletin. All published rulings apply retroactively unless other-
wise indicated. Procedures relating solely to matters of inter-
nal management are not published; however, statements of
internal practices and procedures that affect the rights and
duties of taxpayers are published.
Revenue rulings represent the conclusions of the Service
on the application of the law to the pivotal facts stated in
the revenue ruling. In those based on positions taken in rul-
ings to taxpayers or technical advice to Service field offices,
identifying details and information of a confidential nature are
deleted to prevent unwarranted invasions of privacy and to
comply with statutory requirements.
Rulings and procedures reported in the Bulletin do not have the
force and effect of Treasury Department Regulations, but they
may be used as precedents. Unpublished rulings will not be
relied on, used, or cited as precedents by Service personnel in
the disposition of other cases. In applying published rulings and
procedures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be considered,
and Service personnel and others concerned are cautioned
against reaching the same conclusions in other cases unless
the facts and circumstances are substantially the same.
The Bulletin is divided into four parts as follows:
Part I.—1986 Code.
This part includes rulings and decisions based on provisions
of the Internal Revenue Code of 1986.
Part II.—Treaties and Tax Legislation.
This part is divided into two subparts as follows: Subpart A,
Tax Conventions and Other Related Items, and Subpart B,
Legislation and Related Committee Reports.
Part III.—Administrative, Procedural, and Miscellaneous.
To the extent practicable, pertinent cross references to these
subjects are contained in the other Parts and Subparts. Also
included in this part are Bank Secrecy Act Administrative
Rulings. Bank Secrecy Act Administrative Rulings are issued
by the Department of the Treasury’s Office of the Assistant
Secretary (Enforcement).
Part IV.—Items of General Interest.
This part includes notices of proposed rulemakings, disbar-
ment and suspension lists, and announcements.
The last Bulletin for each month includes a cumulative index
for the matters published during the preceding months. These
monthly indexes are cumulated on a semiannual basis, and are
published in the last Bulletin of each semiannual period.
The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.
December 5, 2022 Bulletin No. 2022–49

Part I
Section 1274.—
Determination of Issue
Price in the Case of Certain
Debt Instruments Issued for
Property
(Also Sections 42, 280G, 382, 467, 468, 482, 483,
1288, 7520, 7872.)
Rev. Rul. 2022-22
This revenue ruling provides vari-
ous prescribed rates for federal income
tax purposes for December 2022 (the
current month). Table 1 contains the
short-term, mid-term, and long-term
applicable federal rates (AFR) for the
current month for purposes of section
1274(d) of the Internal Revenue Code.
Table 2 contains the short-term, mid-
term, and long-term adjusted applica-
ble federal rates (adjusted AFR) for the
current month for purposes of section
1288(b). Table 3 sets forth the adjusted
federal long-term rate and the long-term
tax-exempt rate described in section
382(f). Table 4 contains the appropriate
percentages for determining the low-in-
come housing credit described in sec-
tion 42(b)(1) for buildings placed in
service during the current month. How-
ever, under section 42(b)(2), the appli-
cable percentage for non-federally sub-
sidized new buildings placed in service
after July 30, 2008, shall not be less
than 9%. Finally, Table 5 contains the
federal rate for determining the present
value of an annuity, an interest for life
or for a term of years, or a remainder or
a reversionary interest for purposes of
section 7520.
REV. RUL. 2022-22 TABLE 1
Applicable Federal Rates (AFR) for December 2022
Period for Compounding
AnnualSemiannualQuarterlyMonthly
Short-term
AFR4.55%4.50%4.47%4.46%
110% AFR5.01%4.95%4.92%4.90%
120% AFR5.47%5.40%5.36%5.34%
130% AFR5.94%5.85%5.81%5.78%
Mid-term
AFR4.27%4.23%4.21%4.19%
110% AFR4.70%4.65%4.62%4.61%
120% AFR5.14%5.08%5.05%5.03%
130% AFR5.58%5.50%5.46%5.44%
150% AFR6.45%6.35%6.30%6.27%
175% AFR7.54%7.40%7.33%7.29%
Long-term
AFR4.34%4.29%4.27%4.25%
110% AFR4.78%4.72%4.69%4.67%
120% AFR5.22%5.15%5.12%5.10%
130% AFR5.66%5.58%5.54%5.52%
REV. RUL. 2022-22 TABLE 2
Adjusted AFR for December 2022
Period for Compounding
AnnualSemiannualQuarterlyMonthly
Short-term adjusted AFR3.45%3.42%3.41%3.40%
Mid-term adjusted AFR3.24%3.21%3.20%3.19%
Long-term adjusted AFR3.29%3.26%3.25%3.24%
December 5, 2022 500 Bulletin No. 2022–49

REV. RUL. 2022-22 TABLE 3
Rates Under Section 382 for December 2022
Adjusted federal long-term rate for the current month3.29%
Long-term tax-exempt rate for ownership changes during the current month (the highest of the adjusted federal
long-term rates for the current month and the prior two months.)
3.29%
REV. RUL. 2022-22 TABLE 4
Appropriate Percentages Under Section 42(b)(1) for December 2022
Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July
30, 2008, shall not be less than 9%.
Appropriate percentage for the 70% present value low-income housing credit8.00%
Appropriate percentage for the 30% present value low-income housing credit 3.43%
REV. RUL. 2022-22 TABLE 5
Rate Under Section 7520 for December 2022
Applicable federal rate for determining the present value of an annuity, an interest for life or a term of years, or a
remainder or reversionary interest
5.20%
Section 42.—Low-Income
Housing Credit
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
December 2022. See Rev. Rul. 2022-22, page 500.
Section 280G.—Golden
Parachute Payments
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
December 2022. See Rev. Rul. 2022-22, page 500.
Section 382.—Limitation
on Net Operating Loss
Carryforwards and
Certain Built-In Losses
Following Ownership
Change
The adjusted applicable federal long-term rate
is set forth for the month of December 2022. See
Rev. Rul. 2022-22, page 500.
Section 467.—Certain
Payments for the Use of
Property or Services
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
December 2022. See Rev. Rul. 2022-22, page 500.
Section 468.—Special
Rules for Mining and Solid
Waste Reclamation and
Closing Costs
The applicable federal short-term rates are set
forth for the month of December 2022. See Rev.
Rul. 2022-22, page 500.
Section 482.—Allocation
of Income and Deductions
Among Taxpayers
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
December 2022. See Rev. Rul. 2022-22, page 500.
Section 483.—Interest on
Certain Deferred Payments
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
December 2022. See Rev. Rul. 2022-22, page 500.
Section 1288.—Treatment
of Original Issue Discount
on Tax-Exempt Obligations
The adjusted applicable federal short-term,
mid-term, and long-term rates are set forth for the
month of December 2022. See Rev. Rul. 2022-22,
page 500.
Section 7520.—Valuation
Tables
The applicable federal mid-term rates are set
forth for the month of December 2022. See Rev.
Rul. 2022-22, page 500.
Section 7872.—Treatment
of Loans With Below-
Market Interest Rates
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
December 2022. See Rev. Rul. 2022-22, page 500.

Bulletin No. 2022–49 501 December 5, 2022

December 5, 2022 502 Bulletin No. 2022–49
Part III
Administrative,
Miscellaneous, and
Procedural
Update for Weighted Average
Interest Rates, Yield Curves,
and Segment Rates
Notice 2022-60
This notice provides guidance on the
corporate bond monthly yield curve, the
corresponding spot segment rates used
under § 417(e)(3), and the 24-month aver-
age segment rates under § 430(h)(2) of the
Internal Revenue Code. In addition, this
notice provides guidance as to the inter-
est rate on 30-year Treasury securities
under § 417(e)(3)(A)(ii)(II) as in effect for
plan years beginning before 2008 and the
30-year Treasury weighted average rate
under § 431(c)(6)(E)(ii)(I).
YIELD CURVE AND SEGMENT
RATES
Section 430 specifies the minimum
funding requirements that apply to
single-employer plans (except for CSEC
plans under § 414(y)) pursuant to § 412.
Section 430(h)(2) specifies the inter-
est rates that must be used to determine
a plan’s target normal cost and funding
target. Under this provision, present
value is generally determined using three
24-month average interest rates (“seg-
ment rates”), each of which applies to
cash flows during specified periods. To
the extent provided under § 430(h)(2)(C)
(iv), these segment rates are adjusted by
the applicable percentage of the 25-year
average segment rates for the period end-
ing September 30 of the year preceding
the calendar year in which the plan year
begins.
1
However, an election may be
made under § 430(h)(2)(D)(ii) to use the
monthly yield curve in place of the seg-
ment rates.
Notice 2007-81, 2007-44 I.R.B. 899,
provides guidelines for determining the
monthly corporate bond yield curve, and
the 24-month average corporate bond
segment rates used to compute the target
normal cost and the funding target. Con-
sistent with the methodology specified in
Notice 2007-81, the monthly corporate
bond yield curve derived from October
2022 data is in Table 2022-10 at the end
of this notice. The spot first, second, and
third segment rates for the month of Octo-
ber 2022 are, respectively, 5.10, 5.83, and
5.68.
The 24-month average segment rates
determined under § 430(h)(2)(C)(i)
through (iii) must be adjusted pursuant to
§ 430(h)(2)(C)(iv) to be within the appli-
cable minimum and maximum percent-
ages of the corresponding 25-year aver-
age segment rates. The 25-year average
segment rates for plan years beginning
in 2021, 2022 and 2023 were published
in Notice 2020-72, 2020-40 I.R.B. 789,
Notice 2021-54, 2021-41 I.R.B. 457,
and Notice 2022-40, 2022-40 I.R.B. 266,
respectively.
24-MONTH AVERAGE CORPORATE
BOND SEGMENT RATES
The three 24-month average corpo-
rate bond segment rates applicable for
November 2022 without adjustment for
the 25-year average segment rate limits
are as follows:
24-Month Average Segment Rates Without 25-Year Average Adjustment
Applicable Month First Segment Second Segment Third Segment
November 2022 1.76 3.36 3.76
Section 9706(a) of the American Res-
cue Plan Act of 2021, Pub. L. 117-2 (the
ARP), which was enacted on March 11,
2021, changed the 25-year average seg-
ment rates and the applicable minimum
and maximum percentages used under
§ 430(h)(2)(C)(iv) of the Code to adjust
the 24-month average segment rates.
2

Prior to this change, the applicable min-
imum and maximum percentages were
85% and 115% for a plan year beginning
in 2021, and 80% and 120% for a plan
year beginning in 2022, respectively.
After this change, the applicable mini-
mum and maximum percentages are 95%
and 105% for a plan year beginning in
2021 or 2022. In addition, pursuant to
this change, any 25-year average seg-
ment rate that is less than 5% is deemed
to be 5%.
3
Pursuant to § 9706(c)(1) of the ARP,
these changes apply with respect to plan
years beginning on or after January 1,
2020. However, § 9706(c)(2) of the ARP
provides that a plan sponsor may elect not
to have these changes apply to any plan
year beginning before January 1, 2022.
4
The adjusted 24-month average seg-
ment rates set forth in the chart below
reflect § 430(h)(2)(C)(iv) of the Code as
1
Pursuant to § 433(h)(3)(A), the third segment rate determined under § 430(h)(2)(C) is used to determine the current liability of a CSEC plan (which is used to calculate the minimum amount
of the full funding limitation under § 433(c)(7)(C)).
2
Section 80602 of the Infrastructure Investment and Jobs Act, Pub. L. 117-58, makes further changes to the time periods for which specified applicable minimum and maximum percentages
apply.
3
Pursuant to this change, the 25-year averages of the first segment rate for 2021 and 2022 are increased to 5.00% because those 25-year averages as originally published are below 5.00%.
4
This election may be made either for all purposes for which the amendments under § 9706 of the ARP apply or solely for purposes of determining the adjusted funding target attainment
percentage under § 436 of the Code for the plan year.

Bulletin No. 2022–49 503 December 5, 2022
amended by § 9706(a) of the ARP. These
adjusted 24-month average segment rates
apply only for plan years for which an
election under § 9706(c)(2) of the ARP is
not in effect. For a plan year for which such
an election does not apply, the 24-month
averages applicable for November 2022,
adjusted to be within the applicable
minimum and maximum percentages of
the corresponding 25-year average seg-
ment rates in accordance with § 430(h)(2)
(C)(iv) of the Code, are as follows:
Adjusted 24-Month Average Segment Rates
For Plan Years
Beginning InApplicable MonthFirst SegmentSecond SegmentThird Segment
2021November 20224.755.366.11
2022November 20224.755.185.92
2023November 20224.755.005.74
The adjusted 24-month average seg-
ment rates set forth in the chart below do
not reflect the changes to § 430(h)(2)(C)
(iv) of the Code made by § 9706(a) of the
ARP. These adjusted 24-month average
segment rates apply only for plan years for
which an election under § 9706(c)(2) of the
ARP is in effect. For a plan year for which
such an election applies, the 24-month
averages applicable for November 2022,
adjusted to be within the applicable min-
imum and maximum percentages of the
corresponding 25-year average segment
rates in accordance with § 430(h)(2)(C)
(iv) of the Code, are as follows:
Pre-ARP Adjusted 24-Month Average Segment Rates
For Plan Years
Beginning InApplicable MonthFirst SegmentSecond SegmentThird Segment
2021November 20223.324.795.47
30-YEAR TREASURY SECURITIES
INTEREST RATES
Section 431 specifies the minimum
funding requirements that apply to mul-
tiemployer plans pursuant to § 412. Sec-
tion 431(c)(6)(B) specifies a minimum
amount for the full-funding limitation
described in § 431(c)(6)(A), based on the
plan’s current liability. Section 431(c)
(6)(E)(ii)(I) provides that the interest
rate used to calculate current liability for
this purpose must be no more than 5 per-
cent above and no more than 10 percent
below the weighted average of the rates
of interest on 30-year Treasury securi-
ties during the four-year period ending
on the last day before the beginning
of the plan year. Notice 88-73, 1988-2
C.B. 383, provides guidelines for deter-
mining the weighted average interest
rate. The rate of interest on 30-year
Treasury securities for October 2022 is
4.02 percent. The Service determined
this rate as the average of the daily
determinations of yield on the 30-year
Treasury bond maturing in August 2052.
For plan years beginning in November
2022, the weighted average of the rates
of interest on 30-year Treasury securi-
ties and the permissible range of rate
used to calculate current liability are as
follows:
Treasury Weighted Average Rates
For Plan Years Beginning In30-Year Treasury Weighted AveragePermissible Range 90% to 105%
November 20222.332.09 to 2.44
MINIMUM PRESENT VALUE
SEGMENT RATES
In general, the applicable interest rates
under § 417(e)(3)(D) are segment rates
computed without regard to a 24-month
average. Notice 2007-81 provides guide-
lines for determining the minimum
present value segment rates. Pursuant to
that notice, the minimum present value
segment rates determined for October
2022 are as follows:
Minimum Present Value Segment Rates
Month First Segment Second Segment Third Segment
October 2022 5.10 5.83 5.68

December 5, 2022 504 Bulletin No. 2022–49
DRAFTING INFORMATION
The principal author of this notice is
Tom Morgan of the Office of Associate
Chief Counsel (Employee Benefits,
Exempt Organizations, and Employment
Taxes). However, other personnel from
the IRS participated in the development
of this guidance. For further information
regarding this notice, contact Mr. Morgan
at 202-317-6700 or Tony Montanaro at
626-927-1475 (not toll-free calls).

Bulletin No. 2022–49 505 December 5, 2022
Table 2022-10
Monthly Yield Curve for October 2022
Derived from October 2022 Data
MaturityYieldMaturityYieldMaturityYieldMaturityYieldMaturityYield
0.54.5320.55.8940.55.6560.55.5880.55.55
1.04.7921.05.8741.05.6561.05.5881.05.55
1.55.0021.55.8641.55.6561.55.5881.55.55
2.05.1422.05.8542.05.6462.05.5882.05.55
2.55.2222.55.8442.55.6462.55.5882.55.55
3.05.2523.05.8343.05.6463.05.5883.05.55
3.55.2623.55.8243.55.6463.55.5883.55.54
4.05.2624.05.8144.05.6464.05.5884.05.54
4.55.2824.55.8044.55.6364.55.5784.55.54
5.05.3025.05.7945.05.6365.05.5785.05.54
5.55.3325.55.7845.55.6365.55.5785.55.54
6.05.3826.05.7746.05.6366.05.5786.05.54
6.55.4326.55.7646.55.6266.55.5786.55.54
7.05.4927.05.7647.05.6267.05.5787.05.54
7.55.5527.55.7547.55.6267.55.5787.55.54
8.05.6228.05.7548.05.6268.05.5788.05.54
8.55.6828.55.7448.55.6268.55.5788.55.54
9.05.7329.05.7349.05.6269.05.5789.05.54
9.55.7929.55.7349.55.6169.55.5689.55.54
10.05.8330.05.7250.05.6170.05.5690.05.54
10.55.8730.55.7250.55.6170.55.5690.55.54
11.05.9131.05.7251.05.6171.05.5691.05.54
11.55.9431.55.7151.55.6171.55.5691.55.54
12.05.9632.05.7152.05.6172.05.5692.05.54
12.55.9832.55.7052.55.6072.55.5692.55.53
13.05.9933.05.7053.05.6073.05.5693.05.53
13.56.0033.55.7053.55.6073.55.5693.55.53
14.06.0134.05.6954.05.6074.05.5694.05.53
14.56.0134.55.6954.55.6074.55.5694.55.53
15.06.0135.05.6855.05.6075.05.5695.05.53
15.56.0035.55.6855.55.6075.55.5695.55.53
16.05.9936.05.6856.05.5976.05.5596.05.53
16.55.9836.55.6756.55.5976.55.5596.55.53
17.05.9737.05.6757.05.5977.05.5597.05.53
17.55.9637.55.6757.55.5977.55.5597.55.53
18.05.9538.05.6758.05.5978.05.5598.05.53
18.55.9438.55.6658.55.5978.55.5598.55.53
19.05.9239.05.6659.05.5979.05.5599.05.53
19.55.9139.55.6659.55.5979.55.5599.55.53
20.05.9040.05.6560.05.5880.05.55100.05.53

December 5, 2022 506 Bulletin No. 2022–49
2022 Required
Amendments List
for Individually
Designed Qualified and
Section 403(b) Plans
Notice 2022-62
I. PURPOSE
This notice sets forth the 2022 Required
Amendments List (2022 RA List). The
Required Amendments List (RA List)
applies to both individually designed
plans qualified under section 401(a) of
the Internal Revenue Code (Code) (qual-
ified individually designed plans) and
individually designed plans that satisfy
the requirements of section 403(b) (sec-
tion 403(b) individually designed plans).
Section 5 of Rev. Proc. 2022-40, 2022-
47 IRB 487, provides generally that,
except as otherwise provided by statute or
in regulations or other guidance published
in the Internal Revenue Bulletin (IRB), in
the case of an individually designed qual-
ified or section 403(b) plan that is not a
governmental plan within the meaning of
section 414(d), the remedial amendment
period for (1) a disqualifying provision or
(2) a form defect first occurring after June
30, 2020, that arises as a result of a change
in qualification requirements or sec-
tion 403(b) requirements, as applicable,
expires on the last day of the second cal-
endar year that begins after the issuance of
the RA List on which the change in qual-
ification requirements or section 403(b)
requirements appears. Pursuant to section
5.03(1)(c) and section 6.01 of Rev. Proc.
2022-40, December 31, 2024, generally is
both the last day of the remedial amend-
ment period and the plan amendment
deadline with respect to (1) a disqualifying
provision arising as a result of a change in
qualification requirements that appears on
the 2022 RA List, and (2) a form defect
arising as a result of a change in section
403(b) requirements that appears on the
2022 RA List. Later dates may apply to a
governmental plan within the meaning of
section 414(d) pursuant to section 5.03(2)
(c) of Rev. Proc. 2022-40. References to
qualification requirements and to sec-
tion 403(b) requirements in Parts III and
IV of this notice are referred to, separately
and collectively, as “requirements.”
1
II. BACKGROUND
Section 401(b) of the Code provides a
remedial amendment period during which
a plan may be amended retroactively to
comply with the qualification requirements
under section 401(a). Section 1.401(b)-1
describes the disqualifying provisions that
may be amended retroactively and the
remedial amendment period during which
retroactive amendments may be adopted.
That regulation also grants the Commis-
sioner of Internal Revenue the discretion
to designate in guidance published in the
IRB certain plan provisions as disqualify-
ing provisions and to extend the remedial
amendment period.
Section 21.02 of Rev. Proc. 2013-22,
2013-18 IRB 985,
2
establishes an initial
remedial amendment period that permits
an eligible employer to retroactively cor-
rect form defects in its written section
403(b) plan.
Rev. Proc. 2017-18, as modified by
Notice 2020-35, 2020-25 IRB 948, pro-
vides that the initial remedial amendment
period for a form defect in a section 403(b)
plan ends on June 30, 2020.
Section 5 of Rev. Proc. 2022-40 pro-
vides that except as otherwise provided by
statute or in regulations or other guidance
published in the IRB, with respect to plans
that are not governmental plans within the
meaning of section 414(d), the remedial
amendment period for (1) a disqualifying
provision or (2) a form defect first occur-
ring after June 30, 2020, that arises as a
result of a change in qualification require-
ments or section 403(b) requirements, as
applicable, expires on the last day of the
second calendar year that begins after
the issuance of the RA List on which
the change in qualification requirements
or section 403(b) requirements appears.
Section 5.03(2) provides a special rule
for governmental plans that may further
extend the remedial amendment period in
some cases.
Section 6.01 of Rev. Proc. 2022-40 pro-
vides that the plan amendment deadline
with respect to (1) a disqualifying provi-
sion in a qualified individually designed
plan, or (2) a form defect first occurring
after June 30, 2020, in a section 403(b)
individually designed plan described in
section 5 of Rev. Proc. 2022-40 is the date
on which the remedial amendment period
expires with respect to that disqualifying
provision or form defect.
Section 7 of Rev. Proc. 2022-40 pro-
vides that the Treasury Department and
the IRS publish an annual RA List. In
general, a change in qualification require-
ments or section 403(b) requirements will
not appear on an RA List until guidance
with respect to that change (including,
in certain cases, model amendments)
has been provided in regulations or in
other guidance published in the IRB.
However, in the discretion of the Trea-
sury Department and the IRS, a change
in qualification requirements or section
403(b) requirements may be included on
an RA List in other circumstances, such
as in cases in which a statutory change is
enacted and the Treasury Department and
the IRS anticipate that no guidance will be
issued.
The remedial amendment period appli-
cable to a disqualifying provision or form
defect arising as a result of a change in
qualification requirements or section
403(b) requirements may be extended
beyond the date that normally would
apply to an item included on an RA List,
if, for example, a statute, regulation, or
other guidance published in the IRB pro-
vides for a later deadline.
III. CONTENT AND
ORGANIZATION OF RA LIST
In general, an RA List includes statu-
tory and administrative changes in require-
ments that are first effective during the
1
In order to help plan sponsors achieve operational compliance with changes in requirements, the IRS provides the Operational Compliance List, which is a list of changes in both qualification
requirements and section 403(b) requirements that are effective during a calendar year, on the IRS website at https://www.irs.gov/retirement-plans/operational-compliance-list. See section
8 of Rev. Proc. 2022-40.
2
Rev. Proc. 2013-22 was modified by Rev. Proc. 2014-28, 2014-16 I.R.B. 944, and Rev. Proc. 2015-22, 2015-11 I.R.B. 754, and clarified by Rev. Proc. 2017-18, 2017-5 I.R.B. 743.

Bulletin No. 2022–49 507 December 5, 2022
plan year in which the list is published.
3

However, an RA List does not include:
• Guidance issued or legislation enacted
after the list has been prepared;
• Statutory changes in requirements
for which the Treasury Department
and the IRS expect to issue guidance
that would be included on an RA List
issued in a future year;
4
• Changes in requirements that permit
(but do not require) optional plan
provisions, in contrast to changes
in requirements that cause existing
plan provisions (which may include
optional plan provisions previously
adopted) to become disqualifying
provisions or section 403(b) form
defects;
5
or
• Changes in the tax laws affecting
qualified individually designed
plans or section 403(b) individually
designed plans that do not change the
requirements (such as changes to the
tax treatment of plan distributions, or
changes to the funding requirements
for qualified individually designed
plans).
The RA List is divided into two parts.
Part A covers changes in requirements that
generally would require an amendment to
most plans or to most plans of the type
affected by the change.
Part B includes changes in requirements
that the Treasury Department and the IRS
anticipate will not require amendments to
most plans but might require an amend-
ment because of an unusual plan provi-
sion in a particular plan. For example, if
a change affects a particular requirement
that most plans incorporate by reference,
Part B would include that change because
a particular plan might not incorporate the
requirement by reference and, thus, might
include language inconsistent with the
change.
Annual, monthly, or other periodic
changes to (1) the various dollar limits that
are adjusted for cost of living increases as
provided in section 415(d) or other Code
provisions, (2) the spot segment rates used
to determine the applicable interest rate
under section 417(e)(3), and (3) the appli-
cable mortality table under section 417(e)
(3), are treated as included on the RA List
for the year in which such changes are
effective even though they are not directly
referenced on that RA List. The Treasury
Department and the IRS anticipate that
few plans have language that will need to
be amended on account of these changes.
The fact that a change in a requirement
is included on the RA List does not neces-
sarily mean that a plan must be amended
as a result of that change. Each plan spon-
sor must determine whether a particu-
lar change in a requirement requires an
amendment to its plan.
IV. 2022 REQUIRED AMENDMENTS
LIST
There are no entries listing changes in
qualification requirements on the 2022 RA
List.
6
V. DRAFTING INFORMATION
The principal author of this notice is
Tom Morgan of the Office of Associ-
ate Chief Counsel (Employee Benefits,
Exempt Organizations, and Employ-
ment Taxes). For further information
regarding this notice, contact Mr. Morgan
at (202) 317-6700 (not a toll-free number).
26 CFR 601.105: Examination of returns and claims
for refund, credit or abatement; determination of
correct tax liability
(Also: Part I, §§ 6662, 6664; 1.6662-3, 1.6662-4,
1.6664-2.)
Rev. Proc. 2022-39
SECTION 1. PURPOSE
The purpose of this revenue procedure
is to obsolete Rev. Proc. 94-69, 1994-2
C.B. 804, and prescribe special proce-
dures for eligible taxpayers to file a qual-
ified amended return in accordance with
§ 1.6664-2(c)(4)(ii) of the Income Tax
Regulations. This revenue procedure also
sets forth special procedures for eligible
taxpayers to show additional tax due or
make adequate disclosure with respect
to an item or a position on a previously
filed return to avoid imposition of the
accuracy-related penalties described in §§
6662(b)(1) and 6662(b)(2) of the Internal
Revenue Code (Code).
SECTION 2. BACKGROUND
.01 Section 6662(b)(1) and (2) impose
an accuracy-related penalty equal to
20 percent of the portion of any underpay-
ment that is attributable to (1) negligence
or disregard of rules or regulations or (2)
any substantial understatement of income
tax.
.02 Section 1.6662-3(c) provides, gen-
erally, that no penalty for disregard of
3
RA Lists also may include changes in requirements that were first effective in a prior year that were not included on a prior RA List under certain circumstances, such as changes in require-
ments that were issued or enacted after the prior year’s RA List was prepared.
4
For example, certain provisions of Division O of the Further Consolidated Appropriations Act, 2020, Pub. L. 116-94, 133 Stat. 2534 (2019), known as the Setting Every Community Up for
Retirement Enhancement Act of 2019 (SECURE Act), are already effective, but have not been included on an RA List. As explained in Notice 2022-33, 2022-34 IRB 147 (guidance that, in
part, extends the deadlines for amending a retirement plan to reflect provisions of the SECURE Act), it is anticipated that (1) guidance will be issued with respect to certain SECURE Act
provisions and (2) the guidance and SECURE Act provisions requiring plan amendments will appear on a future RA List.
5
The remedial amendment period and plan amendment deadline for discretionary changes to the terms of an individually designed qualified or section 403(b) plan are governed by sections
5.03(1)(b), 5.03(2)(b), and 6.02 of Rev. Proc. 2022-40. These deadlines for discretionary changes are not affected by the inclusion of a change in requirements on an RA List.
6
The 2021 RA List included entries for section 9704 of the American Rescue Plan Act of 2021 (ARP) and Notice 2021-38, 2021-30 IRB 155, relating to special financial assistance for certain
eligible multiemployer plans. Under these provisions, the sponsor of an eligible multiemployer plan has the discretion, during a period of several years beginning in 2021, to either apply for
or not apply for special financial assistance pursuant to section 9704 of the ARP. If the plan sponsor (1) exercises its discretion to apply for special financial assistance, (2) had previously
suspended plan benefits pursuant to section 432(e)(9) of the Code or section 4245(a) of the Employee Retirement Income Security Act of 1974, Pub. L. 93-406, 88 Stat. 829, as amended, and
(3) received special financial assistance, then the sponsor is required to amend the plan to provide for reinstatement of the suspended benefits and for make-up payments, in accordance with
Notice 2021-38. Beginning in 2022, an amendment made pursuant to section 9704 of the ARP will be treated as a discretionary amendment, and the plan amendment deadlines applicable
to discretionary amendments as set forth in Rev. Proc. 2022-40 will apply. Accordingly, for a sponsor of an eligible multiemployer plan that commences payment of previously suspended
benefits and make-up payments on account of being granted special financial assistance after 2021, the deadline for adopting the amendment to provide for these payments is the later of (1)
the amendment deadline specified in the 2021 RA List that applies to plans eligible for special financial assistance (that is, December 31, 2023), or (2) the amendment deadline that would
apply if the amendment were a discretionary amendment (that is, the end of the plan year in which the plan amendment is operationally put into effect, through the commencement of these
payments by the plan).

December 5, 2022 508 Bulletin No. 2022–49
rules or regulations will be imposed on
any underpayment attributable to an item
or position that is adequately disclosed,
has a reasonable basis and, for penalties
attributable to disregard of a regulation,
represents a good faith challenge to the
validity of the regulation.
.03 Section 6662(d)(1) generally
defines “substantial understatement” of
income tax to be an understatement for the
taxable year that exceeds the greater of 10
percent of the tax required to be shown on
the return or $5,000 (or, in the case of a
corporation other than an S corporation or
a personal holding company, exceeds the
lesser of (1) 10 percent of the tax required
to be shown on the return (or, if greater,
$10,000) or (2) $10 million).
.04 In the case of a taxpayer who
claims any deduction allowed under §
199A of the Code for the taxable year, an
understatement is substantial if it exceeds
the greater of 5 percent of the tax required
to be shown on the return or $5,000.
.05 Under §§ 6662(d)(2)(B)(ii) and
1.6662-4(e), the tax treatment of an item
(other than a tax shelter item or an item
attributable to a multiple-party financing
transaction if such treatment does not
clearly reflect the income of the corpora-
tion) for which the taxpayer had a reason-
able basis, that is properly substantiated
and adequately disclosed, and for which
the taxpayer kept adequate books and
records is not taken into account in com-
puting the amount of an understatement of
income tax for purposes of the substantial
understatement penalty.
.06 Section 1.6662-7 provides that the
accuracy-related penalty for disregarding
rules or regulations or for a substantial
understatement of income tax may be
avoided by disclosure of a return position
only if the position has at least a reason-
able basis.
.07 Sections 1.6662-3(c) and 1.6662-
4(f) provide the methods for making ade-
quate disclosures for purposes of (1) the
penalty for disregard of rules or regula-
tions, and (2) the substantial understate-
ment penalty, respectively. These methods
include attaching a properly completed
Form 8275, Disclosure Statement, to an
original return or to a qualified amended
return in the case of an item or position
other than one that is contrary to a regu-
lation. In the case of a position contrary
to a regulation, disclosure must be made
on Form 8275-R, Regulation Disclosure
Statement.
.08 Section 1.6664-2(c)(3) generally
provides, among other deadlines, that
for purposes of the accuracy-related pen-
alty, a “qualified amended return” is an
amended return, or request for an admin-
istrative adjustment under § 6227, that is
filed after the due date of the return for
the taxable year (including extensions)
and before the earliest of (1) the date
on which the Internal Revenue Service
(IRS) first contacts the taxpayer con-
cerning an examination of the return or
(2) for certain pass-through items, the
date on which the IRS first contacts the
pass-through entity in connection with
an examination of the return to which the
pass-through item relates. In addition,
§ 1.6664-2(c)(4)(ii) provides that the
Commissioner may prescribe by revenue
procedure the manner in which the rules
governing qualified amended returns
apply to particular classes of taxpayers.
.09 Qualified amended returns are
intended to encourage voluntary com-
pliance by permitting taxpayers to avoid
accuracy-related penalties by filing an
amended return before the IRS begins
an examination of the taxpayer or the
promoter of a transaction in which the
taxpayer participated. See T.D. 9186,
2005-13 I.R.B. 790 (March 2, 2005) (pro-
viding additional circumstances that end
the period within which a taxpayer may
file an amended return that constitutes a
qualified amended return).
.10 To discourage taxpayers from for-
going or delaying the filing of amended
returns unless or until the IRS has taken
steps to identify taxpayers who filed
returns with underpayments, § 1.6664-
2(c)(3) sets out events that operate as
deadlines after which a taxpayer may not
avoid accuracy-related penalties by filing
an amended return. See T.D. 9186.
.11 Revenue Procedure 94-69 set forth
special procedures for taxpayers that
were subject to audit each year under the
now-discontinued Coordinated Examina-
tion Program (CEP). After elimination of
the CEP in 2000, Rev. Proc. 94-69 was
applied to taxpayers subject to audit under
the Coordinated Industry Case Program
(CIC). Taxpayers in the CEP and CIC pro-
grams were unique in that, unlike most
taxpayers, they were generally subject to
a continuous examination covering each
year’s return; and as such, amendments
to filed returns were best addressed as the
examination of a particular year started
through a disclosure to the examination
team in lieu of filing a regular qualified
amended return.
.12 The special procedures set forth in
Rev. Proc. 94-69 allowed taxpayers sub-
ject to the CEP and CIC to show addi-
tional tax due or to make adequate disclo-
sures with respect to an item or a position
and thereby avoid the imposition of accu-
racy-related penalties under §§ 6662(b)(1)
and 6662(b)(2) of the Code. In general, the
special procedures allowed these taxpay-
ers to avoid or reduce the accuracy-related
penalties to the extent that items result-
ing in additional tax were reported, or a
position contrary to a rule was adequately
disclosed, in a written statement furnished
to the IRS within a 15-day window begin-
ning with the IRS’s written request for
such statement.
.13 In 2019, the IRS replaced the CIC
Program with the Large Corporate Com-
pliance Program (LCC) effective for
audits for taxable years 2017 and later. See
IRS News Release: IR-2019-95 (May 16,
2019), LB&I Announces Large Corporate
Compliance Program. Under the LCC,
large corporate taxpayers are selected for
examination based on their risk profiles
and data analytics. Large corporate tax-
payers are no longer subject to planned
continuous examinations.
.14 The IRS also implemented the
Large Partnership Compliance Program
(LPC) to address the IRS’s compliance
approach to large partnerships. See Interim
Guidance Memo: LB&I-04-1021-0017
(October 21, 2021), Interim Guidance on
Implementation of the Large Partnership
Compliance Pilot Program.
.15 On May 21, 2019, the IRS
announced that, as a transition, Rev. Proc.
94-69 would continue to apply to any tax-
payer that was both in the CIC (with an
open CIC examination as of May 2019
for taxable year 2016 and earlier taxable
years) and the LCC (for taxable year 2017
and later taxable years). See Interim Guid-
ance Memo: LB&I-04-0419-004 (May 21,
2019), Interim Guidance on Implementa-
tion of the Large Corporate Compliance
(LCC) Program.

Bulletin No. 2022–49 509 December 5, 2022
.16 On August 19, 2020, the IRS
requested comments concerning obsolet-
ing Rev. Proc. 94-69. See IRS Statements
and Announcements, IRS Seeks Comments
on Revenue Procedure 94-69 (Aug. 19,
2020), at https://www.irs.gov/newsroom/
irs-seeks-comments-on-revenue-proce-
dure-94-69. The comments received con-
tended that both large corporate taxpayers
and the IRS have benefited from using
Rev. Proc. 94-69 to allow those taxpay-
ers to disclose errors on their returns at
the start of an audit. The IRS has deter-
mined that for a subset of large corporate
taxpayers and large partnerships whose
tax posture is likely to result in near-an-
nual examinations, special procedures are
appropriate for disclosure of errors on a
return or items that may result in an under-
payment but have a reasonable basis.
.17 The procedures set forth in this
revenue procedure allow eligible taxpay-
ers to avoid the accuracy-related penalty
described in §§ 6662(b)(1) and 6662(b)(2)
to the extent that the taxpayer reports errors
resulting in additional tax or adequately
discloses the tax treatment of an item that
has a reasonable basis as provided in sec-
tion 4 of this revenue procedure.
.18 The special procedures set forth in
this revenue procedure are intended for
the disclosure of errors and omissions
that were not known at the time of filing
a return.
SECTION 3. SCOPE
.01 Eligible taxpayers. The special pro-
cedures set forth in this revenue procedure
are available to eligible taxpayers. An
“eligible taxpayer” means any taxpayer
selected for examination under the LCC
(or successor program) if, on the date on
which the IRS first contacts the taxpayer
concerning an examination of an income
tax return, at least four of the taxpayer’s
income tax returns for the five taxable
years preceding the taxable year at issue
are (or were) under examination under the
LCC, the CIC, or a successor program. An
eligible taxpayer also means any partner-
ship selected for examination under the
LPC (or successor program) if, on the date
on which the IRS first contacts the part-
nership concerning an examination of a
return of partnership income, at least four
of the partnership’s returns for the five
taxable years preceding the taxable year
at issue are (or were) under examination
under the LPC (or successor program).
Taxpayers selected for examination under
the LCC or the LPC will be notified by the
IRS if they are eligible taxpayers under
this revenue procedure.
.02 Procedures for ineligible taxpay-
ers. Taxpayers not eligible for, or making
disclosures beyond the scope of, the spe-
cial procedures set forth in this revenue
procedure have the opportunity to utilize
existing methods to avoid the imposition
of penalties, including by filing a qualified
amended return as described in and satis-
fying the requirements of § 1.6664-2(c)
(3), or by adequately disclosing the posi-
tion on a properly completed Form 8275,
Form 8275-R, or Schedule UTP, Uncer-
tain Tax Position Statement, filed with a
return and satisfying the requirements of
§1.6662-3(c).
SECTION 4. QUALIFIED AMENDED
RETURN ON FORM 15307
.01 For purposes of avoiding the impo-
sition of the penalty under § 6662(b)(1)
for negligence or disregard of rules or reg-
ulations, and the substantial understate-
ment penalty under § 6662(b)(2), a prop-
erly completed Form 15307, Post-Filing
Disclosure for Specified Large Business
Taxpayers (or successor form), is treated
as a qualified amended return with respect
to a particular taxable year of an eligi-
ble taxpayer if an eligible taxpayer fur-
nished it to the IRS personnel conducting
the examination after the tax return with
respect to the particular taxable year has
been filed but no later than 30 days (or a
later date agreed to in writing by the IRS
with respect to a particular taxable year)
from the date of a written request to the
taxpayer that Form 15307 be furnished
with respect to that taxable year.
.02 The taxpayer must include a
description of all items that would result
in one or more adjustments with respect
to a particular taxable year if the taxpayer
filed a properly completed amended return
with respect to that taxable year, or request
for an administrative adjustment under §
6227. The description of an item is ade-
quate if it consists of information that rea-
sonably may be expected to apprise the
IRS of the identity of the item, its amount,
and the nature of the controversy or poten-
tial controversy. Each disclosed adjust-
ment with respect to the particular taxable
year must be stated separately.
.03 The taxpayer need not include a
recomputation of total tax liability with
respect to the particular taxable year with
Form 15307. Similarly, if an item auto-
matically affects another item with respect
to that taxable year, the Form 15307 need
not include a recomputation of the affected
item. The taxpayer is required to include a
computation of the increase (or decrease)
in taxable income, or the increase (or
decrease) to tax credits if the disclosure
relates to tax credits, with respect to each
item disclosed on the Form 15307.
.04 The taxpayer may also disclose
information for purposes of establishing
the reasonable basis of a position even
though the taxpayer does not report any
items that would result in adjustments
with respect to the particular taxable year.
.05 Any additional tax liability with
respect to the particular taxable year
resulting from the adjustments identified
in a written statement described in sections
4.01 through 4.03 of this revenue proce-
dure that is agreed at the conclusion of the
examination will be treated as an addi-
tional amount of tax shown on a qualified
amended return for purposes of determin-
ing whether there is an underpayment of
tax with respect to that taxable year sub-
ject to penalty under §§ 6662(b)(1) and
6662(b)(2). Any additional tax liability
resulting from adjustments identified in
the written statement with respect to a par-
ticular taxable year that is unagreed at the
conclusion of the examination (1) will be
subject to the deficiency procedures pre-
scribed by §§ 6212 and 6213, or the part-
nership audit procedures prescribed by
§§ 6221 through 6241, as applicable; (2)
will not reduce the underpayment subject
to penalty under § 6662(b)(1) for negli-
gence; and (3) will not reduce the penalty
for substantial understatement of income
tax unless there was a reasonable basis for
the taxpayer’s tax treatment of the item
identified in the written statement.
.06 Failure to Provide Adequate
Disclosure.
(1) A disclosure based on incomplete
information, unreasonable assumptions,
or otherwise not in conformity with the
requirements of this revenue procedure

December 5, 2022 510 Bulletin No. 2022–49
and the Form 15307 furnished to the
IRS with respect to a particular taxable
year will be considered an inadequate
disclosure.
(2) A taxpayer deemed to have made
an inadequate disclosure will not receive
penalty protection under this process with
respect to the item or items inadequately
disclosed with respect to the particular
taxable year. The IRS will inform the tax-
payer of any determination that a disclo-
sure is inadequate.
SECTION 5. EFFECT ON OTHER
DOCUMENTS
Rev. Proc. 94-69 is obsoleted. “Rev.
Proc. 2022-39” should be substituted for
“Rev. Proc. 94-69” in any other revenue
procedure that refers to Rev. Proc. 94-69.
SECTION 6. EFFECTIVE DATE
.01 This revenue procedure is effective
for examinations of eligible taxpayers that
begin after November 16, 2022, the date
this revenue procedure was released to the
public.
.02 The transition relief described in
section 2.15 of this revenue procedure con-
tinues to apply to the taxpayers eligible for
such relief with respect to examinations of
taxable year 2020 and earlier years. The
transition relief described in section 2.15
of this revenue procedure does not apply
with respect to the examination of taxable
year 2021 and later years. For examina-
tions of taxable year 2021 and later years,
taxpayers who were eligible for the tran-
sition relief described in section 2.15 of
this revenue procedure can only utilize the
special procedures set forth in this reve-
nue procedure if the taxpayer meets the
eligibility requirements described in sec-
tion 3 of this revenue procedure.
SECTION 7. DRAFTING
INFORMATION
The principal author of this revenue
procedure is Jessica Chase of the Office
of the Associate Chief Counsel (Procedure
and Administration). For further informa-
tion regarding this revenue procedure,
contact Ms. Chase at (202) 317-6845 (not
a toll-free number).

Bulletin No. 2022–49 511 December 5, 2022
Part IV
Notice of Proposed
Rulemaking
Guidance Related to the
Foreign Tax Credit
REG-112096-22
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Notice of proposed rulemaking.
SUMMARY: This document contains
proposed regulations relating to the for-
eign tax credit, including guidance with
respect to the reattribution asset rule for
purposes of allocating and apportioning
foreign taxes, the cost recovery require-
ment, and the attribution rule for with-
holding tax on royalty payments.
DATES: Written or electronic comments
and requests for a public hearing must be
received by January 23, 2023.
ADDRESSES: Commenters are strongly
encouraged to submit public comments
electronically. Submit electronic submis-
sions via the Federal eRulemaking Por-
tal at www.regulations.gov (indicate IRS
and REG-112096-22) by following the
online instructions for submitting com-
ments. Once submitted to the Federal
eRulemaking Portal, comments cannot
be edited or withdrawn. The Department
of the Treasury (the “Treasury Depart-
ment”) and the Internal Revenue Ser-
vice (the “IRS”) will publish for public
availability any comment submitted
electronically, and on paper, to its pub-
lic docket. Send hard copy submissions
to: CC:PA:LPD:PR (REG-112096-22),
Room 5203, Internal Revenue Service,
PO Box 7604, Ben Franklin Station,
Washington, DC 20044. Submissions
may be hand delivered Monday through
Friday between the hours of 8 a.m. and
4 p.m. to CC:PA:LPD:PR (REG-112096-
22), Courier’s Desk, Internal Revenue
Service, 1111 Constitution Avenue, NW,
Washington, DC 20224.
FOR FURTHER INFORMATION
CONTACT: Concerning §§1.901-2 and
1.903-1, Teisha Ruggiero, (646) 259-
8116; concerning §1.861-20, Suzanne
Walsh, (202) 317-4908; concerning sub-
missions of comments and requests for
a public hearing, Regina Johnson, (202)
317-6901 (not toll-free numbers) or by
sending an email to publichearings@irs.
gov (preferred).
SUPPLEMENTARY INFORMATION:
Background
On December 17, 2019, the Treasury
Department and the IRS published pro-
posed regulations (REG-105495-19)
addressing changes made by the Tax Cuts
and Jobs Act (Pub. L. 115-97, 131 Stat.
2054 (2017)) (the “TCJA”) and other
related foreign tax credit rules in the Fed-
eral Register (84 FR 69124) (the “2019
Foreign Tax Credit (“FTC”) proposed
regulations”). Correcting amendments
to the 2019 FTC proposed regulations
were published in the Federal Register
on May 15, 2020 (85 FR 29368). The
2019 FTC proposed regulations were
finalized as part of TD 9922, published
in the Federal Register (85 FR 71998)
on November 12, 2020 (the “2020 FTC
final regulations”). On the same date,
the Treasury Department and the IRS
published proposed regulations (REG-
101657-20) in the Federal Register (85
FR 72078) (the “2020 FTC proposed reg-
ulations”). The 2020 FTC proposed reg-
ulations addressed changes made by the
TCJA and other foreign tax credit issues.
Correcting amendments to the 2020 FTC
final regulations were published in the
Federal Register on October 1, 2021 (86
FR 54367). A public hearing on the 2020
FTC proposed regulations was held on
April 7, 2021. The 2020 FTC proposed
regulations were finalized in TD 9959,
published in the Federal Register (87
FR 276) on January 4, 2022 (the “2022
FTC final regulations”). Correcting
amendments to the 2022 FTC final reg-
ulations were published in the Federal
Register on July 27, 2022 (87 FR 45018
and 87 FR 45021).
This document contains proposed
regulations (the “proposed regulations”)
addressing the following issues: (1) the
definition of a reattribution asset for pur-
poses of allocating and apportioning for-
eign income taxes; (2) the application of
the cost recovery requirement; and (3) the
application of the source-based attribution
requirement to withholding taxes on cer-
tain royalty payments.
Explanation of Provisions
I. Allocation and Apportionment of
Foreign Income Taxes
A. In general
Section 1.861-20 provides rules for
allocating and apportioning foreign
income taxes to the statutory and resid-
ual groupings, including the categories
described in section 904 that apply for
purposes of calculating a taxpayer’s for-
eign tax credit limitation. In general,
§1.861-20 operates by first assigning the
foreign gross income on which the foreign
income tax is imposed to statutory and
residual groupings based upon the charac-
ter of the item of U.S. gross income that
corresponds to the foreign gross income
(the “corresponding U.S. item”). §1.861-
20(c) and

(d). Foreign income tax expense
is allocated to the grouping to which the
foreign gross income is assigned, and if
foreign gross income is assigned to more
than one grouping, deductions computed
under foreign law are allocated and appor-
tioned to the groupings and foreign tax
expense is apportioned among the group-
ings based upon foreign taxable income in
the groupings. §1.861-20(e) and (f).
The 2022 FTC final regulations provide
rules for allocating and apportioning for-
eign income tax arising from a disregarded
payment. Foreign gross income included
by reason of the receipt of a disregarded
payment has no corresponding U.S. item
because Federal income tax law does not
give effect to the payment as a receipt of
gross income. Section 1.861-20(d)(3)(v)
therefore characterizes the disregarded
payment under Federal income tax law
for purposes of assigning this foreign

December 5, 2022 512 Bulletin No. 2022–49
gross income to the statutory and residual
groupings. These rules treat the portion of
a disregarded payment, if any, that causes
U.S. gross income of the payor taxable
unit to be reattributed under either §1.904-
4(f)(2) (in the case of a taxpayer that is
an individual or domestic corporation)
or §1.951A-2(c)(7)(ii)(B) (in the case of
a taxpayer that is a foreign corporation)
to the recipient taxable unit as a “reattri-
bution payment.” §1.861-20(d)(3)(v)(E)
(7); see also part I.B of this Explanation
of Provisions for a description of the reat-
tribution payment rules. The excess of a
disregarded payment over the portion that
is a reattribution payment is treated either
as a contribution from one taxable unit
to another taxable unit owned by the first
taxable unit, or as a remittance of a taxable
unit’s current and accumulated earnings.
§1.861-20(d)(3)(v)(E)(2) and (8). Section
1.861-20(d)(3)(v)(D) provides a special
rule for characterizing disregarded pay-
ments that are made in exchange for prop-
erty and are not reattribution payments.
B. Reattribution payments, remittances,
and the reattribution of assets
Section 1.861-20(d)(3)(v)(B) assigns
foreign gross income from a disregarded
payment that is a reattribution payment
to the same statutory and residual group-
ing as the U.S. gross income that is reat-
tributed to the recipient taxable unit. This
assignment occurs before taking into
account any reattribution payments made
by the recipient taxable unit.
Foreign gross income included by rea-
son of a remittance is assigned to the stat-
utory and residual groupings by reference
to the proportion of the tax book value of
the assets of the remitting taxable unit in
the groupings as assigned for purposes
of apportioning interest expense. §1.861-
20(d)(3)(v)(C)(1)(i). In other words, the
character of the assets of the remitting
taxable unit is a proxy for the character of
the current and accumulated earnings out
of which the remittance is made. To more
accurately reflect the character of the
remitting taxable unit’s earnings, the reat-
tribution asset rule in §1.861-20(d)(3)(v)
(C)(1)(ii) requires that a reattribution of
income from one taxable unit (payor tax-
able unit) to another taxable unit (recip-
ient taxable unit) result in a concomitant
reattribution of the tax book value of the
assets of the payor taxable unit that gen-
erated the reattributed income (“reattribu-
tion assets”) from the payor taxable unit to
the recipient taxable unit.
After further study, the Treasury
Department and the IRS have concluded
that the reattribution asset rule is not
needed for allocating and apportioning
foreign tax on a remittance in the case of
disregarded property sales, and particu-
larly with respect to disregarded sales of
inventory property. For example, consider
a domestic corporation that directly owns
two taxable units that are disregarded for
U.S. Federal income tax purposes: DE1,
which manufactures inventory prop-
erty, and DE2, which distributes inven-
tory property to unrelated customers.
DE1 sells the manufactured inventory to
DE2 in exchange for a disregarded pay-
ment. The disregarded payment that DE1
receives for the sale of inventory property
to DE2 becomes a reattribution payment
when DE2 on-sells the inventory property
and generates gain in a transaction that is
regarded for U.S. tax purposes. Accord-
ingly, gain from the sale of the inventory is
reattributed from the distributing taxable
unit to the manufacturing taxable unit, and
a portion of the distributing taxable unit’s
assets is reattributed to the manufactur-
ing taxable unit. Although the assets of
the manufacturing taxable unit contrib-
uted to the production of the income of
both taxable units, the tax book value of
the manufacturing taxable unit’s assets is
not reattributed to the distributing taxable
unit. As a result, the reattribution asset
rule, by reattributing assets only from the
distributor taxable unit to the manufactur-
ing taxable unit, does not more accurately
balance among the taxable units all of the
assets that produced the gain from the
inventory sale. The reattribution of assets
instead changes the ratios of the assets
considered held by the taxable units such
that a greater percentage of the distribu-
tor taxable unit’s assets consist of non-in-
ventory assets (for example, cash), and a
greater percentage of the manufacturing
taxable unit’s assets consist of inventory.
Accordingly, proposed §1.861-20(d)
(3)(v)(E)(6) retains the general definition
of reattribution asset but excludes any
portion of the tax book value of property
transferred in a disregarded sale from
being attributed back to the selling tax-
able unit. Comments are requested on
whether similar revisions should be made
to the reattribution asset rule in situations
other than disregarded property sales.
Comments are further requested on other
issues related to the allocation and appor-
tionment of foreign income taxes to disre-
garded payments, which may be consid-
ered in future guidance projects.
II. Creditability of Foreign Taxes Under
Sections 901 and 903
A. In general
Section 901 allows a credit for foreign
income, war profits, and excess profits
taxes, and section 903 provides that such
taxes include a tax in lieu of a general-
ly-imposed foreign income, war profits,
or excess profits tax (collectively, “foreign
income taxes”). Before its amendment by
the 2022 FTC final regulations, §1.901-
2(a)(1) provided that a foreign levy was
an income tax if and only if (1) it was a
tax, and (2) the predominant character of
that tax was that of an income tax in the
U.S. sense. Under former §1.901-2(a)(3),
the predominant character of a foreign tax
was that of an income tax in the U.S. sense
if the tax (1) was likely to reach net gain
in the normal circumstances in which it
applied (the “net gain requirement”), and
(2) was not a “soak-up” tax. To satisfy the
net gain requirement, a foreign tax needed
to meet the realization, gross receipts,
and net income requirements. See former
§1.901-2(b).
The 2022 FTC final regulations revised
the net gain requirement to better align
the regulatory tests with principles in
the Internal Revenue Code (“Code”) for
determining the base of a U.S. income tax,
as well as to simplify and clarify the appli-
cation of these tests. The revisions made
by the 2022 FTC final regulations ensure
that a foreign tax is a creditable net income
tax only if the determination of the foreign
tax base conforms in essential respects to
the determination of taxable income under
the Code. In particular, the 2022 FTC final
regulations limit the role of the predomi-
nant character analysis generally required
under the prior regulations, which often
required empirical analysis, in determin-
ing whether a foreign tax meets each of

Bulletin No. 2022–49 513 December 5, 2022
the net gain requirements. Under the 2022
FTC final regulations, a foreign tax satis-
fies the net gain requirement only if the tax
satisfies the realization requirement, the
gross receipts requirement, the cost recov-
ery requirement (formerly the net income
requirement), and the attribution require-
ment. In addition, the 2022 FTC final reg-
ulations provide that the determination of
whether a foreign tax satisfies each com-
ponent of the net gain requirement is gen-
erally based on the terms of the foreign tax
law governing the computation of the tax
base and not based on empirical analysis.
§1.901-2(b)(1). The 2022 FTC final regu-
lations also maintained the long-standing
all-or-nothing rule; that is, a foreign tax
either is or is not a foreign income tax, in
its entirety, for all persons subject to the
foreign tax. §1.901-2(a)(1)(i).
B. Cost recovery requirement
1. Application under 2022 FTC final
regulations
Consistent with the net income require-
ment in former §1.901-2(b)(4), the 2022
FTC final regulations require, under the
cost recovery requirement, that the base of
a foreign tax permits the recovery of sig-
nificant costs and expenses attributable,
under reasonable principles, to the gross
receipts included in the tax base. §1.901-
2(b)(4)(i)(A). However, to ensure that a
foreign tax is a foreign income tax only if
the foreign tax allows for the recovery of
costs and expenses in a manner that con-
forms in essential respects to the determi-
nation of taxable income under the Code,
and to limit the empirical analysis that
would otherwise be required, the 2022
FTC final regulations modified the cost
recovery requirement in several respects.
For example, the 2022 FTC final regula-
tions provide a list of costs and expenses
that are always treated as significant (costs
and expenses related to capital expendi-
tures, interest, rents, royalties, wages or
other payments for services, and research
and experimentation). §1.901-2(b)(4)(i)
(C)(1). Whether other costs and expenses
are significant continues to be determined
under an empirical analysis; that is, based
on whether, for all taxpayers in the aggre-
gate to which the foreign tax applies,
the item of cost or expense constitutes a
significant portion of the taxpayers’ total
costs and expenses. Id.
However, the 2022 FTC final regula-
tions also recognized that, similar to the
United States, foreign countries limit the
recovery of certain significant costs and
expenses. As a result, §1.901-2(b)(4)
(i)(C)(1) provides that foreign tax law
is considered to permit the recovery of
significant costs and expenses, even if
recovery of certain significant costs and
expenses is disallowed in whole or in part,
if such disallowance is consistent with
any principle underlying the disallow-
ances required under the Code (“princi-
ples-based exception”).
2. Response to the 2022 FTC final
regulations
Following the publication of the
2022 FTC final regulations, the Treasury
Department and the IRS have received a
number of questions regarding the appli-
cation of the cost recovery requirement as
well as requests to modify the requirement.
In particular, taxpayers and other stake-
holders identified a number of foreign tax
laws that impose disallowances or other
limitations on the recovery of costs and
expenses that are not clearly matched to
a principle underlying a similar disallow-
ance under the Code, even though, in the
view of these stakeholders, the foreign tax
as a whole is consistent with a net income
tax in the U.S. sense. Moreover, taxpayers
noted that, in some instances, it was diffi-
cult to determine the principle underlying
the foreign disallowance because of a lack
of information from the foreign country.
The Treasury Department and the IRS
agree that, in certain instances, the cost
recovery requirement should be satis-
fied even if the foreign tax law contains
a disallowance or other limitation on the
recovery of a particular cost or expense
that may not reflect a specific principle
underlying a particular disallowance in
the Code. The income tax provisions of
the Code contain a number of disallow-
ances and other limitations on the deduct-
ibility of certain costs and expenses. In
some instances, the principle or princi-
ples behind the limitation is clear, either
because the motivation is articulated in
legislative history or because it is possible
to determine the principle from the terms
of the limitation itself. However, the prin-
ciples underlying other limitations may be
less apparent, making it difficult to deter-
mine whether a foreign limitation on the
deductibility of certain costs and expenses
is consistent with any principle underlying
the disallowances under the Code.
As explained in the preamble to the
2022 FTC final regulations, section 901
allows credits for foreign taxes that are
income taxes in the U.S. sense, and this
standard is met if there is substantial con-
formity in the principles used to calculate
the foreign tax base and the U.S. tax base.
Complete conformity between the rules
for determining the foreign tax base and
the U.S. tax base is not required. Accord-
ingly, the proposed regulations provide
additional guidance for evaluating disal-
lowances under foreign tax law that may
not mirror the expense disallowance rules
in the Code, but that nonetheless do not
prevent the foreign tax from being a tax
imposed on net income.
Proposed §1.901-2(b)(4)(i) retains the
general cost recovery requirement under
the 2022 FTC final regulations, but pro-
vides that the relevant foreign tax law need
only permit recovery of substantially all
of each item of significant cost or expense.
Consistent with the general approach of
the 2022 FTC final regulations, whether
a foreign tax permits recovery of substan-
tially all of each item of significant cost
or expense is determined based solely on
the terms of the foreign tax law. Proposed
§1.901-2(b)(4)(i)(C)(1).
Proposed §1.901-2(b)(4)(i)(C)(2) pro-
vides a safe harbor for purposes of apply-
ing this requirement. Under the safe har-
bor, a disallowance of a stated portion of
an item (or multiple items) of significant
cost or expense does not prevent a for-
eign tax from satisfying the cost recovery
requirement if the portion of the item (or
items) that is disallowed does not exceed
25 percent. This safe harbor also permits
the foreign tax law to cap deductions of a
single item of significant cost or expense
or multiple items that relate to a single
category of per se significant costs and
expenses described in proposed §1.901-
2(b)(4)(i)(B)(2) so long as the cap, based
solely on the terms of the foreign tax
law, is not less than 15 percent of gross
receipts, gross income, or a similar mea-
sure, or in the case of a cap based on a

December 5, 2022 514 Bulletin No. 2022–49
percentage of taxable income, or a sim-
ilar measure, the cap is not less than 30
percent. A foreign law limitation that caps
deductions of multiple items that relate to
different categories of per se significant
costs and expenses at a stated percentage
(for example, a cap on the deduction of all
interest and royalties, combined, at 15 per-
cent of gross receipts), or that caps deduc-
tions of multiple items of significant costs
or expense that are significant under pro-
posed §1.901-2(b)(4)(i)(B)(1) at a stated
percentage, would not meet the safe har-
bor. The safe harbor is intended to provide
additional certainty where a foreign tax
law disallowance is in the form of a stated
portion or cap. Taxpayers will not need to
identify a corresponding principle under-
lying the disallowances required under the
Code for foreign tax law disallowances
that meet the safe harbor. If the foreign
tax law contains a disallowance that is not
within the safe harbor, and that otherwise
prevents the recovery of substantially all
of an item of significant cost or expense,
then the limitation would be examined
under the principles-based exception from
the 2022 FTC final regulations, retained in
proposed §1.901-2(b)(4)(i)(F)(1), which
permits more substantial disallowances
(including complete disallowances) of an
item of significant cost or expense that
are consistent with any principle under-
lying the disallowances required under
the Code. The proposed regulations make
additional clarifications to this rule, to pro-
vide that the principle must be reflected
in a disallowance within the income tax
provisions of the Code, and if the disal-
lowance addresses a non-tax public policy
concern, then such concern must be simi-
lar to the non-tax public policy concerns
reflected in the Code. In addition, the pro-
posed regulations remove the example of
a limit on recovery of interest based upon
a measure of taxable income from this
principles-based exception because such
a limitation would generally be covered
by the safe harbor. See proposed §1.901-
2(b)(4)(iv)(H) (Example 8). If the foreign
law disallowance does not meet the safe
harbor or otherwise permit recovery of
substantially all of each item of signifi-
cant cost or expense, the principles-based
exception would be relevant for determin-
ing whether the foreign tax could satisfy
the cost recovery requirement.
Additionally, proposed §1.901-2(b)(4)
(iv)(F) through (J) provide new exam-
ples illustrating the application of the cost
recovery requirement. The proposed reg-
ulations also reorganize the provisions of
the cost recovery requirement to accom-
modate the addition of these new provi-
sions, as well as to better reflect the struc-
ture of the requirement.
C. Attribution requirement for royalty
payments
1. Application under 2022 FTC final
regulations
The 2022 FTC final regulations added
an attribution requirement in §1.901-2(b)
(5) as an element of the net gain require-
ment to require that a foreign tax con-
form to the concepts of taxing jurisdiction
reflected in the Code that define an income
tax in the U.S. sense. The purpose of the
attribution requirement is to allow a credit
for a foreign tax only if the country impos-
ing the tax has sufficient nexus to the tax-
payer’s activities or investment of capital
that generates the income included in the
tax base. This result is consistent with
the statutory purpose of the foreign tax
credit to relieve double taxation of income
through the United States ceding its own
taxing rights only where the foreign coun-
try has the primary right to tax the income.
With respect to a foreign levy imposed
on nonresident taxpayers, the attribution
requirement limits the scope of gross
receipts and costs included in the base
of a foreign tax to those that satisfy the
activities-based attribution, source-based
attribution, or property-based attribution
tests. §1.901-2(b)(5)(i). These tests are
consistent with U.S. income tax principles
reflected in the Code’s provisions that only
tax foreign persons’ income that is effec-
tively connected with a U.S. trade or busi-
ness or attributable to U.S. real property,
or that is fixed or determinable annual or
periodical (FDAP) income sourced in the
United States.
Under the source-based attribution
requirement in §1.901-2(b)(5)(i)(B), a
foreign tax imposed on the nonresident’s
income on the basis of source meets the
attribution requirement only if the foreign
tax law’s sourcing rules are reasonably
similar to the sourcing rules that apply
for Federal income tax purposes. In the
case of gross income arising from royal-
ties, §1.901-2(b)(5)(i)(B)(2) provides that
the foreign tax law must source royalties
based on the place of use of, or the right
to use, the intangible property, consis-
tent with how the Code sources royalty
income.
For foreign taxes imposed in lieu of an
income tax, the 2022 FTC final regulations
also modified the substitution requirement
in §1.903-1, including by adding an attri-
bution requirement. Under §1.903-1(c)
(2)(iii), a foreign withholding tax must
meet the source-based attribution require-
ment in §1.901-2(b)(5)(i)(B) to qualify as
a “covered withholding tax” that may be
creditable as a tax in lieu of an income tax.
Thus, a withholding tax on a royalty pay-
ment is creditable only if the foreign tax
law sources royalties based upon the place
of use of, or the right to use, the intan-
gible property, consistent with how the
Code sources royalty income. The 2022
FTC final regulations also maintained
the all-or-nothing rule for the substitution
requirement; that is, a foreign tax either is
or is not a tax in lieu of an income tax,
in its entirety, for all persons subject to
the foreign tax. §1.903-1(b)(1). Accord-
ingly, a withholding tax on royalties that
is imposed on the basis of the residence of
the payor of the royalty is not creditable,
whether or not the relevant intangible
property is in fact used within the territory
of the taxing jurisdiction. §1.903-1(d)(3)
and (4) (Examples 3 and 4).
The determination of whether a for-
eign levy meets the requirements under
§§1.901-2 and 1.903-1 is made on a levy-
by-levy basis. Section 1.901-2(d) provides
rules for determining whether one foreign
levy is separate from another foreign
levy. In general, §1.901-2(d)(1)(ii) pro-
vides that separate levies are imposed on
particular classes of taxpayers if the tax
base is different for those taxpayers. The
2022 FTC final regulations added a spe-
cial rule for withholding taxes imposed on
nonresidents that treats each such tax as
a separate levy with respect to each class
of gross income (as listed in section 61)
to which the tax applies. §1.901-2(d)(1)
(iii). This rule allows withholding taxes
that are imposed on classes of income that
are subject to different sourcing rules of
the taxing jurisdiction to be analyzed as

Bulletin No. 2022–49 515 December 5, 2022
separate levies under the covered with-
holding tax requirement in §1.903-1(c)
(2). The 2022 FTC final regulations also
provided that if a foreign country imposes
a withholding tax on two or more subsets
of a separate class of income and a dif-
ferent source rule applies to each subset
of income, then separate levies are con-
sidered imposed on each subset of that
separate class of income. §1.901-2(d)(1)
(iii). These special rules reflect the general
principle in §1.901-2(d)(1) that the sepa-
rate levy determination is based upon U.S.
principles and not whether foreign tax law
imposes the levy or levies pursuant to a
single or separate statutes. The rules also
enable testing the creditability of a with-
holding tax on a more granular basis. This
approach better reflects the purpose of the
attribution requirement to allow a foreign
tax credit only where, in the U.S. view, the
taxing jurisdiction has the primary right to
tax the income.
2. Response to the 2022 FTC final
regulations
Following the publication of the
2022 FTC final regulations, the Treasury
Department and the IRS received ques-
tions regarding the application of the
source-based attribution requirement to
certain royalty withholding taxes. In addi-
tion, the Treasury Department and the IRS
received requests (including a petition for
rulemaking) to change the requirement, by
allowing a credit even if a foreign country
sources royalties based on the residence
of the payor or by applying a different
standard.
1

As an initial matter, some taxpayers
questioned whether the sourcing rule for
royalties was applied differently than that
for services because §1.901-2(b)(5)(i)(B)
(1) includes a reference to the use of “rea-
sonable principles” for purposes of apply-
ing the source-based attribution require-
ment to a payment for services, while the
equivalent rule in §1.901-2(b)(5)(i)(B)
(2) for royalties does not. Since the intro-
ductory text in §1.901-2(b)(5)(i)(B) states
that, in all instances, sourcing rules must
be reasonably similar to the sourcing rules
under the Code, the same standard applies
regardless of whether the relevant pay-
ment is for services or for royalties. How-
ever, to avoid further confusion, the pro-
posed regulations conform the language
of §1.901-2(b)(5)(i)(B)(1) and (2).
Additionally, the Treasury Department
and the IRS are aware that, in some cases,
a taxpayer may license intangible property
for use solely within the foreign country
in which the licensee is resident, but the
foreign country sources royalties based on
the residence of the payor. In these cases,
notwithstanding the actual use of the
licensed property in the taxing jurisdic-
tion, a credit would not be allowed for the
royalty withholding tax under the source-
based attribution requirement for royal-
ties in §1.901-2(b)(5)(i)(B). However, in
these cases, the foreign country imposing
tax on the royalty income should, from a
U.S. perspective, have the primary tax-
ing right over the royalty income because
the intangible property giving rise to the
royalty is in fact being used solely in that
foreign country. That is, notwithstanding
the difference in sourcing rules for roy-
alty income, there is complete overlap
between the jurisdiction with the primary
right to tax based on U.S. tax principles
and the taxing rights exercised by the tax-
ing jurisdiction.
The Treasury Department and the
IRS have concluded that it is appropri-
ate to provide a limited exception to the
source-based attribution requirement of
the 2022 FTC final regulations where the
taxpayer can substantiate that a withhold-
ing tax is imposed on royalties received
in exchange for the right to use intangible
property solely within the territory of the
taxing jurisdiction. The Treasury Depart-
ment and the IRS have concluded that it
would be unduly burdensome for both
the taxpayer and the IRS to determine the
place of use of all intangible property on
a country-by-country basis based on each
taxpayer’s facts and circumstances. While
taxpayers may need to determine the place
of use of certain intangible property to
determine whether the royalty income is
U.S. or foreign source, or for other pur-
poses, those determinations generally do
not require taxpayers or the IRS to sepa-
rately determine the use in a specific for-
eign country. For this reason, this limited
exception applies only if the taxpayer has
a written license agreement that provides
for the payment of the royalty and that
limits the use of the intangible property
giving rise to the royalty payment to the
territory of the foreign country imposing
the tax.
3. The single-country exception
Reflecting this new limited exception,
proposed §1.903-1(c)(2)(iii) provides that
a tested foreign tax satisfies the source-
based attribution requirement if the tax
meets either the source-based attribution
requirement in §1.901-2(b)(5)(i)(B) or the
exception in proposed §1.903-1(c)(2)(iii)
(B) (the “single-country exception”).
In general, the single-country excep-
tion applies where (1) the income subject
to the tested foreign tax is characterized as
gross royalty income, and (2) the payment
giving rise to such income is made pursu-
ant to a single-country license. Proposed
§1.903-1(c)(2)(iii)(B). Consistent with
§1.901-2(b)(5)(i)(B), proposed §1.903-
1(c)(2)(iii)(B) provides that foreign tax
law generally applies for purposes of
determining whether the gross income
or gross receipts arising from a transac-
tion are characterized as a royalty, except
in the case of a transaction that is con-
sidered the sale of a copyrighted article
under §1.861-18, which is not treated as a
license of intangible property but as a sale
of tangible property.
A payment is made pursuant to a sin-
gle-country license if the terms of the
written license agreement under which the
payment is made characterize the payment
as a royalty and limit the territory of the
license to the foreign country imposing
the tested foreign tax. Proposed §1.903-
1(c)(2)(iv)(A). However, a payment (or
1
The Treasury Department and the IRS received a petition for rulemaking with respect to the attribution requirement as applied to a tax on a resident but declined to engage in rulemaking
on that subject. The Treasury Department and the IRS have determined that the attribution requirement as contained in the 2022 FTC final regulations, including as applied to residents,
is appropriate to ensure that a foreign tax is consistent with the general principles of income taxation reflected in the Code. These principles include not only those related to determining
realization, gross receipts, and cost recovery, but also principles for determining the scope of the items of gross receipts and costs that may be properly taken into account in computing the
tax base on which the foreign tax is imposed.

December 5, 2022 516 Bulletin No. 2022–49
portion of a payment) may be treated as
made pursuant to a single-country license
even if the written agreement does not
limit the territory of the license to the for-
eign country imposing the tax or provides
for payments in addition to those for the
use of intangible property (for example,
for related services), if the agreement sep-
arately states the portion (whether as a
specified amount or as a formula) of the
payment subject to the tested foreign tax
that is characterized as a royalty and that
is with respect to the part of the territory of
the license that is solely within the foreign
country imposing the tax. See proposed
§§1.903-1(c)(2)(iv)(B) and (d)(9) (Exam-
ple 9).
The Treasury Department and the
IRS are aware that, to qualify for the sin-
gle-country exception, taxpayers may
need to revise existing license agreements.
Additionally, because certain withholding
taxes may remain non-creditable, taxpay-
ers may be incentivized to maximize the
portion of a payment that is made pursuant
to a single-country license. For example,
a taxpayer that receives royalty payments
pursuant to a related-party license agree-
ment that grants the licensee rights to
several different types of intangible prop-
erty—some of which will be exploited
solely within the taxing jurisdiction and
some outside of the taxing jurisdiction—
may be incentivized to amend the relat-
ed-party license agreement to separately
state a royalty amount that purports to
qualify for the single-country exception
but that may exceed an amount that, under
the arm’s length principles of section
482 and sourcing principles of section
861, is attributable to the exploitation of
the intangible property within the taxing
jurisdiction. Additionally, taxpayers may
be disincentivized from revising existing
agreements to reflect changes in facts and
circumstances if doing so would decrease
the amount of the royalty that is eligible
for the single-country exception.
To address these concerns, proposed
§1.903-1(c)(2)(iv)(C) provides that a
payment is treated as not made pursuant
to a single-country license if the taxpayer
knows, or has reason to know, that the
required agreement misstates the territory
in which the intangible property is used
or overstates the amount of the royalty
with respect to the part of the territory of
the license that is solely within the for-
eign country imposing the tax. Thus, the
required agreement must reflect the rele-
vant facts and circumstances, as known by
the taxpayer or as would be known by a
reasonably prudent person in the position
of the taxpayer, regarding both the amount
of the relevant royalty and the territory in
which the intellectual property is actually
used.
In general, a taxpayer cannot qual-
ify for the single-country exception
without satisfying the documentation
requirement in proposed §1.903-1(c)
(2)(iv)(D). Under proposed §1.903-1(c)
(2)(iv)(D), the required agreement pur-
suant to which the qualifying royalty is
paid must be executed no later than the
date on which the royalty is paid. How-
ever, recognizing that the single-country
exception is proposed to be applicable
to periods preceding the release of this
notice of proposed rulemaking, a special
transition documentation rule is provided
for royalties paid on or before May 17,
2023. In that case, to satisfy the doc-
umentation requirement, the required
agreement must be executed no later than
May 17, 2023 and the agreement must
state (whether in the terms of the agree-
ment or in recitals) that royalties paid on
or before the execution of the agreement
are considered paid pursuant to the terms
of the agreement.
The required agreement must be main-
tained by the taxpayer and provided to
the IRS within 30 days of a request by
the Commissioner or another period as
agreed between the Commissioner and
the taxpayer. Id. For purposes of the rule,
the term taxpayer includes a partnership
upon which foreign law imposes a tax.
See §1.901-2(f)(4) and (g)(7). Therefore,
if the royalty withholding tax is imposed
at the partnership level, the documentation
required by the proposed regulations must
be maintained by the partnership, even
though the party that claims the credit is
the partner and not the partnership. The
Treasury Department and the IRS request
comments as to whether special rules may
be necessary to address the documentation
requirement in the case of partnerships.
Finally, proposed §1.903-1(d)(3) and
(8) through (11) provide new examples
illustrating the application of the source-
based attribution rule and single-country
exception for covered withholding taxes
on royalties.
4. Separate levy
The proposed regulations also mod-
ify the separate levy rule in §1.901-2(d)
(1)(iii) for withholding taxes imposed on
nonresidents. Specifically, §1.901-2(d)
(1)(iii)(B)(3) provides that a withholding
tax that is imposed on a royalty payment
made to a nonresident pursuant to a sin-
gle-country license is treated as a sepa-
rate levy from a withholding tax that is
imposed on other royalty payments made
to such nonresident and from any other
withholding taxes imposed on other non-
residents. As with the special separate
levy rule for withholding taxes on differ-
ent classes of income or different subsets
of income within a class of income, this
rule may result in a foreign withholding
tax being considered a separate levy in
cases where the foreign tax law considers
only a single levy to be imposed. In con-
trast to a net income tax, this separate levy
rule can be applied to withholding taxes
because withholding taxes on royalties are
imposed on gross income and on a pay-
ment-by-payment basis. In addition, as
with the other special levy rules, this sep-
arate levy rule better aligns the outcomes
of the test with the purposes of the foreign
tax credit rules, including that of the attri-
bution requirement. The proposed reg-
ulations also reorder and reorganize the
paragraphs of proposed §1.901-2(d)(1)
(iii) to accommodate the addition of this
new provision, and to reflect the structure
of the rules more logically.
III. Applicability Dates
In general, except for proposed §1.861-
20(d)(3)(v)(E)(6), the proposed regula-
tions are proposed to apply to taxable
years ending on or after November 18,
2022. However, once the proposed regula-
tions are finalized, taxpayers may choose
to apply some or all of the final regula-
tions to earlier taxable years, subject to
certain conditions.
Proposed §1.861-20(d)(3)(v)(E)(6) is
proposed to apply to taxable years ending
on or after the date final regulations adopt-
ing these rules are filed with the Federal
Register. Taxpayers may choose to apply

Bulletin No. 2022–49 517 December 5, 2022
the rules of §1.861-20(d)(3)(v)(E)(6),
once finalized, to taxable years that begin
after December 31, 2019, and end before
the date final regulations adopting these
rules are filed with the Federal Register
provided they apply §1.861-20(d)(3)(v)
(E)(6) consistently to their first taxable
year beginning after December 31, 2019,
and any subsequent taxable year ending
before the date final regulations adopt-
ing these rules are filed with the Federal
Register.
Proposed §1.901-2(b)(4)(i) and (iv),
(b)(5)(i)(B)(2), and (d)(1)(iii) and pro-
posed §1.903-1(c)(2) and (d)(3), (4), and
(8) through (11) are proposed to apply
to foreign taxes paid in taxable years
ending on or after November 18, 2022.
Taxpayers may choose to apply the rules
of §1.901-2(b)(4)(i) and (iv), once final-
ized, for foreign taxes paid in taxable
years beginning on or after December
28, 2021, and ending before November
18, 2022, provided that they consistently
apply those rules to such taxable years.
Taxpayers may also choose to apply the
rules of §§1.901-2(b)(5)(i)(B)(2) and (d)
(1)(iii) and 1.903-1(c)(2) and (d)(3), (4),
and (8) through (11), once finalized, for
foreign taxes paid in taxable years begin-
ning on or after December 28, 2021, and
ending before November 18, 2022, pro-
vided that they consistently apply those
rules for such taxable years.
Finally, until the effective date of final
regulations, a taxpayer may rely on all or
part of the proposed regulations, subject
to certain conditions. Specifically, a tax-
payer may choose to rely on the provi-
sions addressing the reattribution asset
rule (proposed §1.861-20(d)(3)(v)(E)(6))
for taxable years that begin after Decem-
ber 31, 2019, and end before the effective
date of final regulations adopting these
rules. A taxpayer may also choose to
rely on the provisions addressing the cost
recovery requirement (proposed §1.901-
2(b)(4)(i) and (iv)) for foreign taxes paid
in taxable years beginning on or after
December 28, 2021, and ending before
the effective date of final regulations
adopting these rules. Finally, a taxpayer
may choose to rely on the provisions
addressing the attribution requirement
for royalty payments (proposed §1.901-
2(b)(5)(i)(B)(2) and (d)(1)(iii) and pro-
posed §1.903-1(c)(2) and (d)(3), (4), and
(8) through (11)) for foreign taxes paid
in taxable years beginning on or after
December 28, 2021, and ending before
the effective date of final regulations
adopting these rules.
If a taxpayer chooses to rely on any of
the three portions of the proposed regula-
tions described in the preceding paragraph,
the taxpayer and its related parties, within
the meaning of sections 267(b) (deter-
mined without regard to section 267(c)
(3)) and 707(b)(1), must consistently fol-
low all proposed regulations with respect
to that portion for all relevant years until
the effective date of the final regulations
adopting the rules.
Conforming Amendments to Other
Regulations and Guidance
The Treasury Department and the IRS
intend to make conforming amendments
to other regulations, including the cost
recovery rules that are not being revised in
these proposed regulations and the exam-
ples in §§1.901-2(b)(4)(iv) and 1.903-
1(d), upon finalization of the proposed
regulations.
Special Analyses
I. Regulatory Planning and Review
The Administrator of the Office of
Information and Regulatory Affairs
(“OIRA”), Office of Management and
Budget, has determined that this pro-
posed rule is not a significant regulatory
action, as that term is defined in section
3(f) of Executive Order 12866. There-
fore, OIRA has not reviewed this pro-
posed rule pursuant to section 6(a)(3)(A)
of Executive Order 12866 and the April
11, 2018, Memorandum of Agreement
between the Treasury Department and
the Office of Management and Budget
(“OMB”).
II. Paperwork Reduction Act
The Paperwork Reduction Act of 1995
(44 U.S.C. 3501-3520) (“PRA”) requires
that a federal agency obtain the approval
of the OMB before collecting information
from the public, whether such collection
of information is mandatory, voluntary, or
required to obtain or retain a benefit.
A. Overview
The collection of information in
these proposed regulations is in pro-
posed §1.903-1(c)(2)(iv)(D). As dis-
cussed in part II.C.3 of the Explanation
of Provisions, proposed §1.903-1(c)(2)
(iii)(B) provides an exception (the “sin-
gle-country exception”) to the source-
based attribution requirement if a tax-
payer can substantiate that the payment
on which the royalty withholding tax is
imposed was made pursuant to an agree-
ment that limits the right to use intangi-
ble property to the jurisdiction imposing
the tested foreign tax. Proposed §1.903-
1(c)(2)(iv)(A). The exception applies
only where the taxpayer has a written
license agreement that provides for the
payment of the royalty and that limits
the use of the intangible property giv-
ing rise to the royalty payment to the
territory of the foreign country impos-
ing the tax. A payment may also qualify
for the single-country exception if the
agreement separately states the portion
(whether as a specified amount or as a
formula) of the payment subject to the
tested foreign tax that is characterized
as a royalty and that is with respect to
the portion of the territory of the license
that is solely within the foreign country
imposing the tax. Proposed §1.903-1(c)
(2)(iv)(B).
Proposed §1.903-1(c)(2)(iv)(D)
requires taxpayers who claim eligibility
for the exception to provide an agreement
described in proposed §1.903-1(c)(2)(iv)
(A) or (B), as applicable, (the “required
agreement”) within 30 days of a request
by the Commissioner or another period
as agreed between the Commissioner
and the taxpayer. Proposed §1.903-1(c)
(2)(iv)(D) also provides a transition rule
in the case of a royalty paid on or before
May 17, 2023 that requires the required
agreement to be executed no later than
May 17, 2023.
B. Collection of information — Proposed
§1.903-1(c)(2)(iv)(D)
The Treasury Department and the IRS
intend that the information collection
requirement in proposed §1.903-1(c)(2)
(iv)(D) will be set forth in the forms and
instructions identified in Table 1.

December 5, 2022 518 Bulletin No. 2022–49
Table 1. Tax Forms Impacted
Collection of InformationNumber of respondents (estimated) Forms to which the information may be attached
Proposed §1.903-1(c)(2)(iv)(D)42,030
2
Form 1116 and Form 1118
Source: IRS’s Compliance Data Warehouse
The estimate for the number of
impacted filers with respect to the collec-
tion of information in proposed §1.903-
1(c)(2)(iv)(D) is based on the number of
U.S. corporations that filed a return that
had a Form 1118 that reported an amount
of withholding tax on rents, royalties, and
license fees on Schedule B, Part I, column
e; U.S. corporations that filed a return that
had a Form 1118 that reported an amount
of deemed paid taxes and a Form 5471
that reported an amount of gross royalties
and license fees on Schedule C (and thus
may have incurred a withholding tax on
those royalties); and U.S. individuals that
filed a return and had a Form 1116 that
reported an amount of withholding tax on
rents and royalties on Part II, column n.
3

This represents an upper bound of poten-
tially affected taxpayers: not all taxpayers
that have reported an amount of royalty
withholding tax paid to a foreign coun-
try or that have royalty income on which
they may have paid a withholding tax are
expected to claim a credit for such tax, and
not all taxpayers who claim such a credit
are expected to rely on the single country
exception in proposed §1.903-1(c)(2)(iii)
(B).
The Treasury Department and the IRS
expect that taxpayers subject to the collec-
tion of information in proposed §1.903-
1(c)(2)(iv)(D) will not have a significant
increase in burden (if any) because some
taxpayers may already have existing
license agreements that qualify for the
single-country exception in place for a
variety of tax and non-tax law reasons,
and other taxpayers may not elect to take
advantage of the single-country excep-
tion. The reporting burden associated
with this collection of information will
be reflected in future PRA submissions
associated with Form 1118 (OMB control
number 1545-0123), Form 1065 (OMB
control number 1545-0123), and Form
1116 (OMB control numbers 1545-0074
for individuals, and 1545-0121 for estates
and trusts). The collection of information
in proposed §1.903-1(c)(2)(iv)(D) will be
reflected in future Paperwork Reduction
Act submissions that the Treasury Depart-
ment and the IRS will submit to OMB
for these forms. The current status of the
Paperwork Reduction Act submissions
related to these forms is summarized in
Table 2.
Because the proposed regulations,
including the collection of information
in proposed §1.903-1(c)(2)(iv)(D), are
proposed to apply to taxes paid in taxable
years ending on or after the date the pro-
posed regulations are filed with the Fed-
eral Register, the Treasury Department
and the IRS have submitted the collection
of information in proposed §1.903-1(c)(2)
(iv)(D) to the OMB for review in accor-
dance with the Paperwork Reduction Act
and requested a new OMB control number
(the “temporary OMB control number”).
After the rulemaking is finalized, the
information collection contained within
the regulations will be incorporated into
the OMB control numbers described in
Table 2.
Table 2. Status of Current Paperwork Reduction Submissions.
Form
Type of FilerTemporary OMB
Control Number
Incorporated into OMB Control
Number(s) after Final Rulemaking
Form 1116Trusts & estates1545-NEW1545-0121
Individual 1545-NEW1545-0074
Form 1118Business 1545-NEW1545-0123
Commenters are strongly encouraged
to submit public comments electronically.
Comments and recommendations for the
proposed information collection should
be sent to https://www.reginfo.gov/pub-
lic/do/PRAMain, with electronic copies
emailed to the IRS at pra.comments@
irs.gov (indicate REG-112096-22 on the
subject line). This particular informa-
tion collection can be found by selecting
“Currently under Review - Open for Pub-
lic Comments” then by using the search
function. Comments can also be mailed to
OMB, Attn: Desk Officer for the Depart-
ment of the Treasury, Office of Informa-
tion and Regulatory Affairs, Washington,
DC 20503, with copies mailed to the IRS,
Attn: IRS Reports Clearance Officer,
SE:W:CAR:MP:T:T:SP, Washington, DC
20224. Comments on the collections of
information should be received by Janu-
ary 23, 2023.
The likely respondents associated with
the temporary OMB control number are
2
The estimated number of respondents in this Table 1 is based on the number of respondents from the 2020 tax year.
3
As explained in part II.C.3 of the Explanation of Provisions, the collection of information in proposed §1.903-1(c)(2)(iv)(D) also impacts partnerships and S corporations that pay a with-
holding tax that is imposed at the partnership or S corporation level under foreign law even though it is the partners or S corporation shareholder that claims the credit for those taxes. The
Treasury Department and the IRS lack sufficient data to identify the number of partnerships and S corporations that pay foreign withholding taxes on royalty income. However, the IRS and
Treasury Department do not expect that this will impact the number of affected taxpayers since the partners and shareholders that claim a credit for the royalty withholding tax would be
captured within the Form 1116 and Form 1118 filers.

Bulletin No. 2022–49 519 December 5, 2022
U.S. persons who pay or accrue foreign
withholding taxes on royalty income.
Estimated total annual reporting bur-
den: 420,300 hours
Estimated average annual burden per
respondent: 10 hours
Estimated number of respondents:
42,030
Estimated frequency of responses:
Annually.
The Treasury Department and the IRS
expect to add the burden for this tempo-
rary OMB control number to OMB con-
trol numbers 1545-0123, 1545-0074, and
1545-0121 after the final rulemaking. For
1545-0123 and 1545-0074, the Treasury
Department and the IRS estimate burdens
on a taxpayer-type basis rather than a pro-
vision-specific basis.
III. Regulatory Flexibility Act
Pursuant to the Regulatory Flexibility
Act (5 U.S.C. chapter 6), it is hereby certi-
fied that the proposed regulations will not
have a significant economic impact on a
substantial number of small entities within
the meaning of section 601(6) of the Reg-
ulatory Flexibility Act.
The proposed regulations provide guid-
ance affecting individuals and corporations
claiming foreign tax credits. The domestic
small business entities that are subject to the
foreign tax credit rules in the Code and in
the proposed regulations are generally those
that operate in a foreign country or that have
income from sources outside of the United
States and pay foreign taxes. The reattribu-
tion asset definition in proposed §1.861-
20(d)(3)(v)(E)(6) applies only to taxable
units that make or receive disregarded
payments that are considered reattribution
payments which result in the reattribution
of assets from one taxable unit to another.
§1.861-20(d)(3)(v)(C)(1)(ii). In addition,
some provisions of these proposed regu-
lations, such as proposed §1.903-1, apply
only to entities that license intellectual
property for use in a foreign country and
receive royalty payments that are subject
to foreign withholding tax. The Treasury
Department and the IRS do not expect that
the proposed regulations will likely affect
a substantial number of domestic small
business entities because it is infrequent for
domestic small entities to engage in signif-
icant foreign operations or in the types of
transactions giving rise to the foreign taxes
addressed by these proposed regulations.
However, the Treasury Department and the
IRS do not have adequate data readily avail-
able to assess the number of small entities
potentially affected by the final regulations.
The Treasury Department and the IRS
have determined that the proposed regula-
tions will not have a significant economic
impact on domestic small business entities.
To provide an upper bound estimate of the
impact these final regulations could have on
business entities, the Treasury Department
and the IRS calculated, based on e-file data
for the 2020 tax year, foreign tax credits as
a percentage of four different tax-related
measures of annual receipts (see Table 3 for
variables) by corporations. As demonstrated
by the data in Table 3 below, foreign tax
credits as a percentage of all four measures
of annual receipts are substantially less than
the three to five percent threshold for signif-
icant economic impact for corporations with
business receipts less than $250 million.
Table 3. FTCs as Percentage of Annual Receipts
Size (by Business Receipts)Under
$500k
$500k
to $1M
$1M to
$5M
$5M to
$10M
$10M to
$50M
$50M to
$100M
$100M to
$250M
$250M
or more
FTC/Gross Receipts0.00%0.00%0.00%0.01%0.01%0.02%0.03%0.05%
FTC/Business Receipts0.00%0.00%0.00%0.00%0.01%0.02%0.03%0.05%
FTC/Total Income0.00%0.00%0.00%0.01%0.02%0.04%0.07%0.57%
FTC/(Total Income-Total Deductions) –0.02%0.03%0.05%0.11%0.16%0.41%0.72%3.33%
Source: RAAS:KDA (Tax Year 2020 CDW E-File Data 9-26-22)
Note: Business Receipts = Total Income + Cost of Goods Sold
The Treasury Department and the
IRS anticipate that only a small fraction
of existing foreign tax credits would be
impacted by these regulations, and thus,
the economic impact of these regula-
tions will be considerably smaller than
the effects shown in Table 3. A portion of
economic impact of these proposed regu-
lations derive from the collection of infor-
mation requirement in proposed §1.903-
1(c)(2)(iv)(D). The Treasury Department
and the IRS do not have readily available
data to determine the incremental burden
that this collection of information will
have on small business entities. How-
ever, the Treasury Department and the
IRS believe this collection of information
will only marginally increase taxpayers’
burdens because some taxpayers may
already have existing license agreements
that qualify for the single-country excep-
tion for a variety of tax and non-tax law
reasons, and other taxpayers may not elect
to take advantage of the single-country
exception. Furthermore, as demonstrated
in Table 3 in this Part III of the Special
Analyses, foreign tax credits do not have
a significant economic impact for any
gross-receipts class of business enti-
ties. Therefore, proposed §1.903-1(c)(2)
(iv)(D) will not have a significant eco-
nomic impact on small business entities.
Accordingly, it is hereby certified that the
proposed regulations will not have a sig-
nificant economic impact on a substantial
number of small entities.
IV. Section 7805(f)
Pursuant to section 7805(f), these pro-
posed regulations will be submitted to the
Chief Counsel for Advocacy of the Small
Business Administration for comment
on its impact on small businesses. The
Treasury Department and the IRS also
request comments from the public on the
certifications in this Part III of the Special
Analyses.

December 5, 2022 520 Bulletin No. 2022–49
V. Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates
Reform Act of 1995 (UMRA) requires that
agencies assess anticipated costs and ben-
efits and take certain other actions before
issuing a final rule that includes any Fed-
eral mandate that may result in expendi-
tures in any one year by a state, local, or
tribal government, in the aggregate, or by
the private sector, of $100 million in 1995
dollars, updated annually for inflation.
This proposed rule does not include any
Federal mandate that may result in expen-
ditures by state, local, or tribal govern-
ments, or by the private sector in excess of
that threshold.
VI. Executive Order 13132: Federalism
Executive Order 13132 (entitled
“Federalism”) prohibits an agency from
publishing any rule that has federalism
implications if the rule either imposes
substantial, direct compliance costs on
State and local governments, and is not
required by statute, or preempts State law,
unless the agency meets the consultation
and funding requirements of section 6 of
the Executive order. This proposed rule
does not have federalism implications and
does not impose substantial direct compli-
ance costs on state and local governments
or preempt State law within the meaning
of the Executive order.
Comments and Request for Public
Hearing
Before these proposed regulations are
adopted as final regulations, consideration
will be given to any comments that are
submitted timely to the IRS as prescribed
in this preamble under the ADDRESSES
heading. The Treasury Department and
the IRS request comments on all aspects
of the proposed rules, and specifically on
the issues identified in Parts I.B and II.C.3
of the Explanation of Provisions. All com-
ments will be available at www.regula-
tions.gov or upon request.
A public hearing will be scheduled
if requested in writing by any person
that timely submits written comments.
Requests for a public hearing are encour-
aged to be made electronically. If a pub-
lic hearing is scheduled, notice of the
date and time for the public hearing will
be published in the Federal Register.
Announcement 2020-4, 2020-17 IRB 1,
provides that until further notice, public
hearings conducted by the IRS will be
held telephonically. Any telephonic hear-
ing will be made accessible to people with
disabilities.
Drafting Information
The principal authors of the proposed
regulations are Jeffrey L. Parry, Teisha M.
Ruggiero, and Suzanne M. Walsh of the
Office of Associate Chief Counsel (Inter-
national). However, other personnel from
the Treasury Department and the IRS par-
ticipated in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and record-
keeping requirements.
Proposed Amendments to the
Regulations
Accordingly, the Treasury Department
and IRS propose to amend 26 CFR part 1
as follows:
PART 1—INCOME TAXES
Paragraph 1. The authority citation for
part 1 continues to read in part as follows:
Authority: 26 U.S.C. 7805 * * *
Par. 2. Section 1.861-20 is amended by
revising paragraphs (d)(3)(v)(E)(6) and (i)
to read as follows:
§1.861-20 Allocation and
apportionment of foreign income taxes.
* * * * *
(d) * * *
(3) * * *
(v) * * *
(E) * * *
(6) Reattribution asset. The term reat-
tribution asset means an asset that pro-
duces one or more items of gross income,
computed under Federal income tax law,
to which a disregarded payment, other
than a disregarded payment received in
exchange for property, is allocated under
the rules of paragraph (d)(3)(v)(B)(2) of
this section.
* * * * *
(i) Applicability dates. (1) Except as
provided in paragraphs (i)(2) through (4)
of this section, this section applies to tax-
able years beginning after December 31,
2019.
(2) Paragraphs (b)(19) and (23) and (d)
(3)(i), (ii), and (v) of this section apply to
taxable years that begin after December
31, 2019, and end on or after November
2, 2020.
(3) Paragraph (d)(3)(v)(E)(6) of this
section applies to taxable years that end
on or after [date the final rule is filed with
the Federal Register]. Taxpayers may
choose to apply the rules in paragraph
(d)(3)(v)(E)(6) of this section to tax-
able years beginning after December 31,
2019, and ending before [date the final
rule is filed with the Federal Register],
provided they apply paragraph (d)(3)(v)
(E)(6) of this section consistently to their
first taxable year beginning after Decem-
ber 31, 2019, and any subsequent taxable
year beginning before [date the final rule
is filed with the Federal Register]. Oth-
erwise, for taxable years beginning after
December 31, 2019, and ending before
[date the final rule is filed with the Fed-
eral Register], see §1.861-20(d)(3)(v)(E)
(6) as contained in 26 CFR part 1 revised
as of July 27, 2022.
(4) Paragraph (h) of this section applies
to taxable years beginning after December
28, 2021.
Par 3. Section 1.901-2 is amended:
1. By revising paragraph (b)(4)(i)(A).
2. By redesignating paragraphs (b)(4)(i)
(B), (b)(4)(i)(C)(3), and (b)(4)(i)(D)
as paragraph (b)(4)(i)(G), (b)(4)(i)
(D), and (b)(4)(i)(E), respectively.
3. By adding new paragraph (b)(4)(i)
(B).
4. By revising paragraph (b)(4)(i)(C).
5. By revising the first sentence of newly
redesignated paragraph (b)(4)(i)(D).
6. By adding paragraph (b)(4)(i)(F).
7. In newly redesignated paragraph (b)
(4)(i)(G)(1), by removing the lan-
guage “one or more significant costs
and expenses” and adding the lan-
guage “substantially all of each item
of significant cost or expense” in its
place.
8. In paragraph (b)(4)(iv)(A)(2), by
removing the language “significant
costs and expenses” and adding the

Bulletin No. 2022–49 521 December 5, 2022
language “substantially all of each
item of significant cost or expense” in
its place.
9. In paragraph (b)(4)(iv)(B)(2), by
removing the language “(b)(4)(i)(B)
(2)” and adding the language “(b)(4)
(i)(G)(2)” in its place.
10. By removing and reserving paragraph
(b)(4)(iv)(C).
11. In paragraphs (b)(4)(iv)(D)(2) and
(b)(4)(iv)(E)(2), by removing the lan-
guage “(b)(4)(i)(C)(2)” and adding
the language “(b)(4)(i)(F)(2)” in its
place.
12. By adding paragraphs (b)(4)(iv)(F)
through (J).
13. By revising paragraphs (b)(5)(i)(B)
(2), (d)(1)(iii), and (h).
The revisions and additions read as
follows:
§ 1.901-2 Income, war profits, or excess
profits tax paid or accrued.
* * * * *
(b) * * *
(4) * * *
(i) * * *
(A) In general. A foreign tax satisfies
the cost recovery requirement if the base
of the tax is computed by reducing gross
receipts (as described in paragraph (b)
(3) of this section) to permit recovery of
substantially all of each item of significant
cost or expense (including each item of
cost or expense related to the categories
described in paragraph (b)(4)(i)(B)(2) of
this section) attributable, under reasonable
principles, to such gross receipts. See para-
graph (b)(4)(i)(B) of this section for rules
regarding the determination of what is a
significant cost or expense, paragraph (b)
(4)(i)(C) of this section for rules regard-
ing the recovery of substantially all of an
item, paragraph (b)(4)(i)(E) of this section
for rules regarding principles for attribut-
ing costs and expenses to gross receipts,
and paragraph (b)(4)(i)(F) of this section
for exceptions to this rule. A foreign tax
need not permit recovery of significant
costs and expenses, such as certain per-
sonal expenses, that are not attributable,
under reasonable principles, to gross
receipts included in the foreign tax base.
A foreign tax whose base is gross receipts,
with no reduction for costs and expenses,
satisfies the cost recovery requirement
only if there are no significant costs and
expenses described in paragraph (b)(4)(i)
(B) of this section attributable to the gross
receipts included in the foreign tax base.
See paragraph (b)(4)(iv)(A) of this section
(Example 1). A foreign tax that provides
an alternative cost allowance satisfies the
cost recovery requirement only as pro-
vided in paragraph (b)(4)(i)(G) of this
section.
(B) Significant costs and expenses—
(1) In general. Except as provided in
paragraph (b)(4)(i)(B)(2) of this section,
whether an item of cost or expense is sig-
nificant for purposes of this paragraph (b)
(4)(i) is determined based on whether, for
all taxpayers in the aggregate to which
the foreign tax applies, the item of cost or
expense constitutes a significant portion
of the taxpayers’ total costs and expenses.
(2) Per se significant costs and
expenses. An item of cost or expense (as
characterized under foreign law) related
to capital expenditures, interest, rents,
royalties, wages or other payments for ser-
vices, and research and experimentation is
always treated as an item of significant
cost or expense for purposes of this para-
graph (b)(4)(i).
(C) Recovery of substantially all of
each item—(1) In general. Whether a
foreign tax permits recovery of substan-
tially all of each item of significant cost or
expense is determined based solely on the
terms of the foreign tax law.
(2) Safe harbor. One or more disal-
lowances of a stated portion of an item
(or multiple items) of significant cost or
expense does not prevent a foreign tax
from being considered to permit recovery
of substantially all of each item of signif-
icant cost or expense if the total portion
of the item (or items) that is disallowed
does not exceed 25 percent. A limitation
that caps the recovery of an item of sig-
nificant cost or expense, or multiple items
of cost or expense that relate to a single
category of significant costs and expenses
described in paragraph (b)(4)(i)(B)(2) of
this section does not prevent a foreign tax
from being considered to permit recovery
of substantially all of each item of signif-
icant cost or expense if the limitation is a
qualifying cap. For such purpose, a lim-
itation that caps the recovery at a stated
portion of gross receipts, gross income,
or a similar measure is a qualifying cap if
the stated portion of such measure is not
less than 15 percent. A limitation that caps
the recovery at a stated portion of taxable
income (determined without regard to the
item at issue) or a similar measure is a
qualifying cap if the stated portion of such
measure is not less than 30 percent.
(3) Non-recovery of significant costs
and expenses. Significant costs and
expenses (such as interest expense) are
not considered to be recovered by reason
of the time value of money attributable to
the acceleration of a tax benefit or eco-
nomic benefit attributable to the timing of
the recovery of other costs and expenses
(such as the current expensing of debt-fi-
nanced capital expenditures).
(D) * * * A foreign tax law permits
recovery of substantially all of each item
of significant cost or expense even if such
item of cost or expense is recovered ear-
lier or later than it is recovered under the
Internal Revenue Code unless the time of
recovery is so much later as effectively to
constitute a denial of such recovery. * * *
* * * * *
(F) Exceptions—(1) Disallowances
consistent with U.S. principles. Notwith-
standing paragraph (b)(4)(i)(A) of this
section, a disallowance of all or a portion
of an item of significant cost or expense
does not prevent a foreign tax from sat-
isfying the cost recovery requirement if
such disallowance is consistent with any
principle underlying the disallowances
required under the income tax provisions
of the Internal Revenue Code, including
the principles of limiting base erosion
or profit shifting and addressing non-tax
public policy concerns similar to those
reflected in the Internal Revenue Code.
For example, a foreign tax may satisfy
the cost recovery requirement even if
the foreign tax law disallows deductions
in connection with hybrid transactions,
disallows deductions attributable to
gross receipts that in whole or in part are
excluded, exempt or eliminated from tax-
able income, or disallows certain deduc-
tions consistent with non-tax public policy
considerations similar to those underlying
the disallowances contained in section
162. See paragraphs (b)(4)(iv)(I) and (J)
of this section (Examples 9 and 10).
(2) Amounts that need not be recov-
ered. A foreign tax law may satisfy the
cost recovery requirement even if the

December 5, 2022 522 Bulletin No. 2022–49
foreign tax law does not permit recov-
ery of costs and expenses attributable to
wage income or to investment income
that is not derived from a trade or busi-
ness. In addition, in determining whether
a foreign tax (the “tested foreign tax”)
meets the cost recovery requirement, it is
immaterial whether the tested foreign tax
allows a deduction for other taxes that
would qualify as foreign income taxes
(determined without regard to whether
such other tax allows a deduction for the
tested foreign tax). See paragraphs (b)(4)
(iv)(D) and (E) of this section (Examples
4 and 5).
* * * * *
(iv) * * *
(F) Example 6: Substantially all; application of
the safe harbor—(1) Facts. Country X imposes a tax
(“Country X tax”) on the income of corporations that
are resident in Country X. Under Country X tax law,
full deductions are allowed for each item of signif-
icant cost or expense attributable under reasonable
principles to the gross receipts included in the Coun-
try X tax base, except that Country X tax law disal-
lows a deduction for 25 percent of a taxpayer’s costs
and expenses for royalties related to patents.
(2) Analysis. Under paragraph (b)(4)(i)(B)(2)
of this section, an item of cost or expense related
to royalties is always treated as a significant cost
or expense, and therefore, under paragraph (b)(4)
(i)(A) of this section, absent an exception, Country
X tax law must permit recovery of substantially all
of each item of cost or expense related to royalties,
including the item of royalties related to patents. The
stated percentage of costs and expenses from royal-
ties related to patents (25 percent) that is disallowed
under Country X tax law does not exceed 25 percent.
Accordingly, under the safe harbor in paragraph (b)
(4)(i)(C)(2) of this section, the disallowance does
not prevent the Country X tax from being considered
to permit recovery of substantially all of each item
of cost or expense related to royalties, and there-
fore the Country X tax satisfies the cost recovery
requirement.
(G) Example 7: Substantially all; application of
the safe harbor—(1) Facts. Country X imposes a tax
(“Country X tax”) on the income of corporations that
are resident in Country X. Under Country X tax law,
full deductions are allowed for each item of signif-
icant cost or expense attributable under reasonable
principles to the gross receipts included in the Coun-
try X tax base, except that Country X tax law disal-
lows a deduction for 15 percent of a taxpayer’s costs
and expenses for rents and 25 percent of a taxpayer’s
costs and expenses for interest.
(2) Analysis. Under paragraph (b)(4)(i)(B)(2)
of this section, an item of cost or expense related to
rents or interest is always treated as a significant cost
or expense, and therefore, under paragraph (b)(4)
(i)(A) of this section, absent an exception, Country
X tax law must permit recovery of substantially all
of each item of cost or expense related to royalties
and interest. The stated percentage of the costs and
expenses related to rents (15 percent) that is disal-
lowed under Country X tax law does not exceed 25
percent. Additionally, the stated percentage of the
costs and expenses related to interest (25 percent)
that is disallowed under Country X law does not
exceed 25 percent. Accordingly, under the safe har-
bor in paragraph (b)(4)(i)(C)(2) of this section, the
disallowances do not prevent the Country X tax from
being considered to permit recovery of substantially
all of each item of cost or expense related to rents
and interest, and therefore the Country X tax satisfies
the cost recovery requirement.
(H) Example 8: Substantially all; application of
the safe harbor—(1) Facts. Country X imposes a tax
(“Country X tax”) on the income of corporations that
are resident in Country X. Under Country X tax law,
full deductions are allowed for each item of signif-
icant cost or expense attributable under reasonable
principles to the gross receipts included in the Coun-
try X tax base, except that Country X tax law caps
the recovery of the deduction of interest at 30 percent
of the taxpayer’s taxable income determined without
regard to interest expense.
(2) Analysis. Under paragraph (b)(4)(i)(B)(2)
of this section, an item of cost or expense related
to interest is always treated as a significant cost or
expense, and therefore, under paragraph (b)(4)(i)(A)
of this section, absent an exception, Country X tax
law must permit recovery of substantially all of each
item of cost or expense related to interest. The stated
cap on recovery in Country X tax law with respect
to interest (30 percent of taxable income determined
without regard to interest expense) is not less than 30
percent of taxable income determined without regard
to interest expense. Additionally, the cap on recov-
ery relates to a single category of significant costs
and expenses described in paragraph (b)(4)(i)(B)(2)
of this section. Accordingly, under the safe harbor
in paragraph (b)(4)(i)(C)(2) of this section, the dis-
allowance does not prevent the Country X tax from
being considered to permit recovery of substantially
all of each item of cost or expense related to inter-
est, and therefore the Country X tax satisfies the cost
recovery requirement.
(I) Example 9: Permissible disallowance based
on U.S. principles—(1) Facts. Country X imposes
a tax on the income of corporations that are resi-
dent in Country X. Under Country X tax law, full
deductions are allowed for each item of significant
cost or expense attributable under reasonable princi-
ples to the gross receipts included in the Country X
tax base, except that under Country X’s anti-hybrid
rules, a deduction is disallowed for any payment,
including interest, royalties, rents, or payments for
services, made by a Country X resident to a related
entity located outside of Country X if the payment
is not included in gross income by the payee or the
payee is not subject to tax.
(2) Analysis. Under paragraph (b)(4)(i)(B)(2) of
this section, each item of cost or expense related to
interest, rents, royalties, and payments for services
is always treated as a significant cost or expense,
and therefore, under paragraph (b)(4)(i)(A) of this
section, absent an exception, Country X tax law
must permit recovery of substantially all of each
item of cost or expense related to interest, rents,
royalties, and payments for services. Country X tax
law does not permit recovery of any portion of any
item of significant cost or expense that is subject
to the anti-hybrid rules. As a result, the safe harbor
in paragraph (b)(4)(i)(C)(2) of this section does not
apply to such item. Further, because a deduction
is disallowed for any item of cost or expense that
is subject to the Country X anti-hybrid rules, the
Country X tax law completely disallows certain
items of cost and expense related to interest, rents,
royalties, and payments for services and thus does
not permit recovery of substantially all of each item
of significant cost or expense related to interest,
rents, royalties, and payments for services. How-
ever, under paragraph (b)(4)(i)(F)(1) of this section,
a disallowance of all or a portion of an item of sig-
nificant cost or expense does not prevent a foreign
tax from satisfying the cost recovery requirement
if the disallowance is consistent with any princi-
ple underlying the disallowances required under
the income tax provisions of the Internal Revenue
Code. The income tax provisions of the Internal
Revenue Code, specifically section 267A, contain
disallowances of deductions based on the principle
of limiting base erosion or profit shifting. Country
X’s disallowance of deductions for any payment,
including interest, royalties, rents, or payments for
services also reflects the principle of limiting base
erosion or profit shifting. Accordingly, because
Country X’s anti-hybrid rules are consistent with
the principle of limiting base erosion or profit shift-
ing, the Country X tax satisfies the cost recovery
requirement.
(J) Example 10: Permissible disallowance based
on U.S. principles—(1) Facts. Country X imposes a
tax on the income of corporations that are resident
in Country X. Under Country X tax law, full deduc-
tions are allowed for each item of significant cost or
expense attributable to the gross receipts included in
the Country X tax base, except that no deduction is
permitted for any stock-based payments for services.
(2) Analysis. Under paragraph (b)(4)(i)(B)(2)
of this section, each item of cost or expense related
to wages or other payments for services is always
treated as a significant cost or expense, and there-
fore, under paragraph (b)(4)(i)(A) of this section,
absent an exception, Country X tax law must per-
mit recovery of substantially all of each item of cost
or expense related to wages or other payments for
services. Country X tax law denies a deduction for
any stock-based payments for services, and there-
fore the safe harbor in paragraph (b)(4)(i)(C)(2) of
this section is not satisfied. Further, given that no
deduction is allowed for stock-based payments for
services, the Country X tax law completely disal-
lows an item of cost or expense related to wages or
other payments for services and thus does not permit
recovery of substantially all of each item of signifi-
cant cost or expense related to wages or other pay-
ments for services. However, under paragraph (b)
(4)(i)(F)(1) of this section, a disallowance of all or
a portion of an item of significant cost or expense
does not prevent a foreign tax from satisfying the
cost recovery requirement if such disallowance is
consistent with any principle underlying the disal-
lowances required under the income tax provisions
of the Internal Revenue Code. The income tax provi-
sions of the Internal Revenue Code contain targeted
disallowances or limits on the deductibility of certain
items of compensation in particular circumstances

Bulletin No. 2022–49 523 December 5, 2022
based on non-tax public policy reasons, including
to influence the amount or use of a certain type of
compensation in the labor market. For example,
section 162(m) imposes limits on deductions for
compensation of certain highly-paid employees,
and section 280G limits the deductibility of certain
“parachute payments” provided to individuals when
an entity undergoes a change of control. Country X’s
targeted disallowance of deductions for the portion
of payments for services attributable to stock-based
compensation also reflects a principle of influencing
the amount or use of a certain type of compensation
(stock-based compensation) in the labor market.
Accordingly, because the Country X tax law’s disal-
lowance is consistent with a principle underlying the
disallowances required under the income tax provi-
sions of the Internal Revenue Code, the Country X
tax satisfies the cost recovery requirement.
(5) * * *
(i) * * *
(B) * * *
(2) Royalties. Under the foreign tax
law, gross income from royalties must be
sourced based on the place of use of, or
the right to use, the intangible property,
as determined under reasonable princi-
ples (which do not include determining
the place of use of, or the right to use, the
intangible property based on the location
of the payor).
* * * * *
(d) * * *
(1) * * *
(iii) Tax imposed on nonresidents—(A)
In general. A foreign levy imposed on
nonresidents is always treated as a sepa-
rate levy from that imposed on residents,
even if the base of the tax as applied to
residents and nonresidents is the same,
and even if the levies are treated as a sin-
gle levy under foreign tax law.
(B) Withholding tax—(1) In general.
Except as otherwise provided in this para-
graph (d)(1)(iii)(B), a withholding tax
(as defined in section 901(k)(1)(B)) that
is imposed on a payment giving rise to
gross income of nonresidents is treated as
a separate levy as to each separate class of
income described in section 61 (for exam-
ple, interest, dividends, rents, or royalties)
subject to the withholding tax.
(2) Subsets of income. If two or more
subsets of a separate class of income are
subject to a withholding tax based on dif-
ferent income attribution rules (for exam-
ple, if technical services are subject to tax
based on the residence of the payor and
other services are subject to tax based on
where the services are performed), sepa-
rate levies are considered to be imposed
with respect to each subset of that separate
class of income.
(3) Royalty income. A withholding tax
that is imposed on a payment giving rise
to gross royalty income of a nonresident
that is made pursuant to a single-country
license (as determined under §1.903-1(c)
(2)(iv)) is treated as a separate levy from
a withholding tax that is imposed on other
gross royalty income of such nonresident
and is also treated as a separate levy from
any withholding tax imposed on other
nonresidents.
* * * * *
(h) Applicability dates—(1) In general.
Except as provided in paragraphs (h)(2)
and (3) of this section, this section applies
to foreign taxes paid (within the meaning
of paragraph (g) of this section) in taxable
years beginning on or after December 28,
2021. For foreign taxes that relate to (and
if creditable are considered to accrue in)
taxable years beginning before December
28, 2021, and that are remitted in taxable
years beginning on or after December 28,
2021, by a taxpayer that accounts for for-
eign income taxes on the accrual basis, see
§1.901-2 as contained in 26 CFR part 1
revised as of April 1, 2021.
(2) Certain foreign taxes paid to
Puerto Rico. For foreign taxes paid to
Puerto Rico by reason of section 1035.05
of the Puerto Rico Internal Revenue Code
of 2011, as amended (13 L.P.R.A. 30155)
(treating certain income, gain or loss as
effectively connected with the active con-
duct of a trade or business with Puerto
Rico), this section applies to foreign taxes
paid (within the meaning of paragraph (g)
of this section) in taxable years beginning
on or after January 1, 2023. For foreign
taxes described in the preceding sentence
that are paid in taxable years beginning
before January 1, 2023, see §1.901-2 as
contained in 26 CFR part 1 revised as of
April 1, 2021.
(3) Modifications to cost recovery and
royalty attribution rules. Paragraphs (b)
(4)(i) and (iv), (b)(5)(i)(B)(2), and (d)
(1)(iii) of this section apply to foreign
taxes paid (within the meaning of para-
graph (g) of this section) in taxable years
ending on or after November 18, 2022.
For foreign taxes described in the pre-
ceding sentence that are paid in taxable
years ending before November 18, 2022,
see §1.901-2(b)(4)(i) and (iv), (b)(5)(i)
(B)(2), and (d)(1)(iii) as contained in 26
CFR part 1 revised as of July 27, 2022.
Taxpayers may choose to apply the rules
in paragraphs (b)(4)(i) and (iv) of this
section to foreign taxes paid in taxable
years beginning on or after December
28, 2021, and ending before November
18, 2022 provided that they consistently
apply those rules to such taxable years.
Additionally, taxpayers may choose to
apply the rules of paragraphs (b)(5)(i)
(B)(2) and (d)(1)(iii) of this section to
foreign taxes paid in taxable years begin-
ning on or after December 28, 2021, and
ending before November 18, 2022, pro-
vided that they consistently apply those
rules and the rules of §1.903-1(c)(2) and
(d)(3), (4), and (8) through (11) to such
taxable years.
* * * * *
Par 4. Section 1.903-1 is amended:
1. By revising paragraphs (c)(2) intro-
ductory text and (c)(2)(iii).
2. By adding paragraph (c)(2)(iv).
3. By revising paragraph (d)(3).
4. By removing and reserving paragraph
(d)(4).
5. By adding paragraphs (d)(8) through
(11).
6. By revising paragraph (e).
The revisions and additions read as
follows:
§ 1.903-1 Taxes in lieu of income taxes.
* * * * *
(c) * * *
(2) Covered withholding tax. A tested
foreign tax is a covered withholding tax
if, based on the foreign tax law (except
as provided in paragraph (c)(2)(iii)(B) of
this section), the requirements in para-
graphs (c)(1)(i) and (c)(2)(i) through (iii)
of this section are met with respect to the
tested foreign tax. See also §1.901-2(d)(1)
(iii) for rules treating withholding taxes as
separate levies with respect to each class
of income subject to the tax, with respect
to each subset of a class of income that
is subject to different income attribution
rules, or with respect to withholding tax
that is imposed on a payment giving rise
to gross royalty income of a nonresident
that is made pursuant to a single-country
license (as determined under paragraph
(c)(2)(iv) of this section).
* * * * *

December 5, 2022 524 Bulletin No. 2022–49
(iii) Source-based attribution require-
ment. The income subject to the tested for-
eign tax satisfies the requirements in para-
graph (c)(2)(iii)(A) or (B) of this section.
(A) The income subject to the tested
foreign tax satisfies the attribution require-
ment described in §1.901-2(b)(5)(i)(B).
(B) The income subject to the tested
foreign tax is characterized as royalty
income and the payment giving rise to
such income is made pursuant to a sin-
gle-country license as determined under
paragraph (c)(2)(iv) of this section. For
purposes of this paragraph (c)(2)(iii)(B)
and paragraph (c)(2)(iv) of this section,
whether the income is characterized as
royalty income is determined under the
foreign tax law, except that income from
the sale of a copyrighted article (as deter-
mined under rules similar to §1.861-18)
is not characterized as royalty income
regardless of the characterization of the
income under the foreign tax law.
(iv) Single-country license—(A) In
general. Except as otherwise provided
in this paragraph (c)(2)(iv), for purposes
of paragraph (c)(2)(iii)(B) of this sec-
tion, a payment is made pursuant to a
single-country license if the terms of the
license agreement pursuant to which the
payment is made characterize the payment
as a royalty and limit the territory of the
license to the foreign country imposing
the tested foreign tax.
(B) Separately stated portions. If a
written agreement that is not described
in paragraph (c)(2)(iv)(A) of this section
separately states a portion (whether as a
specified amount or as a formula) of the
payment subject to the tested foreign tax
and such portion is both characterized as
a royalty under the terms of the agreement
and is attributable to the part of the ter-
ritory of the license that is solely within
the foreign country imposing the tested
foreign tax, then that portion of the pay-
ment is treated as made pursuant to a sin-
gle-country license.
(C) Validity of agreement. A payment
is considered not made pursuant to a sin-
gle-country license if the taxpayer knows,
or has reason to know, that the terms of the
agreement pursuant to which the payment
is made misstate the territory in which
the relevant intangible property is used or
overstate the amount of the royalty with
respect to the part of the territory of the
license that is solely within the foreign
country imposing the tested foreign tax. A
taxpayer is considered to have reason to
know if its knowledge of relevant of facts
or circumstances is such that a reasonably
prudent person in the position of the tax-
payer would question whether the terms
of the agreement misstate the territory in
which the relevant intangible property is
used or overstate the amount of a royalty.
For purposes of this section, the principles
of sections 482 and 861 apply to deter-
mine whether the terms of the agreement
misstate the territory in which the relevant
intangible property is used or overstate the
amount of a royalty. See paragraph (d)(11)
of this section (Example 11).
(D) Documentation. A taxpayer must
provide the agreement described in para-
graph (c)(2)(iv)(A) or (B) of this section,
as applicable (the “required agreement”),
within 30 days of a request by the Com-
missioner or another period as agreed
between the Commissioner and the tax-
payer. Except as provided in the next
sentence, the required agreement pursu-
ant to which the royalty is paid must be
executed no later than the date of payment
that gives rise to the gross royalty income
that is subject to the tested foreign tax. In
the case of a royalty that is paid before
the date on which the required agreement
is executed, in order to meet the require-
ment of this paragraph (c)(2)(iv)(D), the
required agreement must be executed no
later than May 17, 2023, and the agree-
ment must state that royalties paid on or
before the date of execution of the agree-
ment are, for purposes of this paragraph
(c)(2)(iv), considered paid pursuant to the
terms of the agreement.
(d) * * *
(3) Example 3: Withholding tax on royalties;
attribution requirement—(i) Facts. YCo, a resident
of Country Y, is a controlled foreign corporation
wholly owned by USP, a domestic corporation. In
Year 1, YCo enters into a written license agreement
(the “Agreement”) with XCo, a resident of Country
X unrelated to YCo or USP, for the right to use YCo’s
intangible property (“IP”) in a territory defined by
the Agreement as the entire world, including Country
X, in exchange for payments that the terms of the
Agreement characterize as royalties. The payments
made by XCo to YCo under the Agreement are also
characterized as royalties under the laws of Coun-
try X. Under Country X’s tax law, all gross royalty
payments made by a Country X resident to a nonres-
ident are treated as giving rise to Country X source
income and are subject to a 20 percent withholding
tax, regardless of whether the nonresident payee has
a taxable presence in Country X. Country X has a
generally-imposed net income tax within the mean-
ing of paragraph (c)(1)(i) of this section, and non-
residents subject to the withholding tax on royalties
are not also subject to a Country X net income tax
on their royalty income. In Year 1, XCo withholds
20u (units of Country X currency) of tax on a 100u
royalty paid to YCo under the Agreement.
(ii) Analysis—(A) Separate levy. Under §1.901-
2(d)(1)(iii)(B)(1), Country X’s withholding tax
imposed on gross royalty income of nonresidents
is treated as a separate levy. Under §1.901-2(d)(1)
(iii)(B)(3), the 20u of Country X withholding tax
imposed on the 100u of royalties paid by XCo to
YCo is treated as a separate levy from the Country X
withholding tax on royalties if the Agreement pursu-
ant to which the royalties are paid is a single-country
license under paragraph (c)(2)(iv) of this section.
The Agreement does not meet the requirements of
paragraph (c)(2)(iv) of this section because it nei-
ther limits the territory of the license to Country
X nor separately states the portion of the payment
that is with respect to the part of the territory of the
license that is solely within Country X. Thus, the
20u of Country X withholding tax paid by YCo is
not treated as a separate levy under §1.901-2(d)(1)
(iii)(B)(3).
(B) Covered withholding tax. Under paragraph
(c)(2) of this section, a tested foreign tax is a cov-
ered withholding tax if paragraphs (c)(1)(i) and (c)
(2)(i) through (iii) of this section are met. Country
X’s withholding tax on royalties meets the require-
ments of paragraphs (c)(1)(i) and (c)(2)(i) and (ii) of
this section because Country X has a generally-im-
posed net income tax, Country X’s withholding tax
on the royalties paid pursuant to the Agreement is
imposed on the gross royalty income of persons who
are nonresidents of Country X, and nonresidents
subject to the withholding tax on royalties are not
also subject to the Country X generally-imposed net
income tax on their royalty income. However, the
Country X withholding tax on royalties paid pursu-
ant to the Agreement does not meet the requirements
of §1.901-2(b)(5)(i)(B) and paragraph (c)(2)(iii)(A)
of this section because Country X’s sourcing rule
for royalties (based on residence of the payor) is not
based on the place of use of, or the right to use, the
intangible property. Additionally, the payment that is
subject to Country X’s withholding tax is not made
pursuant to a single-country license under paragraph
(c)(2)(iv) of this section for the reasons described
in paragraph (d)(3)(ii)(A) of this section (the sepa-
rate levy analysis of this paragraph (d)(3) (Example
3)). Therefore, the requirement in paragraph (c)(2)
(iii)(B) of this section is not met. Accordingly, the
Country X withholding tax paid by YCo is not a
covered withholding tax, and none of the 20u Coun-
try X withholding tax paid by YCo with respect to
the 100u royalty payment made to XCo is a foreign
income tax.
* * * * *
(8) Example 8: Withholding tax on royalties;
single-country license—(i) Facts. The facts are the
same as in paragraph (d)(3)(i) of this section (the
facts of Example 3) except that in Year 1, YCo enters
into a written license agreement (the “Agreement”)
with XCo for the right to use YCo’s IP in a territory
defined by the Agreement as Country X, in exchange

Bulletin No. 2022–49 525 December 5, 2022
for payments that the terms of the Agreement charac-
terize as royalties, and XCo in fact only uses the IP in
Country X. In Year 1, XCo withholds 20u of tax from
100u of royalties paid to YCo under the Agreement.
(ii) Analysis—(A) Separate levy. Under §1.901-
2(d)(1)(iii)(B)(1), Country X’s withholding tax
imposed on gross royalty income of nonresidents
is treated as a separate levy. Under §1.901-2(d)(1)
(iii)(B)(3), the 20u of Country X withholding tax
imposed on the 100u of royalties paid by XCo to
YCo is treated as a separate levy from the Country X
withholding tax on royalties if the Agreement pursu-
ant to which the royalties are paid is a single-country
license under paragraph (c)(2)(iv) of this section.
The Agreement meets the requirements of paragraph
(c)(2)(iv)(A) of this section because it is a written
license agreement that characterizes the payment as a
royalty and limits the territory of the license to Coun-
try X. Thus, the 20u Country X withholding tax paid
by YCo is treated as a separate levy under §1.901-
2(d)(1)(iii)(B)(3).
(B) Covered withholding tax. Under paragraph
(c)(2) of this section, a tested foreign tax is a cov-
ered withholding tax if paragraphs (c)(1)(i) and (c)
(2)(i) through (iii) of this section are met. Country X
has a generally-imposed net income tax, Country X’s
withholding tax on the royalties paid pursuant to the
Agreement is a withholding tax that is imposed on
the gross income of persons who are nonresidents of
Country X, and nonresidents subject to the withhold-
ing tax on royalties paid pursuant to the Agreement
are not also subject to a net income tax on their roy-
alty income. Thus, the requirements of paragraphs
(c)(1)(i) and (c)(2)(i) and (ii) of this section are met.
The withholding tax paid by YCo does not meet the
requirements of §1.901-2(b)(5)(i)(B) and paragraph
(c)(2)(iii)(A) of this section because Country X’s
source rule for royalties (based on residence of the
payor) is not based on the place of use of, or the right
to use, the intangible property. However, the pay-
ment that is subject to Country X’s withholding tax
is made pursuant to a single-country license under
paragraph (c)(2)(iv) of this section for the reasons
described in paragraph (d)(8)(ii)(A) of this section
(the separate levy analysis of this Example 8). There-
fore, the requirement in paragraph (c)(2)(iii)(B) of
this section is met. Accordingly, the Country X with-
holding tax on the payment made by XCo to YCo
pursuant to the Agreement is a covered withholding
tax and all of the 20u of Country X withholding tax
paid by YCo with respect to the 100u of royalties
under the Agreement is a foreign income tax.
(9) Example 9: Withholding tax on royalties;
separately stated portion—(i) Facts. The facts are
the same as in paragraph (d)(3)(i) of this section
(the facts of Example 3) except that in Year 1, YCo
enters into a written agreement (the “Agreement”)
with XCo for the right to use YCo’s IP in a terri-
tory defined by the Agreement as the entire world, as
well as for YCo to provide certain services to XCo
in Country Y, in exchange for a payment equal to 10
percent of XCo’s annual revenue. The Agreement
provides a formula for determining the amount of
the payment that is characterized as a royalty and
that is with respect to the part of the territory that is
within Country X (the “separately stated formula”).
The separately stated formula provides that the first
30u of the payment represents payment for services
provided by YCo, and that 40 percent of the remain-
der of the payment represents payment of a royalty
with respect to the part of the territory of the license
that is solely within Country X. The portion of the
payment by XCo to YCo that is characterized as ser-
vices income under the Agreement is also character-
ized as services income under the laws of Country X.
Additionally, all payments by a resident of Country
X for services provided by a nonresident are treated
as giving rise to Country X source income, regard-
less of where the services are performed, and gross
income from services is subject to the same 20 per-
cent withholding tax as gross royalty income. In Year
1, XCo earns gross income of 1,800u and pays YCo
180u under the Agreement. XCo withholds 12u of
tax from the 60u of royalties attributable to the part
of the territory of the license that is solely within
Country X that are paid to YCo under the separately
stated formula in the Agreement. The portion of the
payment by XCo to YCo that is characterized as a
royalty with respect to the part of the territory of the
license that is solely within Country X under the sep-
arately stated formula in the Agreement is also char-
acterized as a royalty under the laws of Country X.
XCo withholds 24u of tax from the remaining 120u
payment paid to YCo under the Agreement, consist-
ing of 6u of tax on the 30u payment for services and
18u of tax on 90u of royalties. YCo does not know, or
have reason to know, that the terms of the Agreement
misstate the territory in which YCo’s IP is used or
overstate the amount of the royalty with respect to
the part of the territory of the license that is solely
within Country X.
(ii) Analysis—(A) Separately stated portion.
The analysis is the same as in paragraph (d)(8)(ii)
of this section (the analysis of Example 8), except
that the portion of the payment that is a royalty with
respect to the part of the territory of the license that is
solely within Country X under the separately stated
formula in the Agreement is treated as made pursu-
ant to a single-country license under paragraph (c)
(2)(iv) of this section because the Agreement is a
written agreement that separately states the portion
of the payment that is characterized as a royalty and
that is with respect to the part of the territory of the
license that is solely within Country X. Thus, the
Country X withholding tax on the portion of the pay-
ment from XCo to YCo that is a payment of a royalty
with respect to the part of the territory of the license
that is solely within Country X under the separately
stated formula under the Agreement is a separate
levy and a covered withholding tax. Accordingly, the
12u Country X withholding tax paid by YCo from
the 60u of royalties with respect to the part of the
territory of the license that is solely within Country
X is a foreign income tax.
(B) Remaining portion of royalties. The analysis
is the same as paragraph (d)(3)(ii) of this section (the
analysis of Example 3). Specifically, the 18u Coun-
try X withholding tax on the 90u royalty payment
that is not with respect to the part of the territory that
is within Country X is neither a separate levy nor
a covered withholding tax. Accordingly, none of the
18u Country X withholding tax paid by YCo with
respect to the remaining 90u royalty payment under
the Agreement is a payment of foreign income tax.
(C) Services portion. Under §1.901-2(d)(1)
(iii)(B)(1), Country X’s withholding tax imposed
on gross services income of nonresidents is a sep-
arate levy. The Country X withholding tax of 6u
on the 30u payment for services made by XCo to
YCo under the Agreement is not a covered with-
holding tax. The withholding tax paid by YCo does
not meet the requirements of §1.901-2(b)(5)(i)(B)
and paragraph (c)(2)(iii)(A) of this section because
Country X’s sourcing rule for services (based on
residence of the payor) is not reasonably similar
to the sourcing rule that applies under the Internal
Revenue Code (based on where the services are
performed). The special separate levy and covered
withholding tax rules for single-country licenses
under §1.901-2(d)(1)(iii)(B)(3) and paragraph (c)
(2)(iii)(B) of this section do not apply to withhold-
ing taxes on payments for services. Accordingly,
none of the 6u of Country X withholding tax paid
by YCo with respect to the 30u payment for ser-
vices under the Agreement is a payment of foreign
income tax.
(10) Example 10: Characterization of payment—
(i) Facts. The facts are the same as in paragraph (d)
(3)(i) of this section (the facts of Example 3), except
that in Year 1, YCo enters into a written license agree-
ment (the “Agreement”) with XCo for the right to
use YCo’s IP in a territory defined by the Agreement
as Country X, in exchange for a payment that the
terms of the Agreement characterize as a royalty, but
that is characterized as a payment for services under
the laws of Country X, and all payments of services
paid by a resident of Country X to a nonresident are
treated as giving rise to Country X source income,
regardless of where the services are performed, and
are subject to a 20 percent withholding tax.
(ii) Analysis. Under §1.901-2(d)(1)(iii)(B)(1),
Country X’s withholding tax imposed on gross ser-
vices income of nonresidents is a separate levy. The
Country X withholding tax of 20u on the 100u pay-
ment for services made by XCo to YCo under the
Agreement is not a covered withholding tax. The
withholding tax paid by YCo does not meet the
requirements of §1.901-2(b)(5)(i)(B) and paragraph
(c)(2)(iii)(A) of this section because Country X’s
sourcing rule for services (based on residence of the
payor) is not reasonably similar to the sourcing rule
that applies under the Internal Revenue Code (based
on where the services are performed). The special
separate levy and covered withholding tax rules for
single-country licenses under §1.901-2(d)(1)(iii)(B)
(3) and paragraph (c)(2)(iii)(B) of this section do
not apply to withholding taxes on income that is not
characterized as royalty income under the foreign tax
law. Accordingly, none of the 20u Country X with-
holding tax paid by YCo with respect to the 100u
paid under the Agreement is a payment of foreign
income tax.
(11) Example 11: Withholding tax on royalties,
validity of agreement—(i) Facts. The facts are the
same as in paragraph (d)(3)(i) of this section (the
facts of Example 3), except that XCo is a controlled
foreign corporation wholly owned by USP. Addi-
tionally, in Year 2, XCo and YCo cancel the written
license agreement entered into in Year 1 and YCo
enters into two new written license agreements with
XCo, one agreement which grants XCo the right to
use certain YCo IP in a territory defined as Coun-
try X (the “Country X Agreement”), and one of
which grants XCo the right to use the same YCo IP

December 5, 2022 526 Bulletin No. 2022–49
in a territory defined as the entire world except for
Country X (the “Rest of World Agreement”). Both
agreements characterize the payments under the
agreements as royalties, and the payments are also
characterized as royalties under the laws of Country
X. In Year 2, XCo withholds a total of 20u of tax
from a total of 100u of royalties paid to YCo under
the Country X Agreement and the Rest of World
Agreement. Based on the terms of each agreement,
18u of tax was withheld from 90u of royalties paid to
YCo under the Country X Agreement, and 2u of tax
from 10u of royalties paid to YCo under the Rest of
World Agreement. YCo knew or had reason to know
that under the principles of sections 482 and 861,
with respect to the 100u of royalties paid by XCo to
YCo, 40u is attributable to XCo’s use of YCo IP in
Country X and 60u is attributable to use of YCo IP
outside Country X.
(ii) Analysis—(A) Rest of World Agreement. The
analysis is the same as paragraph (d)(3)(ii) of this
section (the analysis of Example 3). Specifically, the
2u Country X withholding tax on the 10u royalty
payment under the Rest of World Agreement is nei-
ther a separate levy nor a covered withholding tax.
Accordingly, none of the 2u Country X withholding
tax paid by YCo with respect to the 10u royalty pay-
ment under the Rest of World Agreement is a pay-
ment of foreign income tax.
(B) Country X Agreement. The analysis is the
same as paragraph (d)(3)(ii) of this section (the anal-
ysis of Example 3), except that the reason that the
Country X Agreement does not meet the require-
ments of paragraph (c)(2)(iv) of this section is that
YCo knew or had reason to know that the terms
of the Country X Agreement overstate the amount
of the royalty with respect to Country X. Thus, the
18u Country X withholding tax on the 90u royalty
payment under the Country X Agreement is nei-
ther a separate levy nor a covered withholding tax.
Accordingly, none of the 18u Country X withholding
tax paid by YCo with respect to the 90u royalty pay-
ment under the Country X Agreement is a payment
of foreign income tax.
(e) Applicability dates—(1) In general.
Except as provided in paragraphs (e)(2)
and (3) of this section, this section applies
to foreign taxes paid (within the meaning
of §1.901-2(g)) in taxable years beginning
on or after December 28, 2021. For for-
eign taxes that relate to (and if creditable
are considered to accrue in) taxable years
beginning before December 28, 2021, and
that are remitted in taxable years begin-
ning on or after December 28, 2021, by a
taxpayer that accounts for foreign income
taxes on the accrual basis, see §1.903-1 as
contained in 26 CFR part 1 revised as of
April 1, 2021.
(2) Certain foreign taxes paid to
Puerto Rico. For foreign taxes paid to
Puerto Rico under section 3070.01 of the
Puerto Rico Internal Revenue Code of
2011, as amended (13 L.P.R.A. 31771)
(imposing an excise tax on a controlled
group member’s acquisition from another
group member of certain personal prop-
erty manufactured or produced in Puerto
Rico and certain services performed in
Puerto Rico), this section applies to for-
eign taxes paid (within the meaning of
§1.901-2(g)) in taxable years beginning
on or after January 1, 2023. For foreign
taxes described in the preceding sentence
that are paid in taxable years beginning
before January 1, 2023, see §1.903-1 as
contained in 26 CFR part 1 revised as of
April 1, 2021.
(3) Modifications to the covered with-
holding tax rules. Paragraphs (c)(2) and
(d)(3), (4), and (8) through (11) of this sec-
tion apply to foreign taxes paid (within the
meaning of §1.901-2(g)) in taxable years
ending on or after November 18, 2022.
For foreign taxes that are paid in taxable
years ending before November 18, 2022,
see §1.903-1(c)(2) and (d)(3) and (4) as
contained in 26 CFR part 1 revised as of
July 27, 2022. Taxpayers may choose to
apply the rules in paragraphs (c)(2) and
(d)(3), (4), and (8) through (11) of this
section to foreign taxes paid in taxable
years beginning on or after December
28, 2021, and ending before November
18, 2022, provided that they consistently
apply those rules and the rules of §1.901-
2(b)(5)(i)(B)(2) and (d)(1)(iii) to such tax-
able years.
Melanie R. Krause,
Acting Deputy Commissioner for Ser-
vices and Enforcement.
(Filed by the Office of the Federal Register on
November 18, 2022, 11:15 a.m., and published in the
issue of the Federal Register for November 22, 2022,
87 F.R. 71271)

Bulletin No. 2022–49 i December 5, 2022
Definition of Terms
Revenue rulings and revenue procedures
(hereinafter referred to as “rulings”) that
have an effect on previous rulings use the
following defined terms to describe the
effect:
Amplified describes a situation where
no change is being made in a prior pub-
lished position, but the prior position is
being extended to apply to a variation of
the fact situation set forth therein. Thus,
if an earlier ruling held that a principle
applied to A, and the new ruling holds that
the same principle also applies to B, the
earlier ruling is amplified. (Compare with
modified, below).
Clarified is used in those instances
where the language in a prior ruling is
being made clear because the language
has caused, or may cause, some confu-
sion. It is not used where a position in a
prior ruling is being changed.
Distinguished describes a situation
where a ruling mentions a previously pub-
lished ruling and points out an essential
difference between them.
Modified is used where the substance
of a previously published position is being
changed. Thus, if a prior ruling held that a
principle applied to A but not to B, and the
new ruling holds that it applies to both A
and B, the prior ruling is modified because
it corrects a published position. (Compare
with amplified and clarified, above).
Obsoleted describes a previously pub-
lished ruling that is not considered deter-
minative with respect to future transactions.
This term is most commonly used in a ruling
that lists previously published rulings that
are obsoleted because of changes in laws or
regulations. A ruling may also be obsoleted
because the substance has been included in
regulations subsequently adopted.
Revoked describes situations where the
position in the previously published ruling
is not correct and the correct position is
being stated in a new ruling.
Superseded describes a situation where
the new ruling does nothing more than
restate the substance and situation of a
previously published ruling (or rulings).
Thus, the term is used to republish under
the 1986 Code and regulations the same
position published under the 1939 Code
and regulations. The term is also used
when it is desired to republish in a single
ruling a series of situations, names, etc.,
that were previously published over a
period of time in separate rulings. If the
new ruling does more than restate the sub-
stance of a prior ruling, a combination of
terms is used. For example, modified and
superseded describes a situation where the
substance of a previously published ruling
is being changed in part and is continued
without change in part and it is desired to
restate the valid portion of the previously
published ruling in a new ruling that is
self contained. In this case, the previously
published ruling is first modified and then,
as modified, is superseded.
Supplemented is used in situations in
which a list, such as a list of the names of
countries, is published in a ruling and that
list is expanded by adding further names
in subsequent rulings. After the original
ruling has been supplemented several
times, a new ruling may be published that
includes the list in the original ruling and
the additions, and supersedes all prior rul-
ings in the series.
Suspended is used in rare situations
to show that the previous published rul-
ings will not be applied pending some
future action such as the issuance of new
or amended regulations, the outcome of
cases in litigation, or the outcome of a
Service study.
Abbreviations
The following abbreviations in current
use and formerly used will appear in
material published in the Bulletin.
A—Individual.
Acq.—Acquiescence.
B—Individual.
BE—Beneficiary.
BK—Bank.
B.T.A.—Board of Tax Appeals.
C—Individual.
C.B.—Cumulative Bulletin.
CFR—Code of Federal Regulations.
CI—City.
COOP—Cooperative.
Ct.D.
—Court Decision.
CY—County.
D—Decedent.
DC—Dummy Corporation.
DE—Donee.
Del. Order—Delegation Order.
DISC—Domestic International Sales Corporation.
DR—Donor.
E—Estate.
EE—Employee.
E.O.—Executive Order.
ER—Employer.
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduciary.
FC—Foreign Country.
FICA—Federal Insurance Contributions Act.
FISC—Foreign International Sales Company.
FPH—Foreign Personal Holding Company.
F.R.—Federal Register.
FUTA—Federal Unemployment Tax Act.
FX—Foreign corporation.
G.C.M.—Chief Counsel’s Memorandum.
GE—Grantee.
GP—General Partner.
GR—Grantor.
IC—Insurance Company.
I.R.B.—Internal Revenue Bulletin.
LE—Lessee.
LP—Limited Partner.
LR—Lessor.
M—Minor.
Nonacq.—Nonacquiescence.
O—Organization.
P—Parent Corporation.
PHC—Personal Holding Company.
PO—Possession of the U.S.
PR—Partner.
PRS—Partnership.
PTE—Prohibited Transaction Exemption.
Pub. L.—Public Law.
REIT—Real Estate Investment Trust.
Rev. Proc.—Revenue Procedure.
Rev. Rul.—Revenue Ruling.
S—Subsidiary.
S.P.R.—Statement of Procedural Rules.
Stat.—Statutes at Large.
T—Target Corporation.
T.C.—Tax Court.
T.D.—Treasury Decision.
TFE—Transferee.
TFR—Transferor.
T.I.R.—Technical Information Release.
TP—Taxpayer.
TR—Trust.
TT—Trustee.
U.S.C.—United States Code.
X—Corporation.
Y—Corporation.
Z—Corporation.

December 5, 2022 ii Bulletin No. 2022–49
Numerical Finding List
1
Bulletin 2022–49
Announcements:
2022-14, 2022-31 I.R.B. 136
2022-15, 2022-31 I.R.B. 136
2022-16, 2022-33 I.R.B. 144
2022-17, 2022-35 I.R.B. 179
2022-18, 2022-36 I.R.B. 190
2022-19, 2022-36 I.R.B. 191
2022-20, 2022-38 I.R.B. 238
2022-21, 2022-46 I.R.B. 464
2022-22, 2022-47 I.R.B. 497
2022-23, 2022-48 I.R.B. 499
Notices:
2022-29, 2022-28 I.R.B. 66
2022-30, 2022-28 I.R.B. 70
2022-31, 2022-29 I.R.B. 85
2022-32, 2022-32 I.R.B. 137
2022-33, 2022-34 I.R.B. 147
2022-34, 2022-34 I.R.B. 150
2022-35, 2022-36 I.R.B. 184
2022-36, 2022-36 I.R.B. 188
2022-37, 2022-37 I.R.B. 234
2022-38, 2022-39 I.R.B. 239
2022-39, 2022-40 I.R.B. 264
2022-40, 2022-40 I.R.B. 266
2022-42, 2022-41 I.R.B. 276
2022-44, 2022-41 I.R.B. 277
2022-43, 2022-42 I.R.B. 303
2022-45, 2022-42 I.R.B. 307
2022-41, 2022-43 I.R.B. 304
2022-46, 2022-43 I.R.B. 306
2022-47, 2022-43 I.R.B. 312
2022-48, 2022-43 I.R.B. 316
2022-49, 2022-43 I.R.B. 321
2022-50, 2022-43 I.R.B. 325
2022-51, 2022-43 I.R.B. 331
2022-52, 2022-43 I.R.B. 337
2022-53, 2022-45 I.R.B. 437
2022-54, 2022-45 I.R.B. 439
2022-55, 2022-45 I.R.B. 443
2022-56, 2022-47 I.R.B. 480
2022-57, 2022-47 I.R.B. 482
2022-58, 2022-47 I.R.B. 483
2022-59, 2022-48 I.R.B. 498
2022-60, 2022-49 I.R.B. 502
2022-62, 2022-49 I.R.B. 506
Proposed Regulations:
REG-130975-08, 2022-28 I.R.B. 71
REG 130675-17, 2022-30 I.R.B. 104
REG-125693-19, 2022-39 I.R.B. 241
REG-110368-22, 2022-44 I.R.B. 405
Proposed Regulations:—Continued
REG-100719-21, 2022-45 I.R.B. 457
REG-121509-00, 2022-45 I.R.B. 463
REG-112096-22, 2022-49 I.R.B. 511
Revenue Procedures:
2022-25, 2022-27 I.R.B. 3
2022-28, 2022-27 I.R.B. 65
2022-26, 2022-29 I.R.B. 90
2022-32, 2022-30 I.R.B. 101
2022-30, 2022-31 I.R.B. 112
2022-29, 2022-33 I.R.B. 141
2022-34, 2022-33 I.R.B. 143
2022-35, 2022-40 I.R.B. 270
2022-36, 2022-40 I.R.B. 274
2022-19, 2022-41 I.R.B. 282
2022-31, 2022-43 I.R.B. 339
2022-37, 2022-43 I.R.B. 377
2022-38, 2022-45 I.R.B. 445
2022-40, 2022-47 I.R.B. 487
2022-39, 2022-49 I.R.B. 507
Revenue Rulings:
2022-12, 2022-27 I.R.B. 1
2022-13, 2022-30 I.R.B. 99
2022-14, 2022-31 I.R.B. 110
2022-15, 2022-35 I.R.B. 152
2022-17, 2022-36 I.R.B. 182
2022-18, 2022-40 I.R.B. 262
2022-19, 2022-44 I.R.B. 379
2022-20, 2022-45 I.R.B. 407
2022-21, 2022-47 I.R.B. 468
2022-22, 2022-49 I.R.B. 500
Treasury Decisions:
9963, 2022-34 I.R.B. 145
9964, 2022-35 I.R.B. 172
9965, 2022-37 I.R.B. 192
9966, 2022-44 I.R.B. 380
9967, 2022-44 I.R.B. 385
9968, 2022-45 I.R.B. 409
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2021–27 through 2021–52 is in Internal Revenue Bulletin
2021–52, dated December 27, 2021.

Bulletin No. 2022–49 iii December 5, 2022
Finding List of Current Actions on
Previously Published Items
1
Bulletin 2022–49
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2021–27 through 2021–52 is in Internal Revenue Bulletin
2021–52, dated December 27, 2021.

Internal Revenue Service
Washington, DC 20224
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INTERNAL REVENUE BULLETIN
The Introduction at the beginning of this issue describes the purpose and content of this publication. The weekly Internal Revenue
Bulletins are available at www.irs.gov/irb/.
We Welcome Comments About the Internal Revenue Bulletin
If you have comments concerning the format or production of the Internal Revenue Bulletin or suggestions for improving it,
we would be pleased to hear from you. You can email us your suggestions or comments through the IRS Internet Home Page
www.irs.gov) or write to the Internal Revenue Service, Publishing Division, IRB Publishing Program Desk, 1111 Constitution Ave.
NW, IR-6230 Washington, DC 20224.