Internal Revenue Bulletin 2023-11 (PDF rendition): IRS Notices

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Bulletin No. 2023–11
March 13, 2023
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
Notice 2023-21, page 563.
This notice under § 7508A of the Internal Revenue Code
postpones the beginning of the lookback periods under
§ 6511 for certain taxpayers to file a claim for refund. The
affected taxpayers are those that had tax returns due from
April 15, 2020, to July 15, 2020, or from April 15, 2021, to
May 17, 2021, and due to the COVID-19 pandemic, those
due dates were postponed by Notice 2020-23 or Notice
2021-21 to July 15, 2020 or May 17, 2021, respectively.
Those 2020 and 2021 notices did not postpone the be-
ginning of the lookback periods under § 6511 for claiming
refunds related to those returns. This notice aligns the look-
back periods with the postponed 2020 and 2021 tax return
filing due dates.
T.D. 9972, page 530.
The final regulations amend the rules for filing certain re-
turns and statements electronically to reflect changes
made by the Taxpayer First Act of 2019 and to promote
electronic filing.
EMPLOYEE PLANS
Notice 2023-19, page 560.
This notice sets forth updates on the corporate bond
monthly yield curve, the corresponding spot segment rates
for February 2023 used under § 417(e)(3)(D), the 24-month
average segment rates applicable for February 2023, and
the 30-year Treasury rates, as reflected by the application
of § 430(h)(2)(C)(iv).
REG 122286-18, page 565.
These proposed regulations provide rules relating to the use
of forfeitures in qualified retirement plans, including a dead-
line for the use of forfeitures in defined contribution plans,
and clarify that forfeitures arising in any defined contribution
plan (including in a money purchase pension plan) may be
used for one or more of the following purposes, as specified
in the plan: (1) to pay plan administrative expenses, (2) to
reduce employer contributions under the plan, or (3) to in-
crease benefits in other participants’ accounts in accordance
with plan terms. The proposed regulations would require that
plan administrators use or allocate forfeitures no later than
12 months after the close of the plan year in which the for-
feitures are incurred. The proposed regulations also update
rules relating to the use of forfeitures in defined benefit plans
to reflect statutory changes enacted after the existing regu-
lations were promulgated.
INCOME TAX
AOD 2023-2, page 529.
Issue 1:
Nonacquiescence to the court’s conclusion that the parties’
failure to report the transactions fully or consistently should
not be a major factor in a decision whether to allow a tax-
payer to disavow the form of its transactions and also to
the standard the court applied to allow petitioner to disavow
its form in this case.
Issue 2:
Nonacquiescence to the court’s determination that the fair
market value of a “Deferred Payment Right” (as described
therein) for purposes of section 351(b)(1) is not equal to its
issue price.
T.D. 9973, page 557.
This document contains final regulations that treat mem-
bers of a consolidated group as a single United States
shareholder in certain cases for purposes of section 951(a)
(2)(B) of the Internal Revenue Code.
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 en-
force 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 of-
ficial 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.
March 13, 2023 Bulletin No. 2023–11

Actions Relating to Court
Decisions
It is the policy of the Internal Reve­
nue Service to announce at an early date
whether it will follow the holdings in cer­
tain cases. An Action on Decision is the
document making such an announcement.
An Action on Decision will be issued at
the discretion of the Service only on un­
appealed issues decided adverse to the
government. Generally, an Action on De­
cision is issued where its guidance would
be helpful to Service personnel working
with the same or similar issues. Unlike a
Treasury Regulation or a Revenue Ruling,
an Action on Decision is not an affirma­
tive statement of Service position. It is not
intended to serve as public guidance and
may not be cited as precedent.
Actions on Decisions shall be relied
upon within the Service only as conclu­
sions applying the law to the facts in the
particular case at the time the Action on
Decision was issued. Caution should be
exercised in extending the recommenda­
tion of the Action on Decision to similar
cases where the facts are different. More­
over, the recommendation in the Action
on Decision may be superseded by new
legislation, regulations, rulings, cases, or
Actions on Decisions.
Prior to 1991, the Service published
acquiescence or nonacquiescence only
in certain regular Tax Court opinions.
The Service has expanded its acqui­
escence program to include other civil
tax cases where guidance is determined
to be help ful. Accordingly, the Service
now may acquiesce or nonacquiesce in
the holdings of memorandum Tax Court
opinions, as well as those of the Unit­
ed States District Courts, Claims Court,
and Circuit Courts of Appeal. Regard­
less of the court decid ing the case, the
recommendation of any Action on De­
cision will be published in the Internal
Revenue Bulletin.
The recommendation in every Action
on Decision will be summarized as ac­
quiescence, acquiescence in result only,
or nonacquiescence. Both “acquies­
cence” and “acquiescence in result only”
mean that the Service accepts the holding
of the court in a case and that the Ser­
vice will follow it in disposing of cases
with the same controlling facts. How­
ever, “acqui escence” indicates neither
approval nor disapproval of the reasons
assigned by the court for its conclusions;
whereas, “acqui escence in result only”
indicates disagree ment or concern with
some or all of those reasons. “Nonacqui­
escence” signifies that, although no fur­
ther review was sought, the Service does
not agree with the hold ing of the court
and, generally, will not follow the deci­
sion in disposing of cases involving other
taxpayers. In reference to an opinion of a
circuit court of appeals, a “nonacquies­
cence” indicates that the Ser vice will not
follow the holding on a na tionwide ba­
sis. However, the Service will recognize
the precedential impact of the opinion on
cases arising within the venue of the de­
ciding circuit.
The Commissioner DOES NOT AC­
QUIESCE in the following decision:
Complex Media, Inc. v. Commission-
er, T.C. Memo. 2021-14
1
1
Issue 1:

Nonacquiescence to the court’s conclusion that the parties’ failure to report the transactions fully or consistently should not be a major factor in a decision whether to allow a taxpayer to
disavow the form of its transactions and also to the standard the court applied to allow petitioner to disavow its form in this case.

Issue 2:

Nonacquiescence to the court’s determination that the fair market value of a “Deferred Payment Right” (as described therein) for purposes of section 351(b)(1) is not equal to its issue price.
Bulletin No. 2023–11 529 March 13, 2023

Part I
T.D. 9972
DEPARTMENT OF THE
TREASURY
Internal Revenue Service
26 CFR Parts 1, 53, 54,
and 301
Electronic-Filing
Requirements for Specified
Returns and Other
Documents
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Final regulation.
SUMMARY: This document contains
final regulations amending the rules for
filing electronically and affects persons
required to file partnership returns, cor­
porate income tax returns, unrelated busi­
ness income tax returns, withholding tax
returns, certain information returns, regis­
tration statements, disclosure statements,
notifications, actuarial reports, and certain
excise tax returns. The final regulations
reflect changes made by the Taxpayer
First Act (TFA) and are consistent with
the TFA’s emphasis on increasing elec­
tronic filing.
DATES: Effective date: These regulations
are effective on February 23, 2023.
Applicability dates: For dates of applica­
bility, see §§1.1461­1(j), 1.1474­1(j), 1.6033­
4(b), 1.6037­2(b), 1.6045­2(i), 1.6045­4(s),
1.6050I­1(h), 1.6050I­2(f), 1.6050M­1(f),
53.6011­1(e), 54.6011­3(f), 301.1474­1(e),
301.6011­2(g), 301.6011­3(f), 301.6011­5(f),
301.6011­10(c), 301.6011­11(e), 301.6011­
12(f), 301.6011­13(f), 301.6011­14(f),
301.6011­15(f), 301.6012­2(f), 301.6033­
4(d), 301.6037­2(f), 301.6057­3(f), 301.6058­
2(f), 301.6059­2(e), and 301.6721­1(h).
FOR FURTHER INFORMATION
CONTACT: Casey R. Conrad of the Of­
fice of the Associate Chief Counsel (Pro­
cedure and Administration), (202) 317­
6844 (not a toll­free number). The phone
number above may also be reached by in­
dividuals who are deaf or hard of hearing
or who have speech disabilities through
the Federal Relay Service toll­free at
(800) 877­8339.
SUPPLEMENTARY INFORMATION:
Background
This document contains amendments to
the Regulations on Income Taxes (26 CFR
part 1) under sections 1461 and 1474 of
the Internal Revenue Code (Code), which
provide that persons required to deduct
and withhold tax are liable for such tax;
under sections 6045 and 6050M of the
Code, which require persons to file and
furnish certain information with respect to
transactions and contracts; and under sec­
tion 6050I of the Code, which requires per­
sons to report information about financial
transactions to the IRS; to the Regulations
on Pension Excise Taxes (26 CFR part 54)
under section 6011 of the Code, which
requires persons to report information for
certain excise taxes related to employee
benefit plans; to the Regulations on Foun­
dation and Similar Excise Taxes (26 CFR
part 53) under section 6011 of the Code to
remove the option—available to a person
required to report certain excise taxes on
Form 4720, Return of Certain Excise Tax-
es Under Chapters 41 and 42 of the Inter-
nal Revenue Code—to designate a Form
4720 filed by a private foundation or trust
as that person’s return if the foundation is
reporting the same transaction; and to the
Regulations on Procedure and Adminis­
tration (26 CFR part 301) under sections
1474, 6011, 6012, 6033, 6057, 6058, and
6059 of the Code for determining whether
returns must be filed using magnetic me­
dia (references to ‘‘electronic form’’ are
used in place of ‘‘magnetic media’’).
On July 1, 2019, the President signed
into law the TFA, Public Law 116­25,
133 Stat. 981 (2019). Section 2301 of the
TFA amended section 6011(e) by add­
ing new paragraph 5 that authorizes the
Secretary of the Treasury or her delegate
(Secretary) to prescribe regulations that
decrease, in accordance with the TFA,
the number of returns a taxpayer may file
without being required to file electroni­
cally. Section 3101 of the TFA amended
section 6011 to require any charitable or
other organization required to file an an­
nual return that relates to any tax imposed
by section 511 on unrelated business tax­
able income to file those returns in elec­
tronic form. Section 3101 of the TFA also
amended section 6033 to require any or­
ganization required to file a return under
section 6033 to file those returns in elec­
tronic form.
On July 23, 2021, the Department of
the Treasury (Treasury Department) and
the IRS published a notice of proposed
rulemaking (NPRM) (REG­102951­16)
in the Federal Register (86 FR 39910),
providing guidance on the electronic­fil­
ing rules for partnership returns, corporate
income tax returns, unrelated business
income tax returns, withholding tax re­
turns, certain information returns, regis­
tration statements, disclosure statements,
notifications, actuarial reports, and certain
excise tax returns. The 2021 proposed
regulations also withdrew the proposed
regulations published in the Federal
Register on May 31, 2018, amending the
rules for determining whether information
returns must be filed electronically. The
2018 and 2021 proposed regulations are
included in the rulemaking docket for this
Treasury Decision on www.regulations.
gov.
Summary of Comments and
Explanation of Revisions
The Treasury Department and the IRS
received 22 comments in response to the
proposed regulations. All comments were
considered and are available at www.reg-
ulations.gov or upon request. A public
hearing was held on September 22, 2021.
Three commenters testified at the public
hearing. The comments that are within the
scope of the regulations are summarized
and discussed in this preamble.
After consideration of the comments,
the Treasury Department and the IRS
adopt the proposed regulations as revised
by this Treasury Decision. To the extent
March 13, 2023 530 Bulletin No. 2023–11

Bulletin No. 2023–11 531 March 13, 2023
not inconsistent with the Summary of
Comments and Explanation of Revisions
section of this preamble, the Explanation
of Provisions section of the preamble to
the proposed regulations is incorporated
in this document.
I. The Applicability Date of the Final
Regulations
A. Applicable for Returns Required to be
Filed in 2024
In general, the proposed regulations
provide that the amended electronic­fil­
ing rules would be applicable to returns
required to be filed during calendar years
beginning after the date of publication of
the Treasury Decision in the Federal Reg-
ister. The proposed regulations provide
for other applicability dates depending
on the filing requirements for specific tax
forms. For example, the proposed regula­
tions provide that the changes to the elec­
tronic­filing rules would apply to returns
required to be filed under §301.6058­2 for
plan years that begin on or after January
1, 2022, but only for filings with a filing
deadline (not taking into account exten­
sions) after July 31, 2022.
The majority of commenters recom­
mended delaying the applicability of the
proposed changes by at least one calendar
year to provide time for their customers to
adjust inventories; for software companies
to adjust their programming; for paper
filers and the IRS to adjust their process­
es; and for the IRS to communicate the
changes to the public. One commenter, a
manufacturer and supplier of tax forms,
expressed concern that the timing of the
proposed changes would impose financial
burdens on their customers, buyers, and
resellers of tax forms, because planning
and purchasing inventory had already be­
gun when the proposed regulations were
published. That commenter also was con­
cerned that those filers needing a Trans­
mitter Control Code (TCC), required for
electronically filing most information
returns, would not be able to obtain one
for the 2022 filing season, because appli­
cations for a TCC were due by November
1, 2021. Another commenter, a seller of
paper forms, similarly noted that demand
for paper tax forms generally begins long
before the filing season starts, and that tax
professionals and suppliers had already
begun ordering and shipping paper tax
forms for the 2022 filing season before
the proposed regulations were published.
The commenters also asserted that chang­
es in the electronic­filing rules made near
the start of filing season have a substantial
impact on tax­software companies that
must adjust their systems to comply with
the changes.
Other commenters supported the
IRS’s efforts to modernize the return­fil­
ing process to require withholding agents
to electronically file Form 1042, An-
nual Withholding Tax Return for U.S.
Source Income of Foreign Persons, and
shared the IRS’s desire to improve the
timeliness and accuracy of refunds and
credits claimed by foreign persons with
amounts withheld. But they suggested
that the IRS delay the applicability date
of the proposed changes by at least one
calendar year to provide time for the IRS
and withholding agents to prepare for the
electronic filing of Forms 1042. They
requested that the IRS provide electron­
ic­filing specifications for Forms 1042 as
soon as possible, and once provided, al­
low additional time to create and test the
required software.
The Treasury Department and the IRS
understand the concerns raised by com­
menters with respect to applicability dates
of the regulations contained in this Trea­
sury Decision. The Treasury Department
and the IRS believe that making the new
provisions for electronic filing applicable
to returns and other documents required
to be filed during calendar year 2024
will give affected persons ample time to
prepare. Accordingly, final regulations
§§1.1461­1(j), 1.1474­1(j), 1.6037­2(b),
1.6045­2(i), 1.6045­4(s), 1.6050I­1(h),
1.6050I­2(f), 1.6050M­1(f)(4), 54.6011­
3(f), 301.1474­1(e), 301.6011­2(g)(1),
301.6011­3(f), 301.6011­5(f), 301.6011­
11(e), 301.6011­12(f), 301.6011­
13(f), 301.6011­14(f), 301.6011­15(f),
301.6012­2(f), 301.6037­2(f), and
301.6721­1(h) provide that the new pro­
visions for electronic filing will apply
for returns and other documents required
to be filed during calendar year 2024.
Sections 301.6057­3(f), 301.6058­2(f),
301.6059­2(e) provide that the new pro­
visions for electronic filing will apply for
plan years that begin on or after January
1, 2024. To avoid partial retroactive effect
with respect to certain non­calendar­year
taxpayers, final regulations §§301.6011­
12(f), 301.6011­13(f), and 301.6012­2(f)
specify that these provisions apply to
returns required to be filed for taxable
years ending on or after December 31,
2023. In light of the applicability dates,
the language “but only for filings with a
filing deadline (not taking into account
extensions) after July 31, 2022” that was
included in proposed §§301.6057­3(f),
301.6058­2(f), and 301.6059­2(e) has
been removed from the final regulations.
B. Applicability date for forms under
section 3101 of the TFA
Section 3101 of the TFA amended
section 6011 of the Code to require any
organization required to file an annual re­
turn that relates to any tax imposed by sec­
tion 511 on unrelated business taxable in­
come to file the return in electronic form.
Section 3101 of the TFA also amended
section 6033 to require any organization
required to file a return under section 6033
to file the return in electronic form. Unlike
section 2301 of the TFA, the provisions in
section 3101 of the TFA are self­executing
and generally apply to taxable years begin­
ning after July 1, 2019, in accordance with
section 3101(d) of the TFA. The applica­
bility date of final regulations §§1.6033­
4(b), 53.6011­1(e), 301.6011­10(c), and
301.6033­4(d) (returns required to be filed
during calendar years beginning after the
date of publication of the Treasury Deci­
sion in the Federal Register) does not af­
fect the requirements under section 3101
of the TFA.
II. The Electronic-Filing Rules for
Information Returns
A. The electronic-filing threshold
Proposed §301.6011­2(b) and (c) pro­
vide that if a person is required to file,
during calendar year 2022, a total of at
least 100 information returns covered by
§301.6011­2(b)(1) and (2), and during
calendar years 2023 and after, a total of
at least 10 such returns, the person is re­
quired to file those information returns
electronically (electronic­filing threshold
for information returns). Because these

March 13, 2023 532 Bulletin No. 2023–11
final regulations are not applicable until
calendar year 2024, the proposed elec­
tronic­filing thresholds of 100 for returns
required to be filed in calendar year 2022,
and 10 returns for returns required to be
filed in calendar year 2023 are not adopt­
ed. The electronic­filing threshold for re­
turns required to be filed in calendar years
2022 and 2023 remains at 250. The final
regulations adopt, however, the proposed
electronic­filing threshold of 10 for re­
turns required to be filed on or after Jan­
uary 1, 2024, as authorized by Congress’s
enactment of section 2301 of the TFA.
Two commenters disagreed with the
proposed reduction to 10 returns for small
businesses. Both questioned the need for
an electronic­filing rule at all and suggest­
ed that businesses should be afforded flex­
ibility in how they file their returns, rather
than be required to file returns electroni­
cally when they have filed paper returns
for years. The first commenter supported
the proposed reduction of the electron­
ic­filing threshold for information returns
from 250 to 100 returns but disagreed
with the proposed reduction to 10 returns
because it was “unnecessary and lacks
empathy for the challenges facing small
businesses.” The second believed that any
reduction to the electronic­filing threshold
should be a small, gradual reduction and
added that some small businesses have lit­
tle to no understanding of the Internet and
requiring these filers to electronically file
their returns would be challenging.
The Treasury Department and the IRS
disagree with the commenters’ suggestions
because electronic filing has become more
common, accessible, and economical, as
evidenced by the prevalence of tax­return
preparers and third­party service provid­
ers who offer return­preparation and elec­
tronic­filing services; by the availability
of tax­return­preparation software; and
by the numbers of returns already being
filed electronically on a voluntary basis.
Although the Treasury Department and
the IRS understand that these changes to
the electronic­filing requirements may
constitute a burden in the short term for
some filers, the final regulations do not
adopt these comments. To address any
undue hardship that these changes to the
electronic­filing rules may have on certain
small businesses that are paper informa­
tion­return filers, the IRS will continue to
grant hardship waivers fairly and consis­
tently and to grant reasonable­cause relief
from penalties for failure to file returns
electronically in appropriate cases. Ad­
ditionally, the Treasury Department and
the IRS expect the administrative costs
to electronically file returns to be further
reduced for taxable year 2022 and later
years with the launch of the Information
Returns Intake System (IRIS) Taxpayer
Portal, an internet platform for Form 1099
filings.
B. Filing corrected information returns in
same manner as originals
Proposed §301.6011­2(c)(4)(ii) pro­
vides a rule for the manner of filing cor­
rected returns. Proposed §301.6011­2(c)
(4)(ii)(A) provides that if a person is re­
quired to file original information returns
electronically, that person must file any
corresponding corrected information re­
turns electronically. Proposed §301.6011­
2(c)(4)(ii)(B) provides that, if a person is
permitted to file information returns on
paper and does file those information re­
turns on paper, that person must also file
any corresponding corrected information
returns on paper.
One commenter generally supported
the corrected­return rule, but expressed
concern that the rule could occasionally
be an inconvenience to some people or
that an intervening event could occur that
would require filers to change their meth­
od of filing. Two other commenters noted
that the corrected­return rule would add an
additional burden on filers because many
software options provide electronic filing
of original returns but not corrected ones.
One of these commenters recommend­
ed that the Treasury Department and the
IRS delay requiring filers to correct their
electronically­filed returns electronically
until the IRS has a platform in place (for
example, the internet platform for Form
1099 filings required by section 2102 of
the TFA) that will accept corrected infor­
mation returns online. Another comment­
er opined that the IRS should not require
corrected returns to be filed in a particular
manner, but should instead “encourage the
most efficient way to serve the majority
better.”
The final regulations do not adopt
these comments. The Treasury Depart­
ment and the IRS have determined that,
because of the disparate procedures for
processing paper and electronic infor­
mation returns, the corrected­return rule
will increase the IRS’s timeliness and ac­
curacy in processing information returns,
which will improve tax administration
with respect to corrected returns. The
Treasury Department and the IRS expect
that the number of software options pro­
viding electronic filing for corrected re­
turns will increase to meet that expected
increase in demand. The IRS will work
with the tax­software community to en­
courage them to develop software op­
tions for corrections. If an intervening
event or the cost to purchase electron­
ic­filing software for corrected informa­
tion returns would cause a filer undue
hardship, the filer may request a waiver
from the electronic­filing requirement
for the corrected information returns. As
discussed in this preamble, the changes
to the information return electronic­filing
rules, including the corrected­return rule,
in this Treasury Decision will apply for
returns required to be filed after Decem­
ber 31, 2023, which is after the launch of
the Form 1099 filing platform. See sec­
tion I.A. Applicable for Returns Required
to be Filed in 2024.
C. TCC issues for non-United States
(U.S.) filers
The proposed regulations would in­
crease the number of non­U.S. filers
required to electronically file their in­
formation returns. On July 26, 2021, the
IRS announced changes to the proce­
dures for filers to authenticate their iden­
tities to create an account to apply for a
TCC, which is required to electronically
file most information returns. See FIRE
System Update: Improving the Process
and Security for Information Return (IR)
Application for Transmitter Control Code
(TCC), IRS (Oct. 1, 2021), https://www.
irs.gov/tax-professionals/fire-system-up-
date-improving-the-process-and-secu-
rity-for-information-return-ir-applica-
tion-for-transmitter-control-code-tcc (last
visited January 13, 2023).
Several commenters expressed con­
cern with the changes to the authentica­
tion identity­proofing procedures. One
commenter mentioned that a significant

Bulletin No. 2023–11 533 March 13, 2023
number of qualified intermediaries and
foreign filers would not be able to elec­
tronically file information returns, such
as Forms 1042­S, Foreign Person’s U.S.
Source Income Subject to Withholding,
and 1099, because the new authentication
procedures require users to have U.S.­
based information, such as a U.S. Tax­
payer Identification Number, U.S. tele­
phone number, or U.S. financial account,
to authenticate their identity before ob­
taining a TCC. Two other commenters
expressed similar concerns with respect
to all non­U.S. filers, specifically noting
that due to client confidentiality and re­
lated issues, it is not feasible to require
non­U.S. filers to engage third parties to
file returns on their behalf. Two of the
commenters recommended the IRS ex­
clude qualified intermediaries and other
non­U.S. filers from the secure authen­
tication identity­proofing procedures to
ensure they can continue to submit their
information returns electronically. The
other commenters recommended that the
IRS, without compromising the security
objectives, make accommodations for
foreign filers so they can continue to file
their information returns electronically.
The Treasury Department and the IRS
are aware of this authentication issue for
non­U.S. filers, but the final regulations
do not adopt the suggestion to provide a
blanket electronic­filing exemption for
non­U.S. filers. The IRS’s preferred ap­
proach, in light of the TFA’s emphasis to
increase electronic filing, is to develop
alternative authentication requirements
for identity proofing in accordance with
standards set forth by the U.S. Department
of Commerce, National Institute of Stan­
dards and Technology (NIST). The IRS is
thus actively working to develop updated
authentication procedures for non­U.S. fil­
ers that comply with the NIST standards
and will inform the public in subsequent
guidance or public pronouncement when
these procedures become available.
D. Form 1042-S issues
Proposed §301.6011­2(b)(1) includes
Form 1042­S in the list of information
returns covered by the electronic­fil­
ing rules set forth in that regulation.
Form 1042­S has been included in the
regulation since 1986. The proposed reg­
ulation, however, counts all the informa­
tion returns in the aggregate to determine
if the filer must electronically file. In ad­
dition, the proposed regulation decreases
the number of information returns that
can be filed on paper from 250 to 10, for
returns required to be filed in calendar
year 2023 and after. Two commenters
requested that the Treasury Department
and the IRS remove Form 1042­S en­
tirely from the list of returns included in
the proposed regulations because of the
changes to Form 1042­S since 2013. For
example, the 2013 Form 1042­S code
for “other income” was income code
50, but the “other income” code was lat­
er changed to income code 23. The two
commenters opined that changes to these
codes could confuse filers and recipi­
ents of the form, and that updating the
software to address these changes could
present challenges to software providers.
One of the commenters stated that the
proposed regulations would dispropor­
tionately affect occasional and low­vol­
ume filers of the Form 1042­S who may
not have sufficient resources to com­
ply with the proposed regulations. Both
commenters opined that, if Form 1042­S
is removed from the aggregation rule, the
IRS would not need as many resources to
deal with improper filing errors and re­
quests for a waiver from electronic filing
for Forms 1042­S.
The final regulations do not adopt
these comments. Although Form 1042­
S underwent several changes for taxable
year 2014 to accommodate reporting of
payments and amounts withheld under
the provisions of the Foreign Account
Tax Compliance Act, the form has not un­
dergone a large number of changes since
then. For example, the 2022 Form 1042­
S added to the form four new codes, but
each was assigned a completely new num­
ber that was not previously listed on the
2021 Form 1042­S. Absent extraordinary
circumstances, such as relevant statutory
changes, no substantial changes to the in­
come codes on Form 1042­S are expected
at this time. To the extent, however, that
taxpayers receiving Forms 1042­S have
questions about how to report the infor­
mation, the IRS updates the Instructions
for Form 1042­S and the instructions for
income tax returns each year so that tax­
payers will have the most up­to­date in­
formation. Finally, the Treasury Depart­
ment and the IRS have determined that the
benefits to be gained in the form of faster
and more accurate return processing out­
weigh any concerns about IRS resources
needed in processing electronic­filing
waiver requests.
III. Waiver and Exemptions
As described in the preamble to the
proposed regulations, many of the regu­
lations imposing electronic­filing require­
ments also provide a waiver from elec­
tronic filing to any person who establishes
undue hardship. The Treasury Department
and the IRS specifically requested com­
ments on how the hardship­waiver proce­
dures should be administered, including
suggestions for revising the procedures
for requesting, and criteria for granting,
a hardship waiver, and received several
comments in response.
A. Cost concerns
One commenter generally supported
the proposed rules, noting that electronic
filing not only significantly reduces paper
waste but also is faster and more reliable
than paper filings, which can get lost in the
mail. Another commenter agreed that all
persons should “get on board with the dig­
ital age of tax record keeping and filing,”
but commented that new small businesses
with little resources and businesses that
have paper filed for years may not want to
file electronically or may not know how.
Both commenters expressed concern over
the cost of electronic filing, suggesting
that the IRS waive all or part of the cost
for low­income taxpayers and others ex­
periencing financial hardship.
The final regulations do not adopt these
comments. The preamble to the proposed
regulations describes the recent reduction
in costs to electronically file and the sig­
nificant benefits of moving to electronic
filing. To address any undue hardship on
certain small businesses arising from these
changes to the electronic­filing rules, the
Treasury Department and the IRS will
continue to administer the hardship­waiv­
er program fairly and consistently and to
grant reasonable­cause relief from penal­
ties for failure to file returns electronically
in appropriate cases.

March 13, 2023 534 Bulletin No. 2023–11
B. General waiver and exemption
procedures
Three commenters expressed concern
that, unless the IRS provides adminis­
trative exemptions or hardship waivers,
the proposed regulations under sec­
tion 6011(e) would impose burdens upon
discrete populations including, for exam­
ple, members of certain religious commu­
nities; remote populations; and elderly in­
dividuals without adequate technological
literacy.
With respect to religious communi­
ties, the commenters noted that members
of certain religious communities, in ac­
cordance with their religious practices,
generally do not use technology and have
tenets and teachings that prohibit commu­
nity members from having internet access
or the technology required to electronical­
ly file tax returns. The commenters thus
expressed concern that the reduction of
the electronic­filing threshold to 10 re­
turns with respect to information returns,
partnership returns, corporate income tax
returns, and electing small business in­
come tax returns would now require many
small business owners who are members
of these religious communities to file
these returns electronically, in violation of
their religious practices. The commenters
recommended two alternative changes to
the waiver procedures: that the Treasury
Department and the IRS expand the cur­
rent waiver request form, Form 8508, Re-
quest for Waiver From Filing Information
Returns Electronically, to include either
a one­time or an annual application for
exemption from electronic­filing require­
ments, based on religious beliefs, for any
form the filer is required to file electroni­
cally; or that a new form be created, sim­
ilar to Form 8948, Preparer Explanation
for Not Filing Electronically, that could
be attached to the paper­filed return to
explain that the filer was filing on paper
because of religious beliefs.
The Treasury Department and the IRS
agree that filers for whom using the tech­
nology required to file in electronic form
conflicts with their religious beliefs should
be granted administrative exemptions
from the electronic­filing requirements
for information returns under §301.6011­
2; partnership returns under §301.6011­
3; corporate income tax returns under
§301.6011­5; electing small business
income tax returns under §301.6037­2;
and other returns and statements that the
IRS determines appropriate. To that end,
final regulations §§301.6011­2(c)(6)(ii);
301.6011­3(b)(2); 301.6011­5(b)(2); and
301.6037­2(b)(2) provide that an exemp­
tion will be allowed for filers for whom us­
ing the technology required to file in elec­
tronic form conflicts with their religious
beliefs. Additionally, except as described
in section III.C. of this preamble, the final
regulations authorize the Commissioner
to provide exemptions from the electron­
ic­filing requirements to promote effective
and efficient tax administration. Finally,
these final regulations clarify that a sub­
mission claiming an exemption should be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
posting to the IRS.gov website. In gen­
eral, exemptions will be made available
on a form­by­form basis rather than on a
per­filer basis to allow the IRS to appro­
priately address differences in filing re­
quirements and filer populations.
With respect to remote populations,
one of the commenters expressed concern
that many Native tribes, such as Native
Alaskan tribes, lack access to Internet and
computers and that the reduction of the
electronic­filing threshold for informa­
tion returns would impact some of these
Native Alaskans, for example, a com­
mercial fishing captain. This commenter
also stated that a disproportionate number
of Americans in business age 65 or old­
er may lack the ability or accessibility
to electronically file tax returns and that
the cost for these older taxpayers to pay
a third party to electronically file could
force them out of business. The comment­
er asked whether factors other than finan­
cial cost, such as a filer’s lack of access to
digital technology or a filer’s age, are fac­
tored into the IRS’s decision on whether
to grant a waiver request. The commenter
further expressed concern that granting a
hardship waiver is discretionary and that
the procedures do not include an objective
threshold or standard on how much the
cost to electronically file must exceed the
cost to paper file for the IRS to grant an
electronic­filing waiver. The commenter
thus recommended that the Treasury De­
partment and the IRS expand or clarify
that the hardship­waiver procedures to in­
clude Native tribes and other persons with
difficulty accessing or using technology.
The Treasury Department and the IRS
expect rural filers without access to inter­
net and older filers that lack digital literacy
to make good faith efforts to comply with
the electronic­filing requirements of these
regulations, which may require obtaining
additional assistance to electronically file.
To the extent the burden of obtaining the
necessary assistance to file returns would
cause undue hardship, the filers may sub­
mit a hardship­waiver request from the
electronic­filing requirements.
Under section 6011(e)(2)(B) of the
Code, the IRS must consider (among oth­
er relevant factors) the taxpayer’s ability
to comply at a reasonable cost with the
requirements of such regulations. To de­
termine whether a taxpayer can comply
with the electronic­filing requirements
at a reasonable cost, the IRS requires the
taxpayer to provide two estimates of the
cost that the taxpayer would incur to con­
vert to electronic filing. Financial cost,
however, is not the only factor that the
IRS may consider. Under current proce­
dures, for example, the IRS will consider
granting a waiver from the electronic­fil­
ing requirements for information returns
covered under §301.6011­2(b) if a fire,
casualty, or natural disaster affected the
operation of the business. The proposed
hardship­waiver language, for example in
proposed §301.6011­2(c)(6)(i), provides
that “[t]he principal factor in determin­
ing hardship will be the amount, if any,
by which the cost of filing the return elec­
tronically in accordance with this section
exceeds the cost of filing the return on
paper.” Because the IRS takes other fac­
tors into consideration when analyzing a
request for a waiver from electronic­fil­
ing requirements, the final regulations are
modified to read, “One principal factor in
determining hardship will be the amount,
if any, by which the cost of filing the re­
turn electronically in accordance with this
section exceeds the cost of filing the re­
turn on paper.” The Treasury Department
and the IRS anticipate that additional
details on the specific hardship­waiv­
er procedures for each form affected by
this Treasury Decision will be included
in future public releases of IRS forms
and instructions. After considering pub­

Bulletin No. 2023–11 535 March 13, 2023
lic comments, the IRS revised the Form
8508 in January 2023 to clarify the cir­
cumstances the IRS may accept to justi­
fy a waiver from the e­filing requirement
for the information returns listed on the
Form, including hardships other than fi­
nancial hardship. The Treasury Depart­
ment and the IRS have thus determined
that the IRS’s current hardship­waiver
procedures provide appropriate relief to
rural and older taxpayers from any undue
burdens arising from these changes to the
electronic­filing rules. Reasonable cause
relief from penalties may also be avail­
able for these filers.
The final regulations also clarify that,
if the IRS’s systems do not support elec­
tronic filing for a specific return required
to be filed electronically with the IRS, a
taxpayer will not be required to file the
return electronically. Several of the final
regulations require the electronic filing of
returns that were previously filed on paper
only. If the IRS’s systems do not have the
capacity to accept a particular type of re­
turn electronically when the electronic­fil­
ing requirements become applicable, this
provision clarifies that a taxpayer will not
be required to file that type of return elec­
tronically. In such situations, a taxpayer
will not be required to submit a request
for a hardship waiver to file that type of
return on paper.
Finally, one of the commenters ex­
pressed concern with the statement in the
proposed regulations that “a request for a
hardship waiver must be made in accor­
dance with postings, guidance, forms or
instructions, including those on the IRS.
gov website” because these discrete pop­
ulations, without access to the website,
might not have the latest guidance post­
ed to the website, and so might be filing a
hardship­waiver request based on outdat­
ed guidance from paper forms and instruc­
tions. The commenter thus recommended
that the IRS be lenient in imposing penal­
ties on taxpayers of faiths who avoid tech­
nology, filers that lack access to technolo­
gy, and older Americans who in good faith
request a hardship waiver in compliance
with outdated guidance.
The Treasury Department and the IRS
have determined that to the extent that a
taxpayer can show reasonable cause for
failure to file electronically, including val­
id impediments to making a proper waiver
request, the penalty for failure to file will
not apply.
C. Exceptions to general waiver and
exemption procedures
The final regulations do not provide
for waivers and exemptions in all circum­
stances or for all tax forms required to be
electronically filed.
1. Returns required under section 3101 of
the TFA
Section 3101 of the TFA sets forth two
requirements for mandatory electronic
filing by tax­exempt organizations: under
new section 6011(h), organizations with
returns relating to any tax imposed under
section 511 on unrelated business taxable
income “shall file such return in electron­
ic form,” and under new section 6033(n),
organizations with returns required to be
filed under section 6033 “shall file such
return in electronic form.” Thus, the TFA
amendments expand the class of forms
that tax­exempt entities are currently re­
quired to file electronically, such as the
Form 990­N, Electronic Notice (e-Post-
card), and Form 8871, Political Organi-
zation Notice of Section 527 Status.
Section 3101 of the TFA states that
organizations required to file a return un­
der sections 6011(h) or 6033(n) “shall”
file such return in electronic form and
does not provide for any waiver or alter­
native method to meet the electronic­fil­
ing requirements. The legislative history
to section 3101 of the TFA explains that
mandatory electronic filing by all tax­ex­
empt organizations required to file returns
will improve efficiency, reduce costs, and
generally improve oversight of tax­ex­
empt organizations. H. Rep. No. 116­39,
at 97­98 (2019). Section 3101 of the TFA
also amended section 6104(b) to provide
that “[a]ny annual return required to be
filed electronically under section 6033(n)
shall be made available by the Secretary
to the public as soon as practicable in a
machine­readable format.” The legislative
history explains that it is important to in­
crease the transparency of, and enhance
public access to, information about tax­ex­
empt organizations, particularly charitable
organizations. Id. The legislative history
further explains that this will expedite the
publication of the information required to
be disclosed by the IRS and will enhance
its usability by stakeholders attempting
to exercise oversight of tax­exempt orga­
nizations. Id. Such stakeholders include
not only members of the public who may
support or donate to an organization, but
also state and local officials charged with
oversight responsibilities and responsibil­
ity for prosecuting fraudulent charities.
In contrast to forms affected by section
2301 of the TFA, there is no requirement
that an alternate paper filing process be
provided for certain filers of forms af­
fected by section 3101 of the TFA (such
as for filers filing fewer than 10 returns).
Further, in contrast to forms affected by
section 2301 of the TFA, information re­
turns affected by section 3101 of the TFA
are required to be released to the public
in machine­readable format under section
6104(b), a process that would be ham­
pered if the IRS were required to accept
paper returns and frustrate the intent of
Congress to expedite the publication of
those returns. Proposed §§301.6011­10
and 301.6033­4, consistent with the statu­
tory mandate to require all forms affected
by section 3101 of the TFA to be electron­
ically filed, did not provide for any waiv­
er or exemption from the electronic filing
requirements.
While public comments generally re­
questing waivers or exemptions from
the electronic filing requirements under
certain circumstances were received,
§§301.6011­10 and 301.6033­4 are final­
ized without waiver or exemption provi­
sions because providing a waiver or ex­
emption provision would be contrary to
the plain language of section 3101 of the
TFA and inconsistent with the legislative
history to that section. Notwithstanding
that, the Religious Freedom Restoration
Act of 1993, Public Law 103­141 (107
Stat. 1488), may provide an exemption
for any filer for whom using the technolo­
gy required to file electronically conflicts
with their religious beliefs.
2. Qualified plan returns filed through
EFAST2
On July 21, 2006, the Department of
Labor (DOL) published a final rule in the
Federal Register (71 FR 41359), requir­
ing electronic filing of the Form 5500,

March 13, 2023 536 Bulletin No. 2023–11
Annual Return/Report of Employee Ben-
efit Plan, and Form 5500­SF, Short Form
Annual Return/Report of Small Employee
Benefit Plan, for plans covered by Title I
of the Employee Retirement Income Se­
curity Act, Public Law 93­406 (88 Stat.
854), as amended (ERISA) for plan years
beginning on or after January 1, 2008. On
November 16, 2007, the DOL published
a final rule in the Federal Register (72
FR 64710), postponing the effective date
of the electronic filing mandate so that the
mandate applies to plan years beginning
on or after January 1, 2009. See 29 CFR
§2520.104a­2.
Filers of the Form 5500 and Form
5500­SF are required to file electronical­
ly through DOL’s computerized ERISA
Filing Acceptance System (EFAST2).
Rev. Proc. 2015­47, 2015­39 IRB 419,
sets forth procedures to request a waiver
of the electronic­filing requirement due to
economic hardship for plan administrators
of retirement plans (or, in certain situa­
tions, employers maintaining retirement
plans) that are required to file electronical­
ly certain employee benefit plan returns.
Section 3 of Rev. Proc. 2015­47 provides
that, because filers of Form 5500 and
Form 5500­SF are required to file those
returns electronically through DOL’s
EFAST2, a waiver of the electronic­fil­
ing requirement for those forms will not
be granted. Because an actuarial report
required under section 6059 is filed with
Form 5500 or Form 5500­SF as a schedule
and is also required to be filed electron­
ically through DOL’s EFAST2, a waiver
of the electronic­filing requirement for the
actuarial report also will not be granted.
Sections 301.6058­2 and 301.6059­2 of
the final regulations continue to provide
that the Commissioner may waive the
electronic­filing requirements under sec­
tions 6058 and 6059 in cases of undue
economic hardship, and that a request
for a waiver must be made in accordance
with applicable IRS revenue procedures,
publications, forms, instructions, or other
guidance, including postings to the IRS.
gov website. However, pursuant to section
3 of Rev. Proc. 2015­47, waivers of the
electronic­filing requirement for Forms
5500 and 5500­SF (and related actuarial
reports) will continue to not be granted.
In addition, §§301.6058­2 and 301.6059­
2 of the final regulations do not provide
for any exemptions to the electronic­filing
requirement for Forms 5500 and 5500­SF
(and related actuarial reports) because,
unlike other filings described in this Trea­
sury Decision, Forms 5500 and 5500­SF
(and related actuarial reports) are required
to be filed electronically through DOL’s
EFAST2.
3. Form 8300
If filed electronically, Forms 8300,
Report of Cash Payments Over $10,000
Received in a Trade or Business, are not
filed electronically with the IRS; rather
they are filed electronically through the
Financial Crimes Enforcement Network’s
(FinCEN) BSA E­Filing System. The
Treasury Department, FinCEN, and the
IRS have determined that most Form 8300
filers who might have difficulty filing
electronically and might therefore need
a waiver, would likely not be required to
file electronically in the first place because
they would not meet the electronic­filing
threshold in §301.6011­2(c), even after
that threshold is reduced to 10 returns. See
section II.A. Accordingly, the Treasury
Department, FinCEN, and the IRS have
determined that there is no need for a sep­
arate waiver process for Form 8300 filers.
Instead, Form 8300 filers who request and
receive a waiver under §301.6011­2(c)
for any return required to be filed under
§301.6011­2(b)(1) or (2) will automati­
cally be deemed to have received an elec­
tronic­filing waiver for any Forms 8300
the filer is required to file for the duration
of the calendar year.
IV. Form 1042 Substantiation
Requirements to Claim Credit on Line 67
Proposed §§301.1474­1(a) and
301.6011­15(a) would require certain
filers to electronically file Forms 1042.
Forms 1042 have previously been filed
only on paper. For Form 1042 filers that
claim a credit on line 67 for taxes with­
held by other withholding agents, the fil­
ers substantiate this credit by attaching, to
the Form 1042, paper copies of the Forms
1042­S they received from those other
withholding agents.
In light of the electronic­filing require­
ments for Form 1042, two commenters
requested the IRS remove the requirement
to provide paper copies of Forms 1042­S
to support the claim made on line 67 of
the Form 1042, suggesting that the IRS
would already have electronic copies of
the Forms 1042­S filed by the other with­
holding agents, making the requirement
duplicative.
The final regulations do not adopt these
comments as they are outside the scope of
these regulations, which do not impose
the requirement to provide paper copies.
Nonetheless, the IRS is actively working
to develop programming that would allow
filers to electronically attach or submit
Forms 1042­S with their Forms 1042 to
substantiate their claimed credit on Line
67. The IRS expects to have programming
in place consistent with the applicability
dates in these final regulations.
V. Regulatory Flexibility Act Certification
One commenter expressed concern
that, although the proposed regulations
certify that they will not have a significant
economic impact on a substantial number
of small entities for purposes of the Regu­
latory Flexibility Act, the regulations will
in fact have a “significant economic im­
pact” on small entities.
The Treasury Department and the IRS
maintain their certification that the final
rules will not have a significant economic
impact on a substantial number of small
entities for the reasons discussed in sub­
section II, Regulatory Flexibility Act, of
the following Special Analyses section of
this preamble.
VI. Clarification on a Failure to File
Electronically When Required
The proposed regulations provide that
if a filer fails to file a return or report elec­
tronically when required to do so by the
regulations, the filer is “deemed” to have
failed to file the return or report. The word
“deemed” is superfluous because a tax­
payer who fails to file electronically when
required to do so by these regulations has
failed to file. Therefore, for sake of clar­
ification, the Treasury Department and
the IRS have made minor edits to remove
the word deemed from final regulations
§§54.6011­3(c), 301.1474­1(c), 301.6011­
10(b), 301.6011­12(c), 301.6011­
13(c), 301.6011­14(c), 301.6011­15(c),

Bulletin No. 2023–11 537 March 13, 2023
301.6012­2(c), 301.6033­4(b), and
301.6721­1(a)(2)(ii).
VII. Clarification on 10-Return
Calculation for Material Advisor
Disclosure Statements
Under section 6111 and §301.6111­3(a)
and (e), each material advisor is required
to file a Form 8918, Material Advisor Dis-
closure Statement, with respect to any re­
portable transaction by the last day of the
month that follows the end of the calendar
quarter in which the advisor became a ma­
terial advisor with respect to the reportable
transaction or in which the circumstances
necessitating an amended disclosure state­
ment occur. Thus, a material advisor may
not know the number of Forms 8918 it will
be required to file during a calendar year
until after the end of the third quarter of
the calendar year. On the other hand, oth­
er returns—for example, Forms 1099, in­
come tax returns, employment tax returns,
and excise tax returns–have fixed due dates
by which those returns must be filed each
calendar year. A filer of those returns will
therefore know at the beginning of the
calendar year whether the filer is required
to file at least 10 returns of those types.
Thus, the Treasury Department and the
IRS clarify in these final regulations that
a material advisor will be required to file
its Forms 8918 electronically or in other
machine­readable form in accordance with
revenue procedures, publications, forms,
instructions, or other guidance, including
postings on the IRS.gov website, during the
calendar year only if the material advisor
is required to file at least 10 returns of any
type, other than Forms 8918. This clarifica­
tion will help ensure material advisors un­
derstand early in the calendar year whether
any Forms 8918 must be filed electronical­
ly or in other machine­readable form with­
out complications of being unable to deter­
mine at the beginning of a calendar year the
number of Forms 8918 that may need to be
filed during the calendar year.
Special Analyses
I. Regulatory Planning and Review –
Economic Analysis
Executive Orders 12866 and 13563 di­
rect agencies to assess costs and benefits
of available regulatory alternatives and, if
regulation is necessary, to select regulato­
ry approaches that maximize net benefits
(including (i) potential economic, envi­
ronmental, and public health and safety
effects, (ii) potential distributive impacts,
and (iii) equity). Executive Order 13563
emphasizes the importance of quanti­
fying both costs and benefits, reducing
costs, harmonizing rules, and promoting
flexibility.
These final regulations have been des­
ignated as subject to review under Exec­
utive Order 12866 pursuant to the Mem­
orandum of Agreement (April 11, 2018)
(MOA) between the Treasury Department
and the Office of Management and Budget
(OMB) regarding review of tax regula­
tions. The Office of Information and Reg­
ulatory Affairs has designated these final
regulations as significant under section
1(b) of the MOA.
A. Background, Need for the Final
Regulations, and Economic Analysis of
Final Regulations
The Tax Equity and Fiscal Responsi­
bility Act of 1982 (TEFRA), Public Law
97–248, (96 Stat. 610), first directed the
Secretary to prescribe regulations for re­
quiring returns to be filed on magnetic
media, a term generally used to refer to
electronic filing at that time. TEFRA pro­
hibited the Secretary from requiring in­
come tax returns of individuals, estates,
and trusts to be filed in a manner other
than on paper forms. In 1998, Congress
amended section 6011(e) of the Code to
prohibit the Secretary from requiring the
electronic filing of a return unless the fil­
er is required to file at least 250 returns
during the calendar year. The Treasury
Department and the IRS subsequently is­
sued regulations that required a person to
file information returns electronically if
that person is required to file 250 or more
information returns in a calendar year.
The regulations provide that the 250­re­
turn threshold applied separately to each
type of information return covered under
the regulations. The Treasury Department
and the IRS also issued regulations that
set a 250­return threshold in determining
whether large corporation tax returns, S
corporation tax returns, and other returns
must be electronically filed.
Since 1998, the technology underlying
electronic filing has become much more
widely available, both in the form of tax
return preparation software and electronic
filing services offered by tax return pre­
parers and other service providers. By
2019, over 98.8 percent of information
returns were already being filed electron­
ically. In July of that year, the President
signed into law the Taxpayer First Act
(TFA). The TFA authorizes the Secretary
to prescribe regulations that decrease the
number of returns a filer may file without
being required to file electronically from
250 to 10.
When returns are filed on paper, the
IRS transcribes much of the input data to
electronic format. In some cases, employ­
ees must manually input this data, requir­
ing significant IRS resources to be spent
on otherwise needless processing and
data entry rather than serving taxpayers in
other ways. Manual data entry can cause
delays in the input and retrieval of data,
affecting the timeliness and accuracy of
processing these forms. This can lead to
delays or other disadvantageous outcomes
for taxpayers. In some cases, manual data
entry can cause delays in the information
available for law enforcement and other
users to detect potential money launder­
ing, terrorist financing, and other tax and
financial fraud. Moreover, the increased
accuracy of the data received from elec­
tronic filing reduces transcription errors
and the cost for the IRS and taxpayers to
resolve these errors.
These final regulations impose elec­
tronic­filing requirements on persons re­
quired to file certain returns, including
partnership returns, corporate income
tax returns, unrelated business income
tax returns, withholding tax returns, and
certain information returns, registration
statements, disclosure statements, notifi­
cations, actuarial reports, and certain ex­
cise tax returns. Specifically, the final reg­
ulations reduce the 250­return threshold
enacted in 1998 to the 10­return threshold
provided by the TFA. Under current reg­
ulations, the 250­return threshold applies
separately to each type of information
return covered under the regulations. The
final regulations require filers to aggregate
across returns types to determine whether
a filer meets the 10­return threshold and is
thus required to file electronically.

March 13, 2023 538 Bulletin No. 2023–11
The IRS receives nearly 4 billion infor­
mation returns per year and projects that by
2028, it will receive over 5 billion infor­
mation returns each year. See https://www.
irs.gov/statistics/soi-tax-stats-calendar-
year-projections-publication-6961 (last
visited January 13, 2023). In 2019, the IRS
received nearly 40 million paper informa­
tion returns even though approximately 99
percent of all information returns for that
year were filed electronically.
For taxable year 2020, the data shows
that creating a 50­return threshold would
require 1­2 percent of the largest paper in­
formation return filers to file electronical­
ly, resulting in approximately 23 percent
of all paper information returns current­
ly filed to be filed electronically. For the
same year, a 25­return threshold would
require approximately 4­5 percent of the
largest paper information return filers to
file electronically, resulting in approxi­
mately 39­41 percent of paper information
returns currently filed to be filed electron­
ically. At the 10­return threshold, the IRS
is only requiring 13­16 percent of the larg­
est paper information return filers to file
electronically, but this will result in 62­64
percent of all outstanding paper informa­
tion returns to be filed electronically.
In 2020, approximately 13 million out
of 35 million paper information returns
were filed by filers filing 1­10 returns and
these filers averaged 2.78 returns each.
This means approximately 85 percent of
all paper information return filers would
not be subject to the electronic­filing man­
date at a 10­return threshold based on the
2020 data, yet nearly two­thirds of all pa­
per information returns would then be re­
quired to be filed electronically. Thus the
high rate of electronic filing does not ne­
gate the need for regulations to further re­
duce the number of paper returns the IRS
is required to manually process each year.
Because the vast majority of returns
subject to these final regulations are al­
ready filed electronically, the Treasury
Department and the IRS expect that the
final regulations will not have any mean­
ingful impact on economic behavior. Elec­
tronic filing has become more common,
accessible, and economical. The table be­
low shows recent trends in the electron­
ic­filing rates of tax returns and informa­
tion returns. Eighty­one percent of all tax
returns, including 95 percent of individual
income tax returns, were filed electroni­
cally in fiscal year 2020, rising from 68
percent for all tax returns and 87 percent
for individual income tax returns in 2016.
Nearly all information returns submitted
to the IRS were filed electronically.
from 68 percent for all tax returns and 87 percent for individual income tax returns in 2016.
Nearly all information returns submitted to the IRS were filed electronically.
Fiscal Year20162017201820192020
All tax returns68%70%71%73%81%
Individual income tax returns87%88%88%90%95%
Information returns, excluding forms processd by the Social
Secuirty Administration (Form SSA-1099, Form RRB-1099, and
W-2)
99%99%99%99%100%
Data source: IRS Publication 6292 and IRS Data Book

In the limited circumstances in which
In the limited circumstances in which the cost to comply with these electronic-filing
requirements would cause undue hardship, many of these regulations provide a waiver from
electronically filing. The IRS routinely grants meritorious hardship waiver requests. According
to the regulations, such undue hardship could be caused by a range of factors that are not limited
to the financial cost that would be incurred by the filer. For example, a hardship to comply with
the electronic-filing requirements can apply to remote populations with limited online access and
filers who lack adequate technological proficiency. Regardless of the factors, little economic
burden is expected for the waiver process because submitting a hardship waiver requires no more
technology than filing paper returns. For information returns, waiver requests can be made for
many returns on the same Form 8508. (See instructions for Form 8508.)
In addition to hardship waivers, the final regulations provide exemptions for religious
communities for whom using the technology required to file in electronic form conflicts with
their religious beliefs. An exemption means that filers do not have to be pre-approved to paper
file. Thus, filers that are eligible for an exemption would not experience additional burden under
the regulations.
In enacting TFA, Congress made clear its intention to broaden the requirements to file
returns electronically. However, the broadened requirements intended by Congress will not
occur without final regulations. In the absence of these regulations, the IRS would continue to
devote resources to costly and inefficient processing of paper filings, resources that could be
allocated to modernization of IT infrastructure.
the cost to comply with these electron­
ic­filing requirements would cause un­
due hardship, many of these regulations
provide a waiver from electronically fil­
ing. The IRS routinely grants meritori­
ous hardship waiver requests. According
to the regulations, such undue hardship
could be caused by a range of factors
that are not limited to the financial cost
that would be incurred by the filer. For
example, a hardship to comply with the
electronic­filing requirements can apply
to remote populations with limited online
access and filers who lack adequate tech­
nological proficiency. Regardless of the
factors, little economic burden is expected
for the waiver process because submitting
a hardship waiver requires no more tech­
nology than filing paper returns. For in­
formation returns, waiver requests can be
made for many returns on the same Form
8508. (See instructions for Form 8508.)
In addition to hardship waivers, the
final regulations provide exemptions for
religious communities for whom using
the technology required to file in elec­
tronic form conflicts with their religious
beliefs. An exemption means that filers
do not have to be pre­approved to paper
file. Thus, filers that are eligible for an ex­
emption would not experience additional
burden under the regulations.
In enacting TFA, Congress made clear
its intention to broaden the requirements
to file returns electronically. However,
the broadened requirements intended
by Congress will not occur without final
regulations. In the absence of these reg­
ulations, the IRS would continue to de­
vote resources to costly and inefficient
processing of paper filings, resources that
could be allocated to modernization of IT
infrastructure.
Significant administrative costs in­
clude the time it takes an IRS employee
to manually process paper information
returns. First, the IRS employee must
open and inspect the mail to determine
what type of return or other form is in
the envelope, re­route the form if need­
ed, ensure the return is processable and
includes a Taxpayer Identification Num­
ber (TIN), and then date stamp the return.
This initial step must take place within
30 days of receipt to allow timely corre­
spondence with the filer of processable
returns to give the filer time to correct the
mistakes and re­file.
The IRS employee must next review
the return to determine whether it is scan­
nable or non­scannable, which includes
removing staples and taping any cuts or
torn portions of the document. The IRS
employee must then cross check the in­
formation on the returns against the par­
ent transmittal return (Form 1096) for the
payer’s TIN, payer’s name, and if either
is missing or illegible, cross check other
submissions for the information or send
correspondence to the filer.
Scannable submissions are then pre­
pared for processing through the Service
Center Recognition/Image Processing
System (SCRIPS). Non­scannable sub­

Bulletin No. 2023–11 539 March 13, 2023
missions are sorted, coded, and batched
after ensuring all necessary information
is included, which varies between types
of information returns. The batched in­
formation returns are then forwarded to
the appropriate IRS facility for Integrated
Submission and Remittance Processing
(ISRP). The ISRP employee must manu­
ally enter all required fields and add the
appropriate document and format codes
in accordance with the Internal Revenue
Manual.
In August 2020, the IRS projected the
potential cost and savings for implementa­
tion of the reduction of the electronic­fil­
ing threshold. The IRS estimated that the
savings for IRS Submission Processing
(IRS SP) due to fewer paper information
returns to process when the electronic­fil­
ing threshold was reduced from 250 to 100
returns is 35 full­time equivalents (FTEs),
or $2 million. This savings would be offset
by the cost to enroll new participants in
the FIRE System, which the IRS estimat­
ed would cost 9 FTEs, or $500,000. Thus,
the IRS’s net savings as a result of the re­
duction to the electronic­filing threshold
from 250 to 100 returns is estimated to be
26 FTEs, or $1.5 million.
The IRS estimated that the savings for
IRS SP due to fewer paper information
returns to process when the electronic fil­
ing threshold was reduced from 100 to 10
returns is 147 FTEs, or $8.3 million. This
savings would be offset by the cost to en­
roll new participants in the FIRE System,
which the IRS estimated would cost 40
FTEs, or $2.3 million. Thus, the IRS’s net
savings as a result of the reduction to the
electronic­filing threshold from 100 to 10
returns is estimated to be 107 FTEs, or $6
million.
Finally, the IRS estimated that the sav­
ings for IRS SP due to fewer paper infor­
mation returns to process when the elec­
tronic­filing threshold was reduced from
250 to 10 returns is 182 FTEs, or $10.3
million. For the first year of the reduction,
the savings would be offset by the cost to
enroll new participants in the FIRE Sys­
tem, which the IRS estimated would cost
49 FTEs, or $2.8 million. Thus, for the
first year of implementation, the IRS’s net
savings as a result of the reduction to the
electronic­filing threshold from 250 to 10
returns is estimated to be 133 FTEs, or
$7.5 million.
For each subsequent year, the IRS esti­
mated that the savings for IRS SP due to
fewer paper information returns to process
is 147 FTEs, or $8.3 million, which would
be offset by some cost for telephone
support.
An increase in electronic filing percent­
age rates change will result in millions
fewer paper documents, freeing up valu­
able IRS resources for other tasks. Based
on taxable year 2020 data, a 10­return
electronic­filing threshold would have re­
sulted in approximately 21 million fewer
paper information returns. While the IRS
projects the number of paper returns will
continue to decrease even absent changes
to the regulations, the decrease is project­
ed to be gradual.
Requiring more electronic filing
would increase the timeliness and accu­
racy of data entry, reduce postage costs,
promote IT modernization efforts, real­
locate IRS staff for priority assignments,
and provide IRS criminal and civil inves­
tigators and other agencies with access to
the data with more up­to­date and accu­
rate information. Moreover, increased ef­
ficiency in processing returns will allow
the IRS to provide faster and better cus­
tomer service to taxpayers. Given the in­
creasing prevalence of electronic filings
in recent years, the final regulations re­
duce the 250­return threshold enacted in
1998 to the 10­return threshold provided
by the TFA.
II. Regulatory Flexibility Act
Pursuant to the Regulatory Flexibili­
ty Act (5 U.S.C. chapter 6), it is hereby
certified that these regulations will not
have a significant economic impact on a
substantial number of small entities. Al­
though these rules may affect a substantial
number of small entities, for the reasons
discussed in the following paragraphs, the
economic impact is not significant.
Under section 6011(e) of the Code and
§§1.6050M­1, 301.6011­2, 301.6011­3,
301.6011­5, 301.6037­2, 301.6057­3,
301.6058­2, and 301.6059­2, filers are
already required to file returns and state­
ments electronically if, during a calendar
year, they are required to file 250 or more
returns. The eight rules—§§1.6050M­1,
301.6011­2, 301.6011­3, 301.6011­5,
301.6037­2, 301.6057­3, 301.6058­2, and
301.6059­2—will lower the 250­return
threshold to 10, as authorized by section
6011(e), as amended by section 2301 of
the TFA. A filer may request that the IRS
waive the electronic­filing requirement
if the filer’s cost to comply with the rule
would cause a financial hardship. The
cost to electronically­file for a filer varies
by form and by how many types of forms
the filer is required to file. For example,
low volume information return filers
can electronically­file for approximately
$3.25 per form, with options available for
filing an unlimited number of informa­
tion returns starting at $120. Commercial
software is available for business returns
such as Forms 1120 for as low as $125.
The IRS routinely grants meritorious
hardship­waiver requests. Accordingly,
the economic burden on the limited num­
ber of small entities that are not currently
filing electronically will be slight; small
entities that would experience a financial
hardship because of these eight rules may
seek a waiver. Requesting a waiver will
impose a minor cost in the form of time
to read the expanded instructions, gather
and prepare for submission the informa­
tion and documents substantiating the
request (if needed), and to complete the
form itself.
Under section 6050I of the Code and
§§1.6050I­1 and 1.6050I­2, filers are re­
quired to file Forms 8300 if, in the course
of their trade or business, they receive
more than $10,000 in cash (as that term is
defined in section 6050I(d)) in one trans­
action or in two or more related trans­
actions. The rule under §301.6011­2(b)
(3) requires filers of Forms 8300 to file
those forms electronically if such filers
are also required to file returns electron­
ically under paragraphs (b)(1) and (2) of
§301.6011­2. The Treasury Department
and the IRS expect filers of Form 8300
to use FinCEN’s BSA E­Filing System,
which is free and may be accessed with an
internet connection. See https://bsaefiling.
fincen.treas.gov/main.html (last visited
January 13, 2023). The filers may incur
minor costs in the form of time needed to
enroll in FinCEN’s BSA E­Filing System
and to become familiar with the system,
but the enrollment process should only
take several minutes. The economic im­
pact on small entities should thus not be
significant.

March 13, 2023 540 Bulletin No. 2023–11
Under section 6011(e)(4) of the Code
and §301.1474­1, financial institutions
defined in section 1471(d)(5) of the
Code already are required to electron­
ically file Forms 1042­S. The rule un­
der §301.1474­1(a) extends this filing
requirement to Forms 1042 filed by the
same financial institutions. Small enti­
ties that would experience a financial
hardship because of this rule may seek a
hardship waiver.
Under section 6011(h) of the Code, as
amended by section 3101 of the TFA, or­
ganizations required to file annual returns
relating to any tax imposed by section 511
must file those returns in electronic form.
Because the regulation §301.6011­10
implements this statutory requirement,
the economic impact of the regulation
on small organizations should thus be
insignificant.
Under section 6033(n), as amended by
section 3101 of the TFA, organizations re­
quired to file returns under section 6033
must file those returns in electronic form.
Because the regulations under §§1.6033­
4, 53.6011­1, and 301.6033­4 implement
this statutory requirement, the economic
impact of these regulations on small orga­
nizations should thus be insignificant.
The seven regulations under
§§54.6011­3, 301.6011­11, 301.6011­12,
301.6011­13, 301.6011­14, 301.6011­15,
and 301.6012­2 require electronic filing
for certain returns not currently required
to be filed electronically. Because elec­
tronic filing has become more common,
accessible, and economical, the econom­
ic impact of these rules on small entities
should be insignificant. Moreover, as
discussed above, if the cost to comply
with these electronic­filing requirements
would cause a financial hardship, an en­
tity may request a waiver. The IRS rou­
tinely grants meritorious hardship waiv­
er requests. Accordingly, the burden on
small entities affected by these rules will
be slight.
Accordingly, it is hereby certified that
these regulations will not have a signifi­
cant economic impact on a substantial
number of small entities within the mean­
ing of section 601(6) of the RFA.
Pursuant to section 7805(f) of the In­
ternal Revenue Code, the NPRM preced­
ing this regulation was submitted to the
Chief Counsel for the Office of Advocacy
of the Small Business Administration for
comment on its impact on small business.
No comments were received from the
Chief Counsel for the Office of Advoca­
cy of the Small Business Administration.
III. Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates
Reform Act of 1995 requires that agencies
assess anticipated costs and benefits and
take certain other actions before issuing a
final rule that includes any Federal man­
date that may result in expenditures in any
one year by a state, local, or tribal gov­
ernment, in the aggregate, or by the pri­
vate sector, of $100 million in 1995 dol­
lars, updated annually for inflation. This
regulation does not include any Federal
mandate that may result in expenditures
by state, local, or tribal governments,
or by the private sector in excess of that
threshold.
IV. Executive Order 13132: Federalism
Executive Order 13132 (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 gov­
ernments, and is not required by statute,
or preempts state law, unless the agency
meets the consultation and funding re­
quirements of section 6 of the Executive
Order. This rule does not have federalism
implications and does not impose sub­
stantial direct compliance costs on state
and local governments or preempt state
law within the meaning of the Executive
Order.
V. Congressional Review Act
Pursuant to the Congressional Review
Act (5 U.S.C. 801 et seq.), the Office of
Information and Regulatory Affairs des­
ignated this rule as not a “major rule,” as
defined by 5 U.S.C 804(2).
Statement of Availability of IRS
Documents
IRS revenue procedures, notices, and
other guidance cited in this document are
published in the Internal Revenue Bulletin
and are available from the Superintendent
of Documents, U.S. Government Publish­
ing Office, Washington, DC 20402, or by
visiting the IRS website at http://www.irs.
gov.
Drafting Information
The principal author of these final reg­
ulations is Casey R. Conrad of the Office
of the Associate Chief Counsel (Proce­
dure and Administration). Other person­
nel from the Treasury Department and the
IRS participated in the development of the
regulations.
List of Subjects
26 CFR Part 1
Income taxes, Reporting and record­
keeping requirements.
26 CFR Part 53
Excise taxes, Foundations, Invest­
ments, Lobbying, Reporting and record­
keeping requirements.
26 CFR Part 54
Excise taxes, Pensions, Reporting and
recordkeeping requirements.
26 CFR Part 301
Employment taxes, Estate taxes, Ex­
cise taxes, Gift taxes, Income taxes,
Penalties, Reporting and recordkeeping
requirements.
Adoption of Amendments to the
Regulations
Accordingly, 26 CFR parts 1, 53, 54,
and 301 are amended as follows:
PART 1-INCOME TAXES
Paragraph 1. The authority citation for
part 1 is amended by adding the following
entries in numerical order to read in part
as follows:
Authority: 26. U.S.C. 7805 * * *
* * * * *
Section 1.6033­4 also issued under 26
U.S.C. 6033.
* * * * *

Bulletin No. 2023–11 541 March 13, 2023
Section 1.6037­2 also issued under 26
U.S.C. 6037.
* * * * *
Par. 2. Section 1.1461­1 is amended by
removing paragraph (c)(5); redesignating
paragraph (i) as paragraph (j); adding a
new paragraph (i); and revising newly re­
designated paragraph (j).
The addition and revision read as
follows:
§1.1461-1 Payment and returns of tax
withheld.
* * * * *
(i) Reporting in electronic form. See
§§301.6011­2(b) and 301.6011­15 of
this chapter for the requirements of a
withholding agent that is not a financial
institution with respect to the filing of
Forms 1042­S and 1042 in electronic
form. See §301.1474­1(a) of this chap­
ter, which applies for purposes of this
section to a withholding agent that is a
financial institution with respect to the
filing of Forms 1042 and 1042­S in elec­
tronic form.
(j) Applicability date. The rules of this
section apply to returns required to be
filed for taxable years ending on or after
December 31, 2023. (For returns required
to be filed for taxable years ending before
December 31, 2023, see this section as in
effect and contained in 26 CFR part 1, as
revised April 1, 2022.)
Par. 3. Section 1.1471­0 is amended by
revising:
a. The entries in the table of contents
for §1.1474­1(e) and (j);
b. The heading for §301.1474­1; and
c. §301.1474­1(d)(1) and (e).
The revisions read as follows:
§1.1471-0 Outline of regulation
provisions for sections 1471 through
1474.
* * * * *
§1.1474-1 Liability for withheld tax and
withholding agent reporting.
* * * * *
(e) Reporting in electronic form.
* * * * *
(j) Applicability date.
* * * * *
§301.1474­1 Required use of electron­
ic form for financial institutions filing
Form 1042, Form 1042­S, or Form 8966.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
* * * * *
(e) Applicability date.
Par. 4. Section 1.1474­1 is amended by
revising paragraphs (e) and (j) to read as
follows:
§1.1474-1 Liability for withheld tax
and withholding agent reporting.
* * * * *
(e) Reporting in electronic form. See
§§301.6011­2(b) and 301.6011­15 of this
chapter, which apply for purposes of this
section, for the requirements of a with­
holding agent that is not a financial insti­
tution with respect to the filing of Forms
1042­S and Form 1042 in electronic form.
See §301.1474­1(a) of this chapter for the
requirements applicable to a withholding
agent that is a financial institution with
respect to the filing of Forms 1042 and
1042­S in electronic form.
* * * * *
(j) Applicability date. The rules of this
section apply to returns required to be
filed for taxable years ending on or after
December 31, 2023. (For returns required
to be filed for taxable years ending before
December 31, 2023, see this section as in
effect and contained in 26 CFR part 1, as
revised April 1, 2022.)
Par. 5. Section 1.6033­4 is revised to
read as follows:
§1.6033-4 Required filing in electronic
form for returns by organizations
required to file returns under section
6033.
(a) In general. The return of an or­
ganization that is required to be filed in
electronic form under §301.6033­4 of this
chapter must be filed in accordance with
IRS revenue procedures, publications,
forms, instructions, or other guidance.
(b) Applicability date. The rules of this
section apply for returns required to be
filed for taxable years ending on or after
February 23, 2023.
Par. 6. Section 1.6037­2 is revised to
read as follows:
§1.6037-2 Required use of electronic
form for income tax returns of electing
small business corporations.
(a) In general. The return of an electing
small business corporation that is required
to be filed electronically under §301.6037­
2 of this chapter must be filed in accor­
dance with IRS revenue procedures, pub­
lications, forms, or instructions, including
those posted electronically.
(b) Applicability date. The rules of this
section apply to returns required to be
filed for taxable years ending on or after
December 31, 2023.
Par. 7. Section 1.6045­2 is amended by
revising paragraphs (g)(2) and (i) to read
as follows:
§1.6045-2 Furnishing statement
required with respect to certain
substitute payments.
* * * * *
(g) * * *
(2) Reporting in electronic form.
For information returns filed after De­
cember 31, 1996, see §301.6011­2 of
this chapter for rules relating to filing
information returns in electronic form
and for rules relating to waivers granted
for undue hardship. A broker or barter
exchange that fails to file a Form 1099
electronically, when required, may be
subject to a penalty under section 6721
for each such failure. See paragraph (g)
(4) of this section.
* * * * *
(i) Applicability date. This section ap­
plies to substitute payments received by a
broker after December 31, 1984. Section
1.6045­2(c) (as contained in 26 CFR part
1, revised July 15, 2014) applies to payee
statements due after December 31, 2014.
For payee statements due before January
1, 2015, §1.6045­2(c) (as contained in 26
CFR part 1, revised April 2013) applies.
Paragraph (g)(2) of this section applies to
information returns required to be filed
during calendar years beginning after De­
cember 31, 2023.
Par. 8. Section 1.6045­4 is amended by
removing and reserving paragraph (k) and
revising paragraph (s).
The revision reads as follows:

March 13, 2023 542 Bulletin No. 2023–11
§1.6045-4 Information reporting on
real estate transactions with dates of
closing on or after January 1, 1991.
* * * * *
(s) Applicability date. This section ap­
plies for real estate transactions with dates
of closing (as determined under paragraph
(h)(2)(ii) of this section) that occur on or
after January 1, 1991. Section 1.6045­
4(b)(2)(i)(E), (b)(2)(ii), and (c)(2)(i) (as
contained in 26 CFR part 1, revised May
28, 2009) applies to sales or exchanges of
standing timber for lump­sum payments
completed after May 28, 2009. Section
1.6045­4(m)(1) (as contained in 26 CFR
part 1, revised July 15, 2014) applies to
payee statements due after December 31,
2014. For payee statements due before
January 1, 2015, §1.6045­4(m)(1) (as
contained in 26 CFR part 1, revised April
2013) applies. The removal of paragraph
(k) of this section applies for information
returns required to be filed during calendar
years beginning after December 31, 2023.
Par. 9. Section 1.6050I­0 is amended
by revising the entry in the table of con­
tents for §1.6050I­1(d)(2)(ii) to read as
follows:
§1.6050I-0 Table of contents.
* * * * *
§1.6050I­1 Returns relating to cash in
excess of $10,000 received in a trade or
business.
* * * * *
(d) * * *
(2) * * *
(ii) Casinos exempt under 31 CFR
1010.970(c).
* * * * *
Par. 10. Section 1.6050I­1 is amended
by:
a. Revising paragraphs (a)(3)(ii), (c)(1)
(iv), and (d)(2)(i) and (ii).
b. In paragraph (d)(2)(iv), redesignat­
ing the example as paragraph (d)(2)(iv)
(A).
c. Revising newly redesignated para­
graph (d)(2)(iv)(A) and adding a reserved
paragraph (d)(2)(iv)(B).
d. Revising paragraphs (e)(1) and (e)
(3)(i).
e. Adding paragraph (h).
The revisions and additions read as
follows:
§1.6050I-1 Returns relating to cash in
excess of $10,000 received in a trade or
business.
(a) * * *
(3) * * *
(ii) Exception. An agent who receives
cash from a principal and uses all of the
cash within 15 days in a cash transaction
(second cash transaction) which is report­
able under section 6050I or section 5331
of title 31 of the United States Code and
the corresponding regulations (31 CFR
Chapter X), and who discloses the name,
address, and taxpayer identification num­
ber of the principal to the recipient in the
second cash transaction need not report the
initial receipt of cash under this section.
* * * * *
(c) * * *
(1) * * *
(iv) Exception for certain loans. A ca­
shier’s check, bank draft, traveler’s check,
or money order received in a designated
reporting transaction is not treated as cash
pursuant to paragraph (c)(1)(ii)(B)(1) of
this section if the instrument constitutes
the proceeds of a loan from a bank (as that
term is defined in 31 CFR Chapter X).
* * * * *
(d) * * *
(2) * * *
(i) In general. If a casino receives cash
in excess of $10,000 and is required to
report the receipt of such cash directly to
the Department of the Treasury (Treasury
Department) under 31 CFR 1021.310 or
1010.360 and is subject to the recordkeep­
ing requirements of 31 CFR 1021.400,
then the casino is not required to make
a return with respect to the receipt of
such cash under section 6050I and these
regulations.
(ii) Casinos exempt under 31 CFR
1010.970(c). Under the authority of sec­
tion 6050I(c)(1)(A), the Secretary may
exempt from the reporting requirements
of section 6050I casinos with gross annual
gaming revenue in excess of $1,000,000
that are exempt under 31 CFR 1010.970(c)
from reporting certain cash transactions to
the Treasury Department under 31 CFR
1021.310 or 1010.360. The determination
whether a casino which is granted an ex­
emption under 31 CFR 1010.970(c) will
be required to report under section 6050I
will be made on a case­by­case basis,
concurrently with the granting of such an
exemption.
* * * * *
(iv) * * *
(A) Example. A and B are casinos having gross
annual gaming revenue in excess of $1,000,000. C
is a casino with gross annual gaming revenue of less
than $1,000,000. Casino A receives $15,000 in cash
from a customer with respect to a gaming transac­
tion which the casino reports to the Treasury Depart­
ment under 31 CFR 1021.310 and 1010.360. Casino
B’s hotel division receives $15,000 in cash from a
customer in payment for accommodations provided
to that customer at Casino B’s hotel. Casino C re­
ceives $15,000 in cash from a customer with respect
to a gaming transaction. Casino A is not required to
report the transaction under section 6050I or these
regulations because the exception for certain casinos
provided in paragraph (d)(2)(i) of this section (ca­
sino exception) applies. Casino B’s hotel division
is required to report under section 6050I and these
regulations because the casino exception does not
apply to the receipt of cash by a nongaming business
division. Casino C is required to report under sec­
tion 6050I and these regulations because the casino
exception does not apply to casinos having gross an­
nual gaming revenue of $1,000,000 or less which do
not have to report to the Treasury Department under
31 CFR 1021.310 and 1010.360.
(B) [Reserved]
* * * * *
(e) * * *
(1) Time of reporting. The reports re­
quired by this section must be filed in ac­
cordance with the Form 8300 instructions
and related publications by the 15th day
after the date the cash is received. Howev­
er, in the case of multiple payments relat­
ing to a single transaction (or two or more
related transactions), see paragraph (b) of
this section.
* * * * *
(3) * * *
(i) Where to file. A person making a re­
turn of information under this section must
file Form 8300 in accordance with the
form instructions and related publications.
* * * * *
(h) Applicability date. The rules of this
section apply for returns required to be
filed during calendar years beginning after
December 31, 2023.
Par. 11. Section 1.6050I­2 is amended
by revising paragraphs (c)(1)(i), (c)(3)(i),
and (f) to read as follows:
§1.6050I-2 Returns relating to cash in
excess of $10,000 received as bail by
court clerks.
* * * * *

Bulletin No. 2023–11 543 March 13, 2023
(c) * * *
(1) * * *
(i) In general. The information return
required by this section must be filed in
accordance with the Form 8300 instruc­
tions and related publications by the 15th
day after the date the cash bail is received.
* * * * *
(3) * * *
(i) Where to file. Returns required by
this section must be filed in accordance
with the Form 8300 instructions and relat­
ed publications. A copy of the information
return required to be filed under this sec­
tion must be retained for five years from
the date of filing.
* * * * *
(f) Applicability date. The rules of this
section apply for returns required to be
filed during calendar years beginning after
December 31, 2023.
Par. 12. Section 1.6050M­1 is amended
by revising paragraphs (d)(2) and (3) and
(f) to read as follows:
§1.6050M-1 Information returns
relating to persons receiving contracts
from certain Federal executive
agencies.
* * * * *
(d) * * *
(2) Form of reporting—(i) General
rule concerning electronic filing. The
information returns required by this sec­
tion with respect to contracts of a Fed­
eral executive agency for each calendar
quarter must be made in one submission
(or in multiple submissions if permitted
by paragraph (d)(4) of this section). Ex­
cept as provided in paragraph (d)(2)(ii)
of this section, the required returns must
be made in electronic form (within the
meaning of §301.6011­2(a)(1) of this
chapter) in accordance with any applica­
ble revenue procedure or other guidance
promulgated by the Internal Revenue
Service for the filing of such returns un­
der section 6050M.
(ii) Exceptions from electronic filing.
Any Federal executive agency that, on
October 1, has a reasonable expectation
of entering into, during the one­year
period beginning on that date, fewer
than 10 contracts subject to the report­
ing requirements under this section that
are to be filed during the calendar years
after 2023, may make the information
returns required by this section for each
quarter of that one­year period on the
prescribed paper Form 8596 in accor­
dance with the instructions accompany­
ing such form.
(iii) Exclusions from electronic-filing
requirements—(A) Waivers. The Com­
missioner may grant waivers of the re­
quirements of this section in cases of
undue hardship. One principal factor in
determining hardship will be the amount,
if any, by which the cost of filing the re­
turn electronically in accordance with this
section exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under paragraph
(a) of this section) and the period to which
it applies.
(B) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Place of filing—(i) Returns in elec-
tronic form. Information returns made un­
der this section in electronic form must be
filed with the Internal Revenue Service in
accordance with any applicable revenue
procedure or other guidance promulgated
by the Internal Revenue Service relating to
the filing of returns under section 6050M.
(ii) Form 8596. Information returns
made on paper Form 8596 must be filed
with the Internal Revenue Service at the
location specified in the instructions for
that form.
* * * * *
(f) Applicability date—(1) Contracts
required to be reported. Except as other­
wise provided in this paragraph (f), this
section applies to each Federal executive
agency with respect to its contracts en­
tered into on or after January 1, 1989 (in­
cluding any increase in amount obligated
on or after January 1, 1989, that is treated
as a new contract under paragraph (e) of
this section).
(2) Contracts not required to be re-
ported. A Federal executive agency is not
required to report—
(i) Any basic or initial contract entered
into before January 1, 1989,
(ii) Any increase contract action occur­
ring before January 1, 1989, that is treated
as a new contract under paragraph (e) of
this section, or
(iii) Any increase contract action that is
treated as a new contract under paragraph
(e) of this section if the basic or initial
contract to which that contract action re­
lates was entered into before January 1,
1989, and—
(A) The increase occurs before April 1,
1990, or
(B) The amount of the increase does
not exceed $50,000.
(3) Illustration. (i) If a Federal execu­
tive agency enters into an initial contract
on December 1, 1988, and the amount
of money obligated under the contract is
increased by $55,000 on April 15, 1990,
then there is no reporting requirement
with respect to the contract when entered
into on December 1, 1988. However, the
April 15, 1990, increase, which is treat­
ed as a new contract under paragraph (e)
of this section, is subject to the reporting
requirements of this section because it is
considered to be a new contract entered
into on April 15, 1990.
(ii) If the $55,000 increase had oc­
curred before April 1, 1990, there would
not have been a reporting requirement
with respect to that increase.
(4) Filing requirements for con-
tracts required to be reported. Section
1.6050M­1(d)(2) and (3) (as contained in
26 CFR part 1, revised February 23, 2023)
applies to information returns required to
be filed during calendar years beginning
after December 31, 2023.
PART 53—FOUNDATION AND
SIMILAR EXCISE TAXES
Par. 13. The authority citation for part
53 is amended by adding an entry in nu­
merical order to read in part as follows:
Authority: 26 U.S.C. 7805 * * *
Section 53.6011­1 also issued under 26
U.S.C. 6011.
* * * * *
Par. 14. Section 53.6011­1 is amended
by:

March 13, 2023 544 Bulletin No. 2023–11
a. Removing paragraph (c).
b. Redesignating paragraphs (d) and (e)
as paragraphs (c) and (d), respectively.
c. Adding a new paragraph (e).
The addition reads as follows:
§53.6011-1 General requirement of
return, statement or list.
* * * * *
(e) The rules of this section apply to
any returns required to be filed under this
section on or after January 11, 2021.
PART 54—PENSION EXCISE TAXES
Par. 15. The authority citation for part
54 is amended by adding an entry in nu­
merical order to read in part as follows:
Authority: 26 U.S.C. 7805 * * *
* * * * *
Section 54.6011­3 also issued under 26
U.S.C. 6011.
* * * * *
Par. 16. Section 54.6011­3 is added to
read as follows:
§54.6011-3 Required use of electronic
form for the filing requirements for the
return for certain excise taxes related
to employee benefit plans.
(a) Excise tax returns required in elec-
tronic form. Any employer or individual
required to file an excise tax return on
Form 5330, Return of Excise Taxes Re-
lated to Employee Benefit Plans, under
§54.6011­1 of this chapter must file the
excise tax return electronically if the filer
is required by the Internal Revenue Code
or regulations to file at least 10 returns of
any type during the calendar year that the
Form 5330 is due. The Commissioner may
direct the type of electronic filing and may
also exempt certain returns from the elec­
tronic­filing requirements of this section
through revenue procedures, publications,
forms, instructions, or other guidance, in­
cluding postings on the IRS.gov website.
Returns filed electronically must be made
in accordance with the applicable revenue
procedures, publications, forms, instruc­
tions, or other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under §54.6011­
1 of this chapter) and the period to which
it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If a filer required to
file the Form 5330 fails to file the report
electronically when required to do so by
this section, the filer has failed to file the
report. See generally section 6651(a)(1)
for the penalty for the failure to file a tax
return or to pay tax. For general rules re­
lating to the failure to file a tax return or to
pay tax, see the regulations under 26 CFR
301.6651­1 (Regulations on Procedure
and Administration).
(d) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
(2) Calculating the number of returns a
filer is required to file—(i) In general. For
purposes of this section, a filer is required
to file at least 10 returns during a calendar
year if the filer is required to file at least
10 returns of any type, including informa­
tion returns (for example, Forms W­2 and
Forms 1099), income tax returns, employ­
ment tax returns, and excise tax returns.
(ii) Definition of filer. For purposes of
this section, the term filer means the per­
son required to report the tax on the Form
5330. For general rules on who is required
to report the tax on the Form 5330, see the
Instructions to the Form 5330.
(e) Example. The following example
illustrates the provisions of paragraph (d)
(2) of this section:
(1) In 2023, Employer A (the plan sponsor and
plan administrator of Plan B) is required to file
Form 5330 for its nondeductible contribution under
section 4972 to Plan B. During the 2024 calendar
year, Employer A is required to file 20 returns (in­
cluding 19 Forms 1099­R Distributions From Pen-
sions, Annuities, Retirement, Profit-Sharing Plans,
IRAs, Insurance Contracts, etc., and one Form 5500
series, Annual Return/Report of the Employee Bene-
fit Plan). Plan B’s plan year is the calendar year. Be­
cause Employer A is required to file at least 10 returns
during the 2024 calendar year, Employer A must file
the 2023 Form 5330 for Plan B electronically.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to any Form 5330 required
to be filed for taxable years ending on or
after December 31, 2023.
PART 301—PROCEDURE AND
ADMINISTRATION
Par. 17. The authority citation for part
301 is amended by adding entries in nu­
merical order to read in part as follows:
Authority: 26 U.S.C. 7805.
* * * * *
Section 301.6011­10 also issued under
26 U.S.C. 6011.
Section 301.6011­11 also issued under
26 U.S.C. 6011.
Section 301.6011­12 also issued under
26. U.S.C. 6011.
Section 301.6011­13 also issued under
26 U.S.C. 6011.
Section 301.6011­14 also issued under
26 U.S.C. 6011.
Section 301.6011­15 also issued under
26 U.S.C. 6011.
Section 301.6012­2 also issued under
26 U.S.C. 6012.
* * * * *
Section 301.6057­3 also issued under
26 U.S.C. 6011 and 6057.
Section 301.6058­2 also issued under
26 U.S.C. 6011 and 6058.

Bulletin No. 2023–11 545 March 13, 2023
Section 301.6059­2 also issued under
26 U.S.C. 6011 and 6059.
* * * * *
Section 301.6721­1 also issued under
26 U.S.C. 6011 and 6721.
* * * * *
Par. 18. Section 301.1474­1 is amend­
ed by revising the section heading and
paragraphs (a) through (c), (d)(1), and (e)
to read as follows:
§301.1474-1 Required use of electronic
form for financial institutions filing
Form 1042, Form 1042-S, or Form
8966.
(a) Financial institutions filing cer-
tain returns. If a financial institution
is required to file a Form 1042, Annual
Withholding Tax Return for U.S. Source
Income of Foreign Persons, (or succes­
sor form) under §1.1474­1(c) of this
chapter, the financial institution must
file the return information required by
the applicable forms and schedules elec­
tronically. If a financial institution is
required to file a Form 1042­S, Foreign
Person’s U.S. Source Income Subject to
Withholding, (or such other form as the
IRS may prescribe) under §1.1474­1(d)
of this chapter, the financial institution
must file the information required by the
applicable forms and schedules electron­
ically. Additionally, if a financial institu­
tion is required to file Form 8966, FATCA
Report, (or such other form as the IRS
may prescribe) to report certain infor­
mation about U.S. accounts, substantial
U.S. owners of foreign entities, or own­
er­documented FFIs as required under
this chapter, the financial institution must
file the required information in electronic
form. Returns filed electronically must
be made in accordance with applicable
regulations, revenue procedures, publi­
cations, forms, instructions, and the IRS.
gov internet site. In prescribing regula­
tions, revenue procedures, publications,
forms, and instructions, including those
on the IRS.gov internet site, the Commis­
sioner may direct the type of electronic
filing.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Com­
missioner may grant waivers of the re­
quirements of this section in cases of
undue hardship. One principal factor in
determining hardship will be the amount,
if any, by which the cost of filing the re­
turn electronically in accordance with
this section exceeds the cost of filing the
return on paper. A request for a waiver
must be made in accordance with appli­
cable IRS revenue procedures, publica­
tions, forms, instructions, or other guid­
ance, including postings to the IRS.gov
website. The waiver request will specify
the type of filing (that is, a return required
under §1.1474­1(c) or (d) of this chapter,
or a Form 8966) and the period to which
it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If a financial institu­
tion fails to file a Form 1042 electronically
when required to do so by this section, the
financial institution has failed to file the
return. See section 6651 for the addition
to tax for failure to file a return. In deter­
mining whether there is reasonable cause
for failure to file the return, §301.6651­
1(c) and rules similar to the rules in
§301.6724­1(c)(3) (undue economic hard­
ship related to filing information returns
electronically) will apply. If a financial
institution fails to file a Form 1042­S or
a Form 8966 electronically when required
to do so by this section, the financial in­
stitution has failed to comply with the
information reporting requirements un­
der section 6721 of the Code. See section
6724(c) for failure to meet magnetic me­
dia requirements. In determining whether
there is reasonable cause for failure to
file the return, §301.6651­1(c) and rules
similar to the rules in §301.6724­1(c)(3)
(undue economic hardship related to filing
information returns on magnetic media)
will apply.
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(e) Applicability date. This section
applies to any Form 1042 (or successor
form) required to be filed for taxable years
ending on or after December 31, 2023.
This section applies to any Form 1042–S
or Form 8966 (or any other form that the
IRS may prescribe) filed with respect to
calendar years ending after December 31,
2013, except that paragraph (b)(2) of this
section only applies to Forms 1042­S or
Forms 8966 required to be filed for tax­
able years ending on or after December
31, 2023.
Par. 19. Section 301.6011­2 is amended
by revising the section heading and para­
graphs (a)(1), (b), (c), and (g) to read as
follows:
§301.6011-2 Required use of electronic
form.
(a) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures or publications, or, in the case of
returns filed with the Social Security Ad­
ministration, Social Security Administra­
tion publications. These generally include
electronic filing, as well as magnetic tape,
tape cartridge, diskette, and other media
specifically permitted under the applicable
regulations, procedures, or publications.
* * * * *
(b) Returns required electronically. (1)
If the use of Form 1042–S, Form 1094 se­
ries, Form 1095–B, Form 1095–C, Form
1097­BTC, Form 1098, Form 1098­C,
Form 1098–E, Form 1098­Q, Form 1098–
T, Form 1099 series, Form 3921, Form
3922, Form 5498 series, Form 8027, or
Form W–2G is required by the applicable
regulations or revenue procedures for the
purpose of making an information return,
the information required by the form must
be submitted electronically, except as oth­
erwise provided in paragraph (c) of this

March 13, 2023 546 Bulletin No. 2023–11
section. Returns filed electronically must
be made in accordance with applicable
revenue procedures, publications, forms,
or instructions.
(2) If the use of Form W–2 (Wage and
Tax Statement), Form 499R–2/W–2PR
(Withholding Statement (Puerto Rico)),
Form W–2VI (U.S. Virgin Islands Wage
and Tax Statement), Form W–2GU
(Guam Wage and Tax Statement), or Form
W–2AS (American Samoa Wage and Tax
Statement) is required for the purpose of
making an information return, the infor­
mation required by the form must be sub­
mitted electronically, except as otherwise
provided in paragraph (c) of this section.
Returns described in this paragraph (b)
(2) must be made in accordance with ap­
plicable Social Security Administration
procedures or publications (which may be
obtained from the local office of the Social
Security Administration).
(3) If a person is required to make a
return for the purpose of section 6050I,
and such person is required to file returns
described in paragraphs (b)(1) and (2) of
this section electronically, then such per­
son must also file the information required
by section 6050I electronically. Returns
described in this paragraph (b)(3) must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website, as well as
instructions and guidance on the FinCEN.
gov website.
(4) The Commissioner may exempt
certain returns from the electronic require­
ments of this section through revenue pro­
cedures, publications, forms, instructions,
or other guidance, including postings to
the IRS.gov website.
(c) Electronic-filing threshold—(1) In
general. No person is required to file in­
formation returns electronically in a cal­
endar year unless the person is required to
file at least 10 returns during that calendar
year. Persons required to file fewer than
10 returns during the calendar year may
make the returns on the prescribed pa­
per form or, alternatively, electronically
in accordance with paragraph (b) of this
section.
(2) Machine-readable forms. Returns
made on a paper form under paragraph (c)
(1) of this section must be machine­read­
able, as described in paragraph (a)(2) of
this section, if applicable revenue proce­
dures provide for a machine­readable pa­
per form.
(3) Special rule for partnerships. Not­
withstanding paragraph (c)(1) of this
section, a partnership with more than
100 partners is required to file its informa­
tion returns covered under paragraph (b)
of this section electronically.
(4) Calculating the number of returns—
(i) Aggregation of returns. In calculating
whether a person is required to file at least
10 returns under paragraph (c)(1) of this
section, all the information returns de­
scribed in paragraphs (b)(1) and (2) of this
section required to be filed during the cal­
endar year are counted in the aggregate.
Neither corrected information returns, in­
formation returns described in paragraph
(b)(3) of this section, nor returns other
than those described in paragraphs (b)(1)
and (2) of this section are taken into ac­
count in calculating whether a person is
required to file at least 10 returns.
(ii) Corrected returns. (A) If an orig­
inal information return covered by para­
graph (b) of this section is required to be
filed electronically, any corrected infor­
mation return corresponding to that origi­
nal return must also be filed electronically.
(B) If an original information return is
permitted to be filed on paper and is filed
on paper, any corrected information return
corresponding to that original return must
be filed on paper.
(5) Examples. The provisions of para­
graphs (c)(3) and (4) of this section are
illustrated by the following examples:
(i) Example 1. During the 2024 calendar year,
Company W, is required to file five Forms 1099­
INT, Interest Income, and five Forms 1099­DIV,
Dividends and Distributions, for a total of 10 re­
turns covered by paragraphs (b)(1) and (2) of this
section. Because Company W is required to file 10
returns as calculated under paragraph (c)(4) of this
section during the 2024 calendar year, Company W
must file all its 2023 Forms 1099­INT and 1099­DIV
electronically.
(ii) Example 2. Same facts as paragraph (c)(5)(i)
of this section (Example 1), except after electronical­
ly filing its 10 Forms 1099­DIV and 1099­INT, Com­
pany W files two corrected Forms 1099­DIV and
four corrected Forms 1099­INT. Because Company
W electronically filed its original 2023 Forms 1099­
DIV and 1099­INT, Company W must electron­
ically file its corrected 2023 Forms 1099­DIV and
1099­INT.
(iii) Example 3. Same facts as paragraph (c)(5)(i)
of this section (Example 1), except on May 16, 2024,
Company W received cash in excess of $10,000 and
must file a Form 8300 by May 31, 2024. Because
Company W is required to file information returns
covered under paragraphs (b)(1) and (2) of this sec­
tion electronically during the 2024 calendar year,
Company W must also file all its Forms 8300 elec­
tronically during the 2024 calendar year.
(iv) Example 4. Same facts as paragraph (c)(5)
(i) of this section (Example 1), except Company W
is not required to file any Forms 1099­INT during
calendar year 2024. On December 19, 2023, Com­
pany W receives cash in excess of $10,000 and
must file a Form 8300 by January 3, 2024. Because
Company W is not required to file information re­
turns covered under paragraphs (b)(1) and (2) of this
section electronically during the 2024 calendar year,
Company W is not required to file this Form 8300
electronically.
(v) Example 5. During the 2024 calendar year,
Partnership P, a partnership with 15 partners, is
required to file eight Forms 1099­MISC, Miscel-
laneous Information, and five Forms 1099­INT.
Because Partnership P is required to file at least 10
returns covered by paragraphs (b)(1) and (2) of this
section during the 2024 calendar year, Partnership
P must electronically file all its 2022 Forms 1099­
MISC and 1099­INT.
(6) Exclusions from electronic-filing
requirements—(i) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under paragraph
(b) of this section) and the period to which
it applies. For purposes of paragraph (b)
(3) of this section, a waiver granted for a
return under paragraph (b)(1) or (2) will
be deemed to have waived the electron­
ic­filing requirement for any returns re­
quired to be filed under section 6050I.
(ii) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effec­
tive and efficient tax administration. An
exemption will be allowed for filers for
whom using the technology required to
file in electronic form conflicts with their
religious beliefs. A submission claiming
an exemption must be made in accordance
with applicable IRS revenue procedures,
publications, forms, instructions, or other
guidance, including postings to the IRS.
gov website.

Bulletin No. 2023–11 547 March 13, 2023
(iii) Additional Exclusion. If an em­
ployer is required to make a final return
on Form 941, or a variation thereof, and
expedited filing of Forms W­2, Forms
499R­2/W­2PR, Forms W­2VI, Forms
W­2GU, or Form W­2AS is required, if
the IRS’s systems do not support electron­
ic filing, taxpayers will not be required to
file electronically (see §31.6071(a)­1(a)
(3)(ii) of this chapter).
* * * * *
(g) Applicability date. The rules of
this section apply to information returns
required to be filed during calendar years
beginning after December 31, 2023.
Par. 20. Section 301.6011­3 is amended
by:
a. Revising the section heading.
b. Revising paragraphs (a), (b), and (d)
(1).
c. Redesignating paragraph (d)(5) as
(d)(6) and adding new paragraph (d)(5).
d. Revising newly redesignated para­
graph (d)(6).
e. Revising paragraphs (e) and (f).
The revisions and addition read as
follows:
§301.6011-3 Required use of electronic
form for partnership returns.
(a) Partnership returns required elec-
tronically. (1) Except as otherwise pro­
vided in paragraph (b) of this section, a
partnership required to file a partnership
return pursuant to §1.6031(a)­1 of this
chapter, must file the information required
by the applicable forms and schedules
electronically, if
(i) the partnership is required by the In­
ternal Revenue Code or regulations to file
at least 10 returns (as described in para­
graph (d)(5) of this section) during the
calendar year ending with or within the
taxable year of the partnership, or
(ii) the partnership has more than 100
partners during the partnership’s taxable
year.
(2) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in accor­
dance with the applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, includ­
ing postings to the IRS.gov website. The
waiver request will specify the type of
filing (that is, a return required under
§1.6031(a)­1 of this chapter) and the pe­
riod to which it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effec­
tive and efficient tax administration. An
exemption will be allowed for filers for
whom using the technology required to
file in electronic form conflicts with their
religious beliefs. A submission claiming
an exemption must be made in accordance
with applicable IRS revenue procedures,
publications, forms, instructions, or other
guidance, including postings to the IRS.
gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(5) Calculating the number of returns.
For purposes of this section, a partnership
is required to file at least 10 returns if,
during the calendar year ending with or
within the taxable year of the partnership,
the partnership is required to file at least
10 returns of any type, including income
tax returns, employment tax returns, ex­
cise tax returns, and information returns
(for example, Forms W­2 and Forms 1099,
but not including schedules required to be
included with a partnership return). In the
case of a short­period return, a partner­
ship is required to file at least 10 returns
if, during the calendar year in which the
partnership’s short taxable year ends, the
partnership is required to file at least 10
returns of any type, including informa­
tion returns (for example, Forms W­2 and
Forms 1099, but not including schedules
required to be included with a partnership
return), income tax returns, employment
tax returns, and excise tax returns.
(6) Partnerships with more than 100
partners. A partnership has more than
100 partners if, over the course of the
partnership’s taxable year, the partnership
had more than 100 partners, regardless of
whether a partner was a partner for the
entire year or whether the partnership had
over 100 partners on any particular day in
the year. For purposes of this paragraph
(d)(6), however, only those persons hav­
ing a direct interest in the partnership must
be considered partners for purposes of de­
termining the number of partners during
the partnership’s taxable year.
(e) Examples. The following examples
illustrate the provisions of this section. In
the examples, the partnerships’ taxable
year is the calendar year 2023 and the
partnerships had fewer than 10 returns
required to be filed during calendar year
2023:
(1) Example 1. Partnership P had five general
partners and 90 limited partners on January 1, 2023.
On March 15, 2023, 10 more limited partners ac­
quired an interest in P. On September 29, 2023, the
10 newest partners sold their individual partnership
interests to C, a corporation which was one of the
original 90 limited partners. On December 31, 2023,
P had the same five general partners and 90 limited
partners it had on January 1, 2023. P had a total of
105 partners over the course of partnership taxable
year 2023. Therefore, P must file its 2023 partnership
return electronically.
(2) Example 2. Partnership Q is a general part­
nership that had 95 partners on January 1, 2023. On
March 15, 2023, 10 partners sold their individual
partnership interests to corporation D, which was
not previously a partner in Q. On September 29,
2023, corporation D sold one­half of its partner­
ship interest in equal shares to five individuals, who
were not previously partners in Q. On December
31, 2023, Q had a total of 91 partners, and on no
date in 2023 did Q have more than 100 partners.
Over the course of the year, however, Q had 101

March 13, 2023 548 Bulletin No. 2023–11
partners. Therefore, Q must file its 2023 partnership
return electronically.
(3) Example 3. Partnership G is a general part­
nership with 100 partners on January 1, 2023. There
are no new partners added to G in 2023. One of G’s
partners, A, is a partnership with 53 partners. A is one
partner, regardless of the number of partners A has.
Therefore, G has 100 partners and is not required to
file its 2023 partnership return electronically.
(4) Example 4. Same facts as paragraph (e)(3)
of this section (Example 3), except partnership G is
also required to file nine Forms 1099­MISC during
calendar year 2023 in addition to its 2022 partner­
ship return. Because partnership G is required to file
at least 10 returns of any type during calendar year
2023, partnership G must file its 2023 partnership
return electronically.
(f) Applicability date. The rules of this
section apply to partnership returns re­
quired to be filed during calendar years
beginning after December 31, 2023.
Par. 21. Section 301.6011­5 is amended
by revising the section heading, and para­
graphs (a), (b), (d)(1) and (5), (e), and (f)
to read as follows:
§301.6011-5 Required use of electronic
form for corporate income tax returns.
(a) Corporate income tax returns re-
quired electronically. (1) A corporation
required to file a corporate income tax
return on Form 1120, U.S. Corporation
Income Tax Return, under §1.6012­2 of
this chapter must file its corporate income
tax return electronically if the corporation
is required by the Internal Revenue Code
or regulations to file at least 10 returns (as
defined in paragraph (d)(5) of this section)
during the calendar year ending with or
within the taxable year of the corporation.
(2) All members of a controlled group
of corporations must file their corporate
income tax returns electronically if the
aggregate number of returns required to
be filed by the controlled group of corpo­
rations is at least 10 (as defined in para­
graph (d)(5) of this section) during the
calendar year ending with or within the
taxable year of the controlled group of
corporations.
(3) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in accor­
dance with the applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under §1.6012­2
of this chapter) and the period to which it
applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effec­
tive and efficient tax administration. An
exemption will be allowed for filers for
whom using the technology required to
file in electronic form conflicts with their
religious beliefs. A submission claiming
an exemption must be made in accordance
with applicable IRS revenue procedures,
publications, forms, instructions, or other
guidance, including postings to the IRS.
gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(5) Calculating the number of returns.
For purposes of this section, a corpora­
tion or controlled group of corporations
is required to file at least 10 returns if,
during the calendar year ending with or
within the taxable year of the corporation
or the controlled group, the corporation
or the controlled group is required to file
at least 10 returns of any type, including
information returns (for example, Forms
W­2 and Forms 1099), income tax returns,
employment tax returns, and excise tax re­
turns. In the case of a short­period return,
a corporation is required to file at least
10 returns if, during the calendar year in
which the corporation’s short taxable year
ends, the corporation is required to file
at least 10 returns of any type, including
information returns (for example, Forms
W­2 and Forms 1099), income tax returns,
employment tax returns, and excise tax re­
turns. If the corporation is a member of a
controlled group, calculating the number
of returns the corporation is required to
file includes all returns required to be filed
by all members of the controlled group
during the calendar year ending with or
within the taxable year of the controlled
group.
(e) Example. The following example
illustrates the provisions of this section:
(1) The taxable year of Corporation X, a fis­
cal­year taxpayer, ends on September 30. During
the calendar year ending December 31, 2023, X
was required to file one Form 1120, U.S. Corpora-
tion Income Tax Return, six Forms W­2, Wage and
Tax Statement, three Forms 1099­DIV, Dividends
and Distributions, one Form 940, Employer’s An-
nual Federal Unemployment (FUTA) Tax Return,
and four Forms 941, Employer’s Quarterly Federal
Tax Return. Because X is required to file 10 returns
of any type during calendar year 2023, the calendar
year that ended within its taxable year ending Sep­
tember 30, 2024, X is required to file its Form 1120
electronically for its taxable year ending Septem­
ber 30, 2024.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to corporate income tax re­
turns required to be filed during calendar
years beginning after December 31, 2023.
Par. 22. Section 301.6011­10 is added
to read as follows:
§301.6011-10 Certain organizations,
including trusts, required to file
unrelated business income tax returns
in electronic form.
(a) Unrelated business income tax re-
turns required in electronic form. (1) Or­
ganizations, including trusts, subject to
tax under section 511 that are required
to file a return under § 1.6012­2(e) or §
1.6012­3(a)(5) of this chapter to report

Bulletin No. 2023–11 549 March 13, 2023
gross income included in computing un­
related business taxable income, as de­
fined in section 512, or that are otherwise
required to file Form 990­T, Exempt Or-
ganization Business Income Tax Return
(and proxy tax under section 6033(e)),
are required to file that return in electron­
ic form.
(2) Returns filed in electronic form
must be filed in accordance with appli­
cable revenue procedures, publications,
forms, instructions, or other guidance.
(b) Failure to file. If an organization or
trust fails to file an unrelated business in­
come tax return in electronic form when
required to do so by this section, the or­
ganization or trust has failed to file the re­
turn. See section 6651 for the addition to
tax for failure to file a return. In determin­
ing whether there is reasonable cause for
failure to file the return, §301.6651­1(c)
will apply.
(c) Applicability date. The rules of this
section apply to unrelated business income
tax returns required to be filed during cal­
endar years beginning after February 23,
2023.
Par. 23. Section 301.6011­11 is added
to read as follows:
§301.6011-11 Required use of electronic
form for certain returns for tax-
advantaged bonds.
(a) Return for credit payments to is-
suers of qualified bonds. (1) An issuer of
a qualified bond required to file a return
for credit payments on Form 8038­CP,
Return for Credit Payments to Issuers of
Qualified Bonds, must file the return elec­
tronically if the issuer is required to file
at least 10 returns (as determined under
paragraph (d) of this section) during the
calendar year.
(2) Returns filed electronically must be
completed in accordance with applicable
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Com­
missioner may grant waivers of the re­
quirements of this section in cases of
undue hardship. One principal factor in
determining hardship will be the amount,
if any, by which the cost of filing the re­
turn electronically in accordance with this
section exceeds the cost of filing a paper
return. An issuer’s request for a waiver
must be submitted in accordance with ap­
plicable revenue procedures, publications,
forms, instructions, or other guidance, in­
cluding postings to the IRS.gov website.
The waiver request must specify the type
of filing (that is, the return required to be
filed electronically under this section), the
name of the issuer, the name of the bond
issue, the issue date of the tax­advantaged
bond (as defined in §1.150­1(b) of this
chapter), and any other information speci­
fied in the applicable revenue procedures,
publications, forms, instructions, or other
guidance, including postings to the IRS.
gov website.
(2) Exemptions. The Commissioner
may provide an exemption from the elec­
tronic­filing requirement of paragraph (a)
(1) of this section through revenue proce­
dures, publications, forms, instructions, or
other guidance, including postings to the
IRS.gov website, to promote effective and
efficient tax administration. A submission
claiming an exemption must be made in
accordance with applicable revenue pro­
cedures, publications, forms, instructions,
or other guidance, including postings to
the IRS.gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic filing,
taxpayers will not be required to file a re­
turn electronically under this section.
(c) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
(2) Qualified bond. The term qualified
bond means a tax­advantaged bond that is
a taxable bond that provides a refundable
Federal tax credit payable directly to the
issuer of the bond under former section
6431 or any other tax­advantaged bond
(as defined in §1.150­1(b) of this chap­
ter) that provides a refundable Federal tax
credit payment to an issuer of such bond.
(3) Return for credit payments to is-
suers of qualified bonds. The term return
for credit payments to issuers of qualified
bonds means a Form 8038­CP, Return for
Credit Payments to Issuers of Qualified
Bonds, or such other form prescribed by
the Commissioner for the purpose of filing
a return for credit payment with respect to
a qualified bond.
(d) Calculating the number of re-
turns—(1) Aggregation of returns. For
purposes of this section, an issuer of a
tax­advantaged bond is required to file
at least 10 returns if, during the calendar
year, the issuer is required to file at least
10 returns of any type, including informa­
tion returns (for example, Forms W­2 and
Forms 1099), income tax returns, employ­
ment tax returns, and excise tax returns.
(2) Corrected returns. (i) If an original
return covered by this section is required
to be filed electronically, any corrected re­
turn corresponding to that original return
must also be filed electronically.
(ii) If an original return covered by this
section is permitted to be filed on paper
and is filed on paper, any corrected return
corresponding to that original return must
be filed on paper.
(e) Applicability date. The rules of this
section apply to returns for tax­advantaged
bonds filed after December 31, 2023.
Par. 24. Section 301.6011­12 is added
to read as follows:
§301.6011-12 Required use of
electronic form for returns of certain
excise taxes under Chapters 41 and 42
of the Internal Revenue Code.
(a) Excise tax returns required electron-
ically. (1) Any person required to file an
excise tax return on Form 4720, Return of
Certain Excise Taxes Under Chapters 41
and 42 of the Internal Revenue Code, un­
der §53.6011­1 of this chapter must file
its excise tax return electronically if the
person is required by the Internal Revenue
Code or regulations to file at least 10 re­
turns (as defined in paragraph (d)(3) of
this section) during the calendar year.
(2) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including

March 13, 2023 550 Bulletin No. 2023–11
postings on the IRS.gov website. Returns
filed electronically must be made in accor­
dance with the applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(3) Paragraph (a)(1) of this section is
not applicable to private foundations that
are subject to the filing requirements of
§301.6033­4.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under §53.6011­
1 of this chapter) and the period to which
it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If a person fails to file
an excise tax return electronically when
required to do so by this section, the per­
son has failed to file the return. See section
6651 for the addition to tax for failure to
file a return. In determining whether there
is reasonable cause for failure to file the
return, §301.6651­1(c) and rules similar
to the rules in §301.6724­1(c)(3) (undue
economic hardship related to filing infor­
mation returns electronically) will apply.
(d) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as magnet­
ic tape, tape cartridge, diskette, and other
media specifically permitted under the ap­
plicable regulations, procedures, publica­
tions, forms, instructions, or other guidance.
(2) Excise tax return. The term excise
tax return means a Form 4720, Return
of Certain Excise Taxes Under Chapters
41 and 42 of the Internal Revenue Code,
along with all other related forms, sched­
ules, and statements that are required to
be attached to the Form 4720, including
amended and superseding returns.
(3) Calculating the number of returns.
For purposes of this section, a person is re­
quired to file at least 10 returns if, during
the calendar year ending with or within
the person’s taxable year, the person is re­
quired to file at least 10 returns of any type,
including information returns (for example,
Forms W­2 and Forms 1099), income tax
returns, employment tax returns, and ex­
cise tax returns. In the case of a short­peri­
od return, a person is required to file at least
10 returns if, during the calendar year in
which the person’s short taxable year ends,
the person is required to file at least 10 re­
turns of any type, including information re­
turns (for example, Forms W­2 and Forms
1099), income tax returns, employment tax
returns, and excise tax returns.
(e) Example. The following example
illustrates the provisions of this section:
(1) During the calendar year ending December
31, 2023, Trust X was required to file one Form
4720, Return of Certain Excise Taxes Under Chap-
ters 41 and 42 of the Internal Revenue Code, which
related to the 2022 taxable year, and 10 Forms W­2,
Wage and Tax Statement, which reported wages paid
to employees during 2022. Because X is required to
file 11 returns during calendar year 2023, X is re­
quired to file its Form 4720 electronically for its tax­
able year ended December 31, 2023.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to excise tax returns re­
quired to be filed for taxable years ending
on or after December 31, 2023.
Par. 25. Section 301.6011­13 is added
to read as follows:
§301.6011-13 Required use of
electronic form for split-interest trust
returns.
(a) Split-interest trust returns required
electronically. (1) Any trust required to
file an information return on Form 5227,
Split-Interest Trust Information Return,
under §53.6011­1 of this chapter must
file its return electronically if the trust is
required by the Internal Revenue Code or
regulations to file at least 10 returns (as
defined in paragraph (d)(3) of this section)
during the calendar year.
(2) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in ac­
cordance with applicable revenue proce­
dures, publications, forms, or instructions.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under §53.6011­
1 of this chapter) and the period to which
it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If a trust fails to file
an excise tax return electronically when
required to do so by this section, the trust
has failed to file the return. See section
6652 for the addition to tax for failure to
file a return. In determining whether there
is reasonable cause for failure to file the
return, §301.6652­1(f) and rules similar

Bulletin No. 2023–11 551 March 13, 2023
to the rules in §301.6724­1(c)(3) (undue
economic hardship related to filing infor­
mation returns electronically) will apply.
(d) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
(2) Split-Interest Trust return. The
term split-interest trust return means a
Form 5227, Split-Interest Trust Informa-
tion Return, along with all other relat­
ed forms, schedules, and statements that
are required to be attached to the Form
5227, including amended and superseding
returns.
(3) Calculating the number of returns.
For purposes of this section, a trust is re­
quired to file at least 10 returns if, during
the calendar year ending with or within the
trust’s taxable year, the trust is required
to file at least 10 returns of any type, in­
cluding information returns (for example,
Forms W­2 and Forms 1099), income tax
returns, employment tax returns, and ex­
cise tax returns. In the case of a short­peri­
od return, a trust is required to file at least
10 returns if, during the calendar year in
which the trust’s short taxable year ends,
the trust is required to file at least 10 re­
turns of any type, including information
returns (for example, Forms W­2 and
Forms 1099), income tax returns, employ­
ment tax returns, and excise tax returns.
(e) Example. The following example
illustrates the provisions of this section:
(1) During the calendar year ending December
31, 2023, Trust X was required to file one Form
5227, Split-Interest Trust Information Return, one
Form 4720, Return of Certain Excise Taxes Under
Chapters 41 and 42 of the Internal Revenue Code,
and 10 Forms 1099­DIV, Dividends and Distribu-
tions. Because X is required to file 12 returns during
the calendar year 2023, X is required to file its Form
5227 electronically for its taxable year ending De­
cember 31, 2023.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to Split­Interest Trust re­
turns required to be filed for taxable years
ending on or after December 31, 2023.
Par. 26. Section 301.6011­14 is added
to read as follows:
§301.6011-14 Required use of
electronic form or other machine-
readable form for material advisor
disclosure statements.
(a) Material advisor disclosure state-
ments required electronically or in other
machine-readable form. (1) Any mate­
rial advisor required to file a return on
Form 8918, Material Advisor Disclosure
Statement, under §301.6111­3(a) of this
chapter must file its return electronical­
ly or in other machine­readable form,
in accordance with revenue procedures,
publications, forms, instructions, or other
guidance, including postings on the IRS.
gov website, if the material advisor is re­
quired by the Internal Revenue Code or
regulations to file at least 10 returns (as
determined under paragraph (d)(4) of this
section) during the calendar year.
(2) The Commissioner may direct the
type of electronic or other machine­read­
able form through revenue procedures,
publications, forms, instructions, or other
guidance, including postings on the IRS.
gov website. Returns filed electronically
or in other machine­readable form must
be made in accordance with applicable
revenue procedures, publications, forms,
instructions, or other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, includ­
ing postings to the IRS.gov website. The
waiver request will specify the type of
filing (that is, a return required under
§301.6111­3(a) of this chapter) and the
period to which it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If a material advi­
sor fails to file Form 8918 electronically
or in other machine­readable form when
required to do so by this section, the ma­
terial advisor has failed to file the return.
See section 6707 for the penalty for failure
to file the return.
(d) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
(2) Machine-readable form. The term
machine-readable form means any ma­
chine­readable form specifically permit­
ted under applicable regulations, proce­
dures, publications, forms, instructions, or
other guidance.
(3) Material advisor disclosure state-
ment. The term material advisor disclo-
sure statement means a Form 8918, Mate-
rial Advisor Disclosure Statement, along
with all other related forms, schedules, and
statements that are required to be attached
to the Form 8918, including amended ma­
terial advisor disclosure statements.
(4) Calculating the number of returns. (i)
Except as provided in paragraph (d)(4)(ii)
of this section, for purposes of this section,
a material advisor is required to file at least
10 returns if during the calendar year the
material advisor is required to file at least
10 returns of any type, including informa­
tion returns (for example, Forms W­2 and
Forms 1099), income tax returns, employ­
ment tax returns, and excise tax returns.
(ii) Form 8918 is not taken into account
in calculating whether a material advisor

March 13, 2023 552 Bulletin No. 2023–11
is required to file at least 10 returns during
a calendar year.
(e) Example. The following example
illustrates the provisions of this section:
(1) During the calendar year ending December
31, 2024, Material Advisor X was required to file one
Form 1040, U.S. Individual Income Tax Return, and
10 Forms 1099­NEC, Nonemployee Compensation.
Because Material Advisor X is required to file 11 re­
turns during the calendar year 2024, X is required
to file its Forms 8918 electronically or in other ma­
chine­readable form, in accordance with revenue
procedures, publications, forms, instructions, or
other guidance, including postings on the IRS.gov
website, during the calendar year ending December
31, 2024.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to Material Advisor Disclo­
sure Statements required to be filed after
December 31, 2023.
Par. 27. Section 301.6011­15 is added
to read as follows:
§301.6011-15 Required use of
electronic form for withholding tax
returns.
(a) Withholding tax returns required
electronically. (1) A withholding agent
required to file an income tax return on
Form 1042, Annual Withholding Tax Re-
turn for U.S. Source Income of Foreign
Persons, under §1.1461­1(b) of this chap­
ter must file its return electronically if the
withholding agent is required by the Inter­
nal Revenue Code or regulations to file at
least 10 returns (as defined in paragraph
(d)(5) of this section) during the calendar
year in which the Form 1042 is required
to be filed. Notwithstanding the previous
sentence, a withholding agent that is an
individual, estate, or trust is not required
to file its Form 1042 electronically.
(2) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in accor­
dance with the applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under §1.1461­1
of this chapter) and the period to which it
applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If a withholding
agent fails to file a withholding tax re­
turn electronically when required to do
so by this section, the withholding agent
has failed to file the return. See section
6651 for the addition to tax for failure to
file a return. In determining whether there
is reasonable cause for failure to file the
return, §301.6651­1(c) and rules similar
to the rules in §301.6724­1(c)(3) (undue
economic hardship related to filing infor­
mation returns electronically) will apply.
(d) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, and diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, or instructions.
(2) Withholding agent. The term with-
holding agent means a withholding agent
as defined in §1.1441­7(a) of this chapter.
(3) Withholding tax return. The term
withholding tax return means a Form
1042, Annual Withholding Tax Return for
U.S. Source Income of Foreign Persons,
along with all other related forms, sched­
ules, and statements that are required to
be attached to the Form 1042, including
amended and superseding returns.
(4) Special rule for partnerships. Not­
withstanding paragraph (d)(5) of this sec­
tion, a withholding agent that is a part­
nership with more than 100 partners (as
determined under §301.6011­3(d)(6)) is
required to file a return described in para­
graph (a) of this section electronically.
(5) Calculating the number of returns.
For purposes of this section, a withhold­
ing agent is required to file at least 10 re­
turns if, during the calendar year in which
the Form 1042 is required to be filed,
the withholding agent is required to file
at least 10 returns of any type, including
information returns (for example, Forms
W­2, Forms 1099, Forms 1042­S), income
tax returns (for example, Form 1042),
employment tax returns, and excise tax
returns.
(e) Special rule for returns filed by fi-
nancial institutions. For rules that require
withholding agents that are financial in­
stitutions to file returns electronically, see
§301.1474­1.
(f) Applicability date. The rules of this
section apply to withholding tax returns
required to be filed for taxable years end­
ing on or after December 31, 2023.
Par. 28. Section 301.6012­2 is added to
read as follows:
§301.6012-2 Required use of electronic
form for income tax returns of certain
political organizations.
(a) Income tax returns of certain polit-
ical organizations required electronically.
(1) Any organization required to file an
income tax return on Form 1120­POL,
U.S. Income Tax Return for Certain Po-
litical Organizations, under §1.6012­6 of
this chapter must file its income tax return,
along with all other related forms, sched­
ules, and statements that are required to be
attached to the Form 1120­POL, including
amended and superseding returns, elec­
tronically if the organization is required
by the Internal Revenue Code or regula­
tions to file at least 10 returns of any type
(as defined in paragraph (d)(2) of this sec­
tion) during the calendar year.

Bulletin No. 2023–11 553 March 13, 2023
(2) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in accor­
dance with the applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a return required under §1.6012­6
of this chapter) and the period to which it
applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
(c) Failure to file. If an organization
fails to file an income tax return electron­
ically when required to do so by this sec­
tion, the organization has failed to file the
return. See section 6651 for the addition to
tax for failure to file a return. In determin­
ing whether there is reasonable cause for
failure to file the return, §301.6651­1(c)
and rules similar to the rules in §301.6724­
1(c)(3) (undue economic hardship related
to filing information returns electronical­
ly) will apply.
(d) Meaning of terms. The follow­
ing definitions apply for purposes of this
section:
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
(2) Income tax return for certain po-
litical organizations. The term income
tax return for certain political organi-
zations means a Form 1120­POL, U.S.
Income Tax Return for Certain Political
Organizations, along with all other relat­
ed forms, schedules, and statements that
are required to be attached to the Form
1120­POL, including amended and su­
perseding returns.
(3) Calculating the number of returns.
For purposes of this section, an organiza­
tion is required to file at least 10 returns
if, during the calendar year ending with
or within the organization’s taxable year,
the organization is required to file at least
10 returns of any type, including infor­
mation returns (for example, Forms W­2
and Forms 1099), income tax returns,
employment tax returns, and excise tax
returns. In the case of a short­period re­
turn, an organization is required to file
at least 10 returns if, during the calendar
year in which the organization’s short
taxable year ends, the organization is re­
quired to file at least 10 returns of any
type, including information returns (for
example, Forms W­2 and Forms 1099),
income tax returns, employment tax re­
turns, and excise tax returns.
(e) Example. The following example
illustrates the provisions of this section:
(1) During the calendar year ending December
31, 2023, Organization X was required to file one
Form 1120­POL, U.S. Income Tax Return for Cer-
tain Political Organizations, four (quarterly) Forms
8872, Political Organization Report of Contribu-
tions and Expenditures, two Forms W­2, Wage and
Tax Statement, one Form 940, Employer’s Annual
Federal Unemployment (FUTA) Tax Return, and
four Forms 941, Employer’s Quarterly Federal
Tax Return. Because X is required to file 12 returns
during the calendar year, X is required to file its
Form 1120­POL electronically for its taxable year
ending December 31, 2023.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to income tax returns re­
quired to be filed for taxable years ending
on or after December 31, 2023.
Par. 29. Section 301.6033­4 is revised
to read as follows:
§301.6033-4 Required filing in
electronic form for returns by
organizations required to file returns
under section 6033.
(a) Returns by organizations required
to file returns under section 6033 in elec-
tronic form. (1) An organization required
to file a return under section 6033 must
file its return in electronic form.
(2) Returns filed in electronic form
must be filed in accordance with appli­
cable revenue procedures, publications,
forms, instructions, or other guidance.
(b) Failure to file. If an organization
required to file a return under section
6033 fails to file an information return in
electronic form when required to do so by
this section, the organization has failed to
file the return. See section 6652 for the
addition to tax for failure to file a return.
In determining whether there is reason­
able cause for failure to file the return,
§301.6652­2(f) will apply.
(c) Meaning of terms. For purposes
of this section the term return required
under section 6033 means a Form 990,
Return of Organization Exempt From
Income Tax; Form 990­EZ, Short Form
Return of Organization Exempt From In-
come Tax; and Form 990­PF, Return of
Private Foundation or Section 4947(a)
(1) Trust Treated as Private Foundation,
along with all other related forms, sched­
ules, and statements that are required to
be attached to the Form 990, Form 990­
EZ, or Form 990­PF, and all members of
the Form 990 series of returns, includ­
ing amended and superseding returns. A
Form 4720 filed by a private foundation
is a form required to be filed under sec­
tion 6033.
(d) Applicability date. The rules of this
section apply to any returns under sec­
tion 6033 required to be filed during cal­
endar years beginning after February 23,
2023.
Par. 30. Section 301.6037­2 is amend­
ed by revising the section heading and
paragraphs (a), (b), (d)(1) and (5), (e), and
(f) to read as follows:

March 13, 2023 554 Bulletin No. 2023–11
§301.6037-2 Required use of electronic
form for returns of electing small
business corporation.
(a) Returns of electing small business
corporation required electronically. (1)
An electing small business corporation
required to file an electing small busi­
ness return on Form 1120­S, U.S. Income
Tax Return for an S Corporation, under
§1.6037­1 of this chapter must file its
Form 1120­S electronically if the small
business corporation is required by the
Internal Revenue Code and regulations to
file at least 10 returns during the calendar
year.
(2) The Commissioner may direct the
type of electronic filing and may also ex­
empt certain returns from the electronic
requirements of this section through rev­
enue procedures, publications, forms, in­
structions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in accor­
dance with the applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, includ­
ing postings to the IRS.gov website. The
waiver request will specify the type of fil­
ing (that is, a return required under section
6037) and the period to which it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effec­
tive and efficient tax administration. An
exemption will be allowed for filers for
whom using the technology required to
file in electronic form conflicts with their
religious beliefs. A submission claiming
an exemption must be made in accordance
with applicable IRS revenue procedures,
publications, forms, instructions, or other
guidance, including postings to the IRS.
gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(5) Calculating the number of re-
turns. For purposes of this section, a cor­
poration is required to file at least 10 re­
turns if, during the calendar year ending
with or within the corporation’s taxable
year, the corporation is required to file
at least 10 returns of any type, includ­
ing income tax returns, employment tax
returns, excise tax returns, and informa­
tion returns (for example, Forms W–2,
Forms 1099, but not including schedules
required to be attached to an S corpora­
tion return). In the case of a short­pe­
riod return, a corporation is required
to file at least 10 returns if, during the
calendar year in which the corporation’s
short taxable year ends, the corporation
is required to file at least 10 returns of
any type, including information returns
(for example, Forms W–2, Forms 1099,
but not including schedules required to
be attached to an S corporation return),
income tax returns, employment tax re­
turns, and excise tax returns.
(e) Example. The following example
illustrates the provisions of this section.
In the example, the corporation is a calen­
dar­year taxpayer.
(1) In 2023, Corporation S, an electing small
business corporation, is required to file one 2022
Form 1120­S, U.S. Income Tax Return for an S Cor-
poration, two Forms W–2, Wage and Tax Statement,
two Forms 1099–DIV, Dividends and Distributions,
one Form 940, Employer’s Annual Federal Unem-
ployment (FUTA) Tax Return, and four Forms 941,
Employer’s Quarterly Federal Tax Return. Because
S is required to file 10 returns during the calendar
year 2023, S is required to file its 2023 Form 1120­S
electronically.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to electing small business
corporation returns required to be filed
during calendar years beginning after De­
cember 31, 2023.
Par. 31. Section 301.6057­3 is amend­
ed by:
a. Revising the section heading.
b. Revising paragraphs (a), (b), and (d)
(1).
c. Revising the heading of paragraph
(d)(4) and revising paragraph (d)(4)(i).
d. In paragraph (e), redesignating the
example as paragraph (e)(1).
e. Revising newly redesignated para­
graph (e)(1).
f. Adding a reserved paragraph (e)(2).
g. Revising paragraph (f).
The revisions and addition read as
follows:
§301.6057-3 Required use of electronic
form for filing requirements relating to
deferred vested retirement benefit.
(a) Electronic-filing requirements un-
der section 6057. A registration statement
required under section 6057(a) or a noti­
fication required under section 6057(b)
with respect to an employee benefit plan
must be filed electronically if the filer is
required by the Internal Revenue Code or
regulations to file at least 10 returns during
the calendar year that includes the first day
of the plan year. The Commissioner may
direct the type of electronic filing and may
also exempt certain returns from the elec­
tronic requirements of this section through
revenue procedures, publications, forms,
instructions, or other guidance, including
postings on the IRS.gov website. Returns
filed electronically must be made in ac­
cordance with applicable revenue proce­
dures, publications, forms, instructions, or
other guidance.
(b) Exclusions from electronic-filing
requirements—(1) Waivers. The Commis­
sioner may grant waivers of the require­
ments of this section in cases of undue
hardship. One principal factor in deter­
mining hardship will be the amount, if
any, by which the cost of filing the return
electronically in accordance with this sec­
tion exceeds the cost of filing the return
on paper. A request for a waiver must be
made in accordance with applicable IRS
revenue procedures, publications, forms,

Bulletin No. 2023–11 555 March 13, 2023
instructions, or other guidance, including
postings to the IRS.gov website. The waiv­
er request will specify the type of filing
(that is, a registration statement or notifi­
cation under section 6057) and the period
to which it applies.
(2) Exemptions. The Commissioner
may provide exemptions from the require­
ments of this section to promote effective
and efficient tax administration. A sub­
mission claiming an exemption must be
made in accordance with applicable IRS
revenue procedures, publications, forms,
instructions, or other guidance, including
postings to the IRS.gov website.
(3) Additional Exclusion. If the IRS’s
systems do not support electronic fil­
ing, taxpayers will not be required to file
electronically.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(4) Calculating the number of re-
turns—(i) In general. For purposes of this
section, a filer is required to file at least
10 returns if, during the calendar year that
includes the first day of the plan year, the
filer is required to file at least 10 returns
of any type, including information re­
turns (for example, Forms W­2 and Forms
1099), income tax returns, employment
tax returns, and excise tax returns.
* * * * *
(e) * * *
(1) Example. In 2024, P, the plan administrator of
Plan B, is required to file 12 returns (including Forms
1099­R, Distributions From Pensions, Annuities,
Retirement or Profit-Sharing Plans, IRAs, Insur-
ance Contracts, etc.; Form 8955­SSA; Form 5500,
Annual Return/Report of Employee Benefit Plan;
and Form 945, Annual Return of Withheld Federal
Income Tax). Plan B’s plan year is the calendar year.
Because P is required to file at least 10 returns during
the 2024 calendar year, P must file the 2024 Form
8955­SSA for Plan B electronically.
(2) [Reserved]
(f) Applicability date. The rules of this
section apply to registration statements
and other notifications required to be filed
under section 6057 for plan years that be­
gin on or after January 1, 2024.
Par. 32. Section 301.6058­2 is amend­
ed by:
a. Revising the section heading.
b. Revising paragraphs (a), (b), and (d)
(1).
c. Revising the heading of paragraph
(d)(3).
d. Revising paragraphs (d)(3)(i) and
(iii), (e), and (f).
The revisions read as follows:
§301.6058-2 Required use of electronic
form for filing requirements relating
to information required in connection
with certain plans of deferred
compensation.
(a) Electronic-filing requirements un-
der section 6058. A return required under
section 6058 with respect to an employee
benefit plan must be filed electronically if
the filer is required by the Internal Rev­
enue Code or regulations to file at least
10 returns during the calendar year that
includes the first day of the plan year. The
Commissioner may direct the type of elec­
tronic filing and may also exempt certain
returns from the electronic requirements
of this section through revenue proce­
dures, publications, forms, instructions,
or other guidance, including postings on
the IRS.gov website. Returns filed elec­
tronically must be made in accordance
with the applicable revenue procedures,
publications, forms, instructions, or other
guidance.
(b) Undue hardship. The Commission­
er may waive the requirements of this sec­
tion in cases of undue economic hardship.
One principal factor in determining hard­
ship will be the amount, if any, by which
the cost of filing the return electronically
in accordance with this section exceeds
the cost of filing the return on paper. A re­
quest for a waiver must be made in accor­
dance with applicable IRS revenue proce­
dures, publications, forms, instructions, or
other guidance, including postings to the
IRS.gov website. The waiver request will
specify the type of filing (that is, a return
required under section 6058) and the peri­
od to which it applies.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(3) Calculating the number of returns—
(i) In general. For purposes of this section,
a filer is required to file at least 10 returns
if, during the calendar year that includes
the first day of the plan year, the filer is
required to file at least 10 returns of any
type, including information returns (for
example, Forms W­2 and Forms 1099), in­
come tax returns, employment tax returns,
and excise tax returns. See section 6011(e)
(6), Application of numerical limitation to
returns relating to deferred compensation
plans.
* * * * *
(iii) Special rules relating to calculat-
ing the number of returns. For purposes
of applying paragraph (d)(3)(ii) of this
section, the aggregation rules of sec­
tion 414(b), (c), (m), and (o) will apply
to a filer that is or includes an employer.
Thus, for example, a filer that is a mem­
ber of a controlled group of corporations
within the meaning of section 414(b)
must file the Form 5500 series electron­
ically if the aggregate number of returns
required to be filed by all members of the
controlled group of corporations is at least
10 returns.
(e) Example. The following example
illustrates the provisions of paragraph (d)
(3) of this section:
(1) In 2024, Employer X (the plan sponsor and
plan administrator of Plan A) is required to file 12
returns. The sole shareholder of X and his spouse
are the only participants in Plan A. Employer X is
required to file the following: one Form 1120, U.S.
Corporation Income Tax Return; two Forms W­2,
Wage and Tax Statement; one Form 940, Employer’s
Annual Federal Unemployment (FUTA) Tax Return;
four Forms 941, Employer’s Quarterly Federal Tax
Return; one Form 945, Annual Return of Withheld
Federal Income Tax; and two Forms 1099­DIV, Div-
idends and Distributions. Employer X is required to
file one Form 5500­EZ. Plan A’s plan year is the cal­
endar year. Because Employer X is required to file
at least 10 returns during the 2024 calendar year, the
2024 Form 5500­EZ must be filed electronically.
(2) [Reserved]

March 13, 2023 556 Bulletin No. 2023–11
(f) Applicability date. This section is
applicable for returns required to be filed
under section 6058 for plan years that be­
gin on or after January 1, 2024.
Par. 33. Section 301.6059­2 is amend­
ed by:
a. Revising the section heading.
b. Revising paragraphs (a), (b), and (d)
(1).
c. Revising the heading for paragraph
(d)(3) and revising paragraph (d)(3)(i).
d. Removing paragraph (e) and redes­
ignating paragraph (f) as paragraph (e).
e. Revising newly redesignated para­
graph (e).
The revisions read as follows:
§301.6059-2 Required use of electronic
form for filing requirements relating to
periodic report of actuary.
(a) Electronic-filing requirements un-
der section 6059. An actuarial report re­
quired under section 6059 with respect
to an employee benefit plan must be filed
electronically if the filer is required by the
Internal Revenue Code or regulations to
file at least 10 returns during the calen­
dar year that includes the first day of the
plan year. The Commissioner may direct
the type of electronic filing and may also
exempt certain returns from the electron­
ic requirements of this section through
revenue procedures, publications, forms,
instructions, or other guidance, including
postings on the IRS.gov website. Actuarial
reports filed electronically must be made
in accordance with the applicable revenue
procedures, publications, forms, instruc­
tions, or other guidance.
(b) Undue hardship. The Commission­
er may waive the requirements of this sec­
tion in cases of undue economic hardship.
One principal factor in determining hard­
ship will be the amount, if any, by which
the cost of filing the reports electronically
in accordance with this section exceeds
the cost of filing the return on paper. A re­
quest for a waiver must be made in accor­
dance with applicable IRS revenue proce­
dures, publications, forms, instructions, or
other guidance, including postings to the
IRS.gov website. The waiver request will
specify the type of filing (that is, an actu­
arial report required under 6059) and the
period to which it applies.
* * * * *
(d) * * *
(1) Magnetic media or electronic form.
The terms magnetic media or electronic
form mean any media or form permitted
under applicable regulations, revenue pro­
cedures, or publications. These generally
include electronic filing, as well as mag­
netic tape, tape cartridge, diskette, and
other media specifically permitted under
the applicable regulations, procedures,
publications, forms, instructions, or other
guidance.
* * * * *
(3) Calculating the number of re-
turns—(i) In general. For purposes of
this section, a filer is required to file at
least 10 returns if, during the calendar
year that includes the first day of the plan
year, the filer is required to file at least
10 returns of any type, including infor­
mation returns (or example, Forms W­2
and Forms 1099), income tax returns,
employment tax returns, and excise tax
returns.
* * * * *
(e) Applicability date. This section is
applicable for actuarial reports required to
be filed under section 6059 for plan years
that begin on or after January 1, 2024.
Par. 34. Section 301.6721­1 is amend­
ed by:
a. Revising paragraphs (a)(2)(ii) and
(b)(5) introductory text.
b. Redesignating Examples 1 through 4
in paragraph (d)(5) as paragraphs (b)(5)
(i) through (iv).
c. Revising newly designated para­
graphs (b)(5)(iii) and (iv).
d. Adding paragraphs (b)(5)(v) and (vi)
and (h).
The revisions and additions read as
follows:
§301.6721-1 Failure to file correct
information returns.
(a) * * *
(2) * * *
(ii) A failure to include all the informa­
tion required to be shown on the return or
including incorrect information (failure to
include correct information). A failure to
file timely includes a failure to file in the
required manner, for example, electroni­
cally or in other machine­readable form as
provided under section 6011(e). However,
no penalty is imposed under paragraph (a)
(1) of this section solely by reason of any
failure to comply with the requirements
of section 6011(e)(2), except to the ex­
tent that the failure occurs with respect to
more than 10 returns, or with respect to a
return described in section 6011(e)(4). If
a partnership return under section 6031(a)
is required to be filed electronically, each
schedule required to be included with
such return with respect to each partner
will be treated as a separate information
return for purposes of this section. See
section 6724(e). Filers who are required
to file information returns electronically
and who file those information returns
electronically are considered to have sat­
isfied the electronic­filing requirement.
Except as provided in paragraph (c)(1) or
(e)(1) of this section, a failure to include
correct information encompasses a failure
to include the information required by ap­
plicable information­reporting statutes or
by any administrative pronouncements
(such as regulations, revenue rulings, rev­
enue procedures, or information­reporting
forms, and form instructions). A failure to
include information in the correct format
may be either a failure to file timely an
information return or a failure to include
correct information on an information
return. For example, an error on an elec­
tronic submission to the Internal Revenue
Service that prevents processing by the
Internal Revenue Service may constitute a
failure to file timely. However, if informa­
tion is set forth on the wrong field of the
electronic submission, that error may con­
stitute a failure to file timely or a failure
to include correct information, depending
upon the extent of the failure. For purpos­
es of paragraph (b) of this section, a failure
to file corrected information returns in the
format required under §301.6011­2(c)(4)
(ii) is a failure to correct the correspond­
ing original information returns.
(b) * * *
(5) Examples. The provisions of para­
graphs (a) and (b)(1) through (4) of this
section may be illustrated by the follow­
ing examples. These examples do not take
into account any possible application of
the de minimis exception under paragraph
(d) of this section, the lower small­busi­
ness limitations under paragraph (e) of
this section, the penalty for intention­
al disregard under paragraph (f) of this
section, adjustments for inflation under

Bulletin No. 2023–11 557 March 13, 2023
section 6721(f), or the reasonable­cause
waiver under §301.6724­1(a):
* * * * *
(iii) Example 3. In calendar year 2024, Corpora­
tion U timely files on paper 12 Forms 1099–MISC
for the 2023 calendar year with correct information.
Under §301.6011­2, a person required to file at least
10 returns during calendar year 2024 must file those
returns electronically. Corporation U does not correct
its failures to file these returns electronically by Au­
gust 1, 2024. See section 6721(b)(2). Corporation U is
therefore subject to a penalty for a failure to file timely
under paragraph (a)(2) of this section. However, under
section 6724(c) and paragraph (a)(2) of this section,
the penalty for a failure to file timely electronically
applies only to the extent the number of returns ex­
ceeds 10. As Corporation U was required to file 12
returns electronically, it is subject to a penalty of $500
for two returns ($250 x 2 = $500).
(iv) Example 4. In calendar year 2024, Corpo­
ration W timely electronically files 25 Forms 1099­
B (relating to proceeds from broker and barter ex­
change transactions) with incorrect information. On
August 1, 2024, Corporation W discovers the errors
and files 25 corrected Forms 1099­B on paper. Under
§301.6011­2(c)(4)(ii)(A), a person required to file an
original information return covered by §301.6011­
2(b) electronically must file any corrected informa­
tion return corresponding to that original return elec­
tronically. Under paragraph (a)(2)(ii) of this section,
a failure to file a corrected information return elec­
tronically when required to do so is a failure to cor­
rect the corresponding original information return.
As Corporation W was required to file its 25 correct­
ed information returns electronically, it has failed to
correct the original information returns and is subject
to a penalty of $6,250 for failure to include correct
information on its 25 original Forms 1099­B ($250 x
25 = $6,250), without any reductions for correcting
the information on or before August 1.
(v) Example 5. During the 2024 calendar year,
Corporation V files 25 Forms 1099­B (relating to
proceeds from broker and barter exchange transac­
tions) on paper. The forms were filed on March 15,
2024, rather than on the required filing date of Febru­
ary 28, 2024. Under §301.6011­2, a person required
to file at least 10 returns during calendar years 2024
and after must file those returns electronically. Cor­
poration V does not correctly file these returns elec­
tronically by August 1, 2024. See section 6721(b)
(2). Corporation V is subject to a penalty of $500
for filing 10 of the returns late, but within 30 days
after the required filing date ($50 x 10). In addition,
Corporation V is subject to a penalty of $3,750 for
failing to file 15 returns electronically ($250 x 15).
(vi) Example 6. Partnership X has 120 partners in
calendar year 2023. In calendar year 2024, it timely
filed on paper its 2023 Form 1065 and 230 accompa­
nying Schedules K­1 and Schedules K­3 (120 Sched­
ules K­1 and 110 Schedules K­3). Partnership X filed
no other returns during calendar year 2024. Under
§301.6011­3(a)(1)(ii), a partnership with more than
100 partners must electronically file its partnership
return, including Schedules K­1 and K­3. Under
section 6724(e), Schedules K­1 and K­3 are treated
as separate information returns for purposes of pen­
alties under section 6721, even though they are not
listed under §301.6011­2(b) as information returns
required to be filed electronically and are not defined
as information returns under section 6724(d). Under
section 6724(c) and paragraph (a)(2) of this section,
the penalty for a failure to file timely electronically
applies only to the extent the number of returns ex­
ceeds 10. Partnership X would be subject to a pen­
alty of $55,000 for failing to electronically file 220
Schedules K­1 and K­3 required to be included with
the partnership return: the 11th through the 230th of
the required schedules ($250 x 220 = $55,000). See
section 6698 for the penalty for the failure to file the
partnership return.
* * * * *
(h) Applicability date. The rules of
paragraph (a)(2)(ii) of this section apply
to information returns required to be filed
during calendar years beginning after De­
cember 31, 2023. For the rules that apply
under paragraph (a)(2)(ii) of this section
to information returns required to be filed
during calendar years beginning before
January 1, 2024, see 26 CFR part 301, re­
vised as of April 1, 2022.
Melanie R. Krause,
Acting Deputy Commissioner for
Services and Enforcement.
Approved: August 7, 2022.
Lily Batchelder,
Assistant Secretary of the Treasury
(Tax Policy).
(Filed by the Office of the Federal Register on Febru­
ary 21, 2023, 11:15 a.m., and published in the issue
of the Federal Register for February 23, 2023, 88
F.R. 11754)
26 CFR 1.1502-80(j): Special rules for application
of section 951(a)(2)(B) to distributions to which sec-
tion 959(b) applies
T.D. 9973
DEPARTMENT OF THE
TREASURY
Internal Revenue Service
26 CFR Part 1
Single-Entity Treatment of
Consolidated Groups for
Specific Purposes
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Final regulations.
SUMMARY: This document contains
final regulations that treat members of
a consolidated group as a single United
States shareholder in certain cases for
purposes of section 951(a)(2)(B) of the
Internal Revenue Code (the “Code”).
The document finalizes proposed regula­
tions published on December 14, 2022.
The final regulations affect consoli­
dated groups that own stock of foreign
corporations.
DATES: Effective date: These regulations
are effective on February 23, 2023.
Applicability date: These regulations ap­
ply to taxable years for which the original
consolidated return is due (without exten­
sions) after February 23, 2023.
FOR FURTHER INFORMATION
CONTACT: Austin Diamond­Jones,
(202) 317­5085 (Corporate) and Julie
T. Wang, (202) 317­6975 (Corporate)
regarding section 1502 and the amend­
ments to §1.1502­80, and Joshua P. Rof­
fenbender, (202) 317­6934 (Internation­
al) regarding sections 951, 951A, and
959.
SUPPLEMENTARY INFORMATION:
Background
On December 14, 2022, the De­
partment of the Treasury (“Treasury
Department”) and the IRS published a
notice of proposed rulemaking (REG­
113839­22) in the Federal Register
(87 FR 76430) under sections 1502 and
7805(a) of the Code (the “proposed
regulations”). No comments were re­
ceived from the public in response to
the notice of proposed rulemaking. No
public hearing was requested or held.
This Treasury Decision adopts the pro­
posed regulations as final regulations
without modification.
Applicability Date
The final regulations apply to taxable
years for which the original consolidated
return is due (without extensions) after
February 23, 2023. See section 1503(a).

March 13, 2023 558 Bulletin No. 2023–11
Special Analyses
I. Regulatory Planning and Review —
Economic Analysis
These final regulations are not subject
to review under section 6(b) of Executive
Order 12866 pursuant to the Memoran­
dum of Agreement (April 11, 2018) be­
tween the Treasury Department and the
Office of Management and Budget regard­
ing review of tax regulations.
II. Regulatory Flexibility Act
Pursuant to the Regulatory Flexibili­
ty Act (5 U.S.C. chapter 6), it is hereby
certified that these final regulations will
not have a significant economic impact
on a substantial number of small entities.
This certification is based on the fact that
these final regulations apply only to cor­
porations that file consolidated Federal
income tax returns, and that such corpo­
rations almost exclusively consist of larg­
er businesses. Specifically, based on data
available to the IRS, corporations that file
consolidated Federal income tax returns
represent only approximately two percent
of all filers of Forms 1120 (U.S. Corpora­
tion Income Tax Return). However, these
consolidated Federal income tax returns
account for approximately 95 percent of
the aggregate amount of receipts provided
on all Forms 1120. Therefore, these final
regulations would not create additional
obligations for, or impose an economic
impact on, small entities. Accordingly, the
Secretary certifies that the final regula­
tions will not have a significant economic
impact on a substantial number of small
entities.
III. Section 7805(f)
Pursuant to section 7805(f), the pro­
posed regulations (REG­113839­22) pre­
ceding these final regulations were sub­
mitted to the Chief Counsel for Advocacy
of the Small Business Administration for
comment on its impact on small business,
and no comments were received.
IV. Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates
Reform Act of 1995 requires that agencies
assess anticipated costs and benefits and
take certain other actions before issuing a
final rule that includes any Federal mandate
that may result in expenditures 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 an­
nually for inflation. These final regulations
do not include any Federal mandate that
may result in expenditures by state, local,
or tribal governments, or by the private sec­
tor in excess of that threshold.
V. 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 sub­
stantial, 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. These final regulations
do not have federalism implications and
do not impose substantial direct compli­
ance costs on state and local governments
or preempt state law within the meaning
of the Executive order.
Drafting Information
The principal authors of these regula­
tions are Joshua P. Roffenbender, Office
of Associate Chief Counsel (Internation­
al), and Jeremy Aron­Dine and Gregory J.
Galvin, Office of Associate Chief Counsel
(Corporate). However, other personnel
from the IRS and the Treasury Depart­
ment participated in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and record­
keeping requirements.
Adoption of Amendments to the
Regulations
Accordingly, 26 CFR part 1 is amend­
ed 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. In §1.1502­80, reserved para­
graph (i) and paragraph (j) are added to
read as follows:
§1.1502-80 Applicability of other
provisions of law.
* * * * *
(i) [Reserved]
(j) Special rules for application of sec-
tion 951(a)(2)(B) to distributions to which
section 959(b) applies—(1) Single United
States shareholder treatment. In determin­
ing the amount described in section 951(a)
(2)(B) that is attributable to distributions
to which section 959(b) applies, members
of a group are treated as a single United
States shareholder (within the meaning of
section 951(b) (or section 953(c)(1)(A),
if applicable)) for purposes of determin­
ing the part of the year during which such
shareholder did not own (within the mean­
ing of section 958(a)) the stock described
in section 951(a)(2)(A). The purpose of
this paragraph (j) is to facilitate the clear
reflection of income of a consolidated
group by ensuring that the location of
ownership of stock of a foreign corpora­
tion within the group does not affect the
amount of the group’s income by reason
of sections 951(a)(1)(A) and 951A(a).
(2) Examples. The following examples
illustrate the application of paragraph (j)
(1) of this section. For purposes of the
examples in this paragraph (j)(2): M1
and M2 are members of a consolidated
group of which P is the common parent (P
group); each of CFC1, CFC2, and CFC3
is a controlled foreign corporation (with­
in the meaning of section 957(a)) with
the U.S. dollar as its functional currency
(within the meaning of section 985); the
taxable year of all entities is the calendar
year for Federal income tax purposes; and
a reference to stock owned means stock
owned within the meaning of section
958(a). These examples do not address
common law doctrines or other authorities
that might apply to recast a transaction or
to otherwise affect the tax treatment of a
transaction.
(i) Example 1: Intercompany transfer of stock
of a controlled foreign corporation—(A) Facts.
Throughout Year 1, M1 directly owns all the stock of
CFC1, which directly owns all the stock of CFC2. In
Year 1, CFC2 has $100x of subpart F income (as de­
fined in section 952). M1’s pro rata share of CFC2’s

Bulletin No. 2023–11 559 March 13, 2023
subpart F income for Year 1 is $100x, which M1 in­
cludes in its gross income under section 951(a)(1)
(A). In Year 2, CFC2 has $80x of subpart F income
and distributes $80x to CFC1 (the CFC2 Distribu­
tion). Section 959(b) applies to the entire CFC2 Dis­
tribution. On December 29, Year 2, M1 transfers all
of its CFC1 stock to M2 in an exchange described in
section 351(a). As a result, on December 31, Year 2
(the last day of Year 2 on which CFC2 is a controlled
foreign corporation), M2 owns 100% of the stock of
CFC1, which owns 100% of the stock of CFC2.
(B) Analysis. Under paragraph (j)(1) of this sec­
tion, in determining the amount described in section
951(a)(2)(B) that is attributable to the CFC2 Distri­
bution, all members of the P group are treated as a
single United States shareholder for purposes of
determining the part of Year 2 during which such
shareholder did not own the stock of CFC2. Thus,
the ratio of the number of days in Year 2 that such
United States shareholder did not own the stock of
CFC2 to the total number of days in Year 2 is 0/365.
The amount described in section 951(a)(2)(B) is $0,
M2’s pro rata share of CFC2’s subpart F income for
Year 2 is $80x ($80x ­ $0), and M2 must include
$80x in its gross income under section 951(a)(1)(A).
(ii) Example 2: Transfer of stock of a controlled
foreign corporation between controlled foreign cor-
porations—(A) Facts. The facts are the same as in
paragraph (j)(2)(i)(A) of this section (the facts in Ex-
ample 1), except that M1 does not transfer its CFC1
stock to M2. Additionally, throughout Year 1 and
from January 1, Year 2, to December 29, Year 2, M2
directly owns all 90 shares of the only class of stock
of CFC3. Further, on December 29, Year 2, CFC3
acquires all the CFC2 stock from CFC1 in exchange
for 10 newly issued shares of the same class of CFC3
stock in a transaction described in section 368(a)(1)
(B). As a result, on December 31, Year 2, M1 owns
10% of the stock of CFC2, and M2 owns 90% of the
stock of CFC2.
(B) Analysis. Under paragraph (j)(1) of this sec­
tion, in determining the amount described in section
951(a)(2)(B) that is attributable to the portion of the
CFC2 Distribution with respect to each of the CFC2
stock that M1 owns on December 31, Year 2, and the
CFC2 stock that M2 owns on that day, all members
of the P group are treated as a single United States
shareholder for purposes of determining the part of
Year 2 during which such shareholder did not own
such stock. In each case, the ratio of the number of
days in Year 2 that such United States shareholder
did not own such stock to the total number of days in
Year 2 is 0/365, and the amount described in section
951(a)(2)(B) is $0. M1’s and M2’s pro rata shares of
CFC2’s subpart F income for Year 2 are $8x ($8x ­
$0) and $72x ($72x ­ $0), respectively, and M1 and
M2 must include $8x and $72x in gross income un­
der section 951(a)(1)(A), respectively.
(3) Applicability date. This paragraph
(j) applies to taxable years for which the
original consolidated Federal income tax
return is due (without extensions) after
February 23, 2023.
Melanie R. Krause,
Acting Deputy Commissioner for
Services and Enforcement.
Approved: February 6, 2023.
Lily L. Batchelder,
Assistant Secretary of the Treasury
(Tax Policy).
(Filed by the Office of the Federal Register on Febru­
ary 22, 2023, 8:45 a.m., and published in the issue of
the Federal Register for February 23, 2023, 88 F.R.
11393)

March 13, 2023 560 Bulletin No. 2023–11
Part III
Update for Weighted
Average Interest Rates,
Yield Curves, and Segment
Rates
Notice 2023-19
This notice provides guidance on the
corporate bond monthly yield curve, the
corresponding spot segment rates used
under § 417(e)(3), and the 24­month aver­
age segment rates under § 430(h)(2) of the
Internal Revenue Code. In addition, this
notice provides guidance as to the interest
rate on 30­year 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 sin­
gle­employer 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 val­
ue is generally determined using three
24­month average interest rates (“segment
rates”), each of which applies to cash
flows during specified periods. To the ex­
tent provided under § 430(h)(2)(C)(iv),
these segment rates are adjusted by the ap­
plicable percentage of the 25­year average
segment rates for the period ending Sep­
tember 30 of the year preceding the cal­
endar 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 segment rates.
Notice 2007­81, 2007­44 I.R.B. 899,
provides guidelines for determining the
monthly corporate bond yield curve, and
the 24­month average corporate bond
segment rates used to compute the target
normal cost and the funding target. Con­
sistent with the methodology specified in
Notice 2007­81, the monthly corporate
bond yield curve derived from January
2023 data is in Table 2023­1 at the end
of this notice. The spot first, second, and
third segment rates for the month of Janu­
ary 2023 are, respectively, 4.74, 4.98, and
4.84.
The 24­month 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 percentag­
es of the corresponding 25­year average
segment rates. For this purpose, any 25­
year average segment rate that is less than
5% is deemed to be 5%. The 25­year av­
erage segment rates for plan years begin­
ning in 2022 and 2023 were published in
Notice 2021­54, 2021­41 I.R.B. 457 and
Notice 2022­40, 2022­40 I.R.B. 266, re­
spectively. The applicable minimum and
maximum percentages are 95% and 105%
for a plan year beginning in 2022 or 2023.
24­MONTH AVERAGE CORPORATE
BOND SEGMENT RATES
The three 24­month average corporate
bond segment rates applicable for February
2023 without adjustment for the 25­year
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
February 2023 2.31 3.72 4.00
The adjusted 24­month average seg­
ment rates set forth in the chart below re­
flect § 430(h)(2)(C)(iv) of the Code. The
24­month averages applicable for January
2023, adjusted to be within the applicable
minimum and maximum percentages of
the corresponding 25­year 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
2022February 20234.755.185.92
2023February 20234.755.005.74
30­YEAR TREASURY SECURITIES
INTEREST RATES
Section 431 specifies the minimum
funding requirements that apply to multi­
employer plans pursuant to § 412. Section
431(c)(6)(B) specifies a minimum amount
for the full­funding limitation described in
§ 431(c)(6)(A), based on the plan’s current
liability. Section 431(c)(6)(E)(ii)(I) pro­
vides that the interest rate used to calculate
current liability for this purpose must be
no more than 5 percent above and no more
than 10 percent below the weighted aver­
age of the rates of interest on 30­year Trea­
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)).

Bulletin No. 2023–11 561 March 13, 2023
sury securities during the four­year period
ending on the last day before the beginning
of the plan year. Notice 88­73, 1988­2 C.B.
383, provides guidelines for determining
the weighted average interest rate. The rate
of interest on 30­year Treasury securities
for January 2023 is 3.67 percent. The Ser­
vice determined this rate as the average of
the daily determinations of yield on the 30­
year Treasury bond maturing in November
2052. For plan years beginning in February
2023, the weighted average of the rates of
interest on 30­year Treasury securities and
the permissible range of rates used to cal­
culate current liability are as follows:
Treasury Weighted Average Rates
For Plan Years Beginning In30-Year Treasury Weighted AveragePermissible Range 90% to 105%
February 20232.482.23 to 2.60
MINIMUM PRESENT VALUE
SEGMENT RATES
In general, the applicable interest rates
under § 417(e)(3)(D) are segment rates
computed without regard to a 24­month
average. Notice 2007­81 provides guide­
lines for determining the minimum pres­
ent value segment rates. Pursuant to that
notice, the minimum present value seg­
ment rates determined for January 2023
are as follows:
Minimum Present Value Segment Rates
Month First Segment Second Segment Third Segment
January 2023 4.74 4.98 4.84
DRAFTING INFORMATION
The principal author of this notice is
Tom Morgan of the Office of Associate
Chief Counsel (Employee Benefits, Ex­
empt Organizations, and Employment
Taxes). However, other personnel from
the IRS participated in the development of
this guidance. For further information re­
garding this notice, contact Mr. Morgan at
202­317­6700 or Tony Montanaro at 626­
927­1475 not toll­free numbers).

March 13, 2023 562 Bulletin No. 2023–11
Table 2023-1
Monthly Yield Curve for January 2023
Derived from January 2023 Data
MaturityYieldMaturityYieldMaturityYieldMaturityYieldMaturityYield
0.54.9320.55.0140.54.8260.54.7780.54.74
1.04.8921.05.0041.04.8261.04.7781.04.74
1.54.8621.54.9941.54.8261.54.7781.54.74
2.04.8122.04.9842.04.8262.04.7782.04.74
2.54.7522.54.9842.54.8262.54.7782.54.74
3.04.7023.04.9743.04.8163.04.7683.04.74
3.54.6523.54.9643.54.8163.54.7683.54.74
4.04.6224.04.9544.04.8164.04.7684.04.74
4.54.6024.54.9444.54.8164.54.7684.54.74
5.04.6025.04.9345.04.8165.04.7685.04.74
5.54.6225.54.9345.54.8165.54.7685.54.74
6.04.6426.04.9246.04.8066.04.7686.04.74
6.54.6826.54.9246.54.8066.54.7686.54.73
7.04.7227.04.9147.04.8067.04.7687.04.73
7.54.7727.54.9147.54.8067.54.7687.54.73
8.04.8128.04.9048.04.8068.04.7688.04.73
8.54.8628.54.9048.54.8068.54.7688.54.73
9.04.9029.04.8949.04.8069.04.7589.04.73
9.54.9429.54.8949.54.7969.54.7589.54.73
10.04.9830.04.8850.04.7970.04.7590.04.73
10.55.0130.54.8850.54.7970.54.7590.54.73
11.05.0431.04.8851.04.7971.04.7591.04.73
11.55.0631.54.8751.54.7971.54.7591.54.73
12.05.0832.04.8752.04.7972.04.7592.04.73
12.55.0932.54.8752.54.7972.54.7592.54.73
13.05.1033.04.8653.04.7873.04.7593.04.73
13.55.1133.54.8653.54.7873.54.7593.54.73
14.05.1134.04.8654.04.7874.04.7594.04.73
14.55.1134.54.8554.54.7874.54.7594.54.73
15.05.1135.04.8555.04.7875.04.7595.04.73
15.55.1135.54.8555.54.7875.54.7595.54.73
16.05.1036.04.8556.04.7876.04.7596.04.73
16.55.0936.54.8456.54.7876.54.7496.54.73
17.05.0937.04.8457.04.7877.04.7497.04.73
17.55.0837.54.8457.54.7777.54.7497.54.73
18.05.0738.04.8458.04.7778.04.7498.04.73
18.55.0638.54.8358.54.7778.54.7498.54.72
19.05.0539.04.8359.04.7779.04.7499.04.72
19.55.0439.54.8359.54.7779.54.7499.54.72
20.05.0240.04.8360.04.7780.04.74100.04.72

Bulletin No. 2023–11 563 March 13, 2023
Lookback Periods for
Claims for Credit or Refund
for Returns with Due Dates
Postponed by Notice 2020-
23 or Notice 2021-21
Notice 2023-21
SECTION 1. PURPOSE
On March 13, 2020, the President of
the United States issued an emergency
declaration under the Robert T. Stafford
Disaster Relief and Emergency Assistance
Act in response to the ongoing Coronavi­
rus Disease 2019 (COVID­19) pandemic
(Emergency Declaration). The Emergen­
cy Declaration instructed the Secretary
of the Treasury “to provide relief from
tax deadlines to Americans who have
been adversely affected by the COVID­19
emergency, as appropriate, pursuant to 26
U.S.C. 7508A(a).” Pursuant to the Emer­
gency Declaration, this notice provides
relief under § 7508A(a) of the Internal
Revenue Code (Code) for the persons
described in section 3.A of this notice de­
termined to be affected by the COVID­19
emergency.
1
SECTION 2. BACKGROUND
Section 7508A of the Code provides the
Secretary of the Treasury or her delegate
(Secretary) with authority to postpone the
time for performing certain acts under the
internal revenue laws for a taxpayer deter­
mined by the Secretary to be affected by
a Federally declared disaster as defined in
§ 165(i)(5)(A). Pursuant to § 7508A(a), a
period of up to one year may be disregard­
ed in determining under the internal reve­
nue laws, in respect of any tax liability of
such taxpayer, whether the performance
of certain acts is timely; the amount of
any interest, penalty, additional amount,
or addition to the tax for periods after
such date; and the amount of any credit
or refund. Under § 301.7508A­1(b)(4) of
the Procedure and Administration Regula­
tions (26 CFR part 301), a postponement
of time under § 7508A to perform an act
is not an extension of the due date for the
act.
Section 6511(a) requires a taxpayer
to file a claim for credit or refund within
three years from the time the taxpayer’s
return was filed or two years from the time
the tax was paid, whichever period expires
later. Under § 6511(b)(2), the amount of a
credit or refund is limited to the amount of
tax paid within a specified period immedi­
ately preceding the filing of the claim for
credit or refund (lookback period). When
a taxpayer files a claim within three years
of filing the taxpayer’s return, the look­
back period is equal to three years plus the
period of any extension of time for filing
the return. Otherwise, the lookback period
is two years. For a calendar­year taxpayer,
withheld and estimated income taxes are
deemed paid on the due date of the tax re­
turn, generally April 15 of each year. See
§ 6513(b)(1) and (2).
Among other things, Notice 2020­
23, 2020­18 I.R.B. 742 (April 27, 2020),
which amplified Notice 2020­18 and No­
tice 2020­20, postponed certain Federal
tax return filing and payment obligations
that were due to be performed on or after
April 1, 2020, and before July 15, 2020,
to July 15, 2020. Similarly, Notice 2021­
21, 2021­15 I.R.B. 986 (April 12, 2021),
postponed the due date for both filing Fed­
eral income tax returns in the Form 1040
series with an original due date of April
15, 2021, and making Federal income tax
payments in connection with one of these
forms, to May 17, 2021. Under § 6511,
taxpayers who timely filed their tax re­
turns by the postponed due dates provided
by Notice 2020­23 and Notice 2021­21
have three years from the date of filing
their return for each year to timely file a
claim for credit or refund for that year.
Although Notice 2020­23 and Notice
2021­21 postponed certain return filing
due dates, those notices did not extend the
time for filing the returns because a post­
ponement is not an extension. As a result,
the postponements did not lengthen the
lookback periods under § 6511(b)(2)(A).
The dates on which withheld taxes
are deemed paid under § 6513(b)(1) or
(2) were not affected by Notice 2020­23
or Notice 2021­21. Accordingly, absent
the relief granted in this notice, although
some calendar­year taxpayers may have
until July 15, 2023,
2
or May 17, 2024, to
timely file a claim for credit or refund for
their taxable years postponed by Notice
2020­23 and Notice 2021­21, in order for
the applicable lookback period to include
all available amounts, taxpayers who did
not receive an extension of time for fil­
ing a return must file a claim for credit or
refund within three years of the due date
of the return (generally April 15, 2020 or
April 15, 2021, respectively). The relief
granted in section 3 of this notice permits
taxpayers who had a return filing due date
postponed by Notice 2020­23 or Notice
2021­21, who did not receive an extension
of time for filing such return, and who
file timely claims for credit or refund to
be credited or refunded amounts deemed
paid on April 15 of each year.
SECTION 3. GRANT OF RELIEF
A. Taxpayers Affected by COVID-19
Emergency. The Secretary has determined
that any person with a Federal tax return
filing or payment obligation that was post­
poned by Notice 2020­23 to July 15, 2020,
is affected by the COVID­19 emergency
for purposes of the relief described in this
section 3 (Affected Taxpayer). The Secre­
tary has also determined that any person
with a filing or payment obligation with
respect to a Federal income tax return in
the Form 1040 series that was postponed
by Notice 2021­21 to May 17, 2021, is an
Affected Taxpayer.
B. Relief for Determining the Look-
back Period for Claims for Credit or
Refund. For an Affected Taxpayer with a
due date postponed by Notice 2020­23,
the period beginning on April 15, 2020,
and ending on July 15, 2020, will be dis­
regarded in determining the beginning
of the lookback period for the purpose
of determining the amount of a credit or
refund under § 6511(b)(2)(A) relating
1
Unless otherwise specified, all “section” or “§” references are to sections of the Code.
2
Because July 15, 2023, is a Saturday, a claim for credit or refund for a return with a due date postponed by Notice 2020­23 would be considered timely if a taxpayer filed the claim on Mon­
day, July 17, 2023. See § 7503. In that scenario, for the purposes of calculating the lookback period under § 6511(b)(2)(A), the claim for credit or refund would be treated as if it were filed
on July 15, 2023 (not July 17), and the lookback period would run back to July 15, 2020, absent the relief granted in this notice. See Rev. Rul. 66­118, 1966­1 C.B. 290; Rev. Rul. 2003­41,
2003­17 I.R.B. 814 (April 28, 2003).

March 13, 2023 564 Bulletin No. 2023–11
to the tax for which the return filing or
payment due date was postponed. In ad­
dition, for an Affected Taxpayer with a
due date postponed by Notice 2021­21,
the period beginning on April 15, 2021,
and ending on May 17, 2021, will be dis­
regarded in determining the beginning
of the lookback period for the purpose
of determining the amount of a credit or
refund under § 6511(b)(2)(A) relating to
the tax for which the return filing or pay­
ment due date was postponed.
C. Example. Taxpayer is a calen­
dar­year filer with a 2019 Federal income
tax return due date of April 15, 2020. Tax­
payer’s employer withheld income taxes
from Taxpayer’s wages throughout 2019
and remitted the withheld income taxes to
the IRS. Per § 6513(b), these withheld in­
come taxes are deemed paid on April 15,
2020. The due date for Taxpayer’s 2019
Federal income tax return was postponed
by Notice 2020­23 to July 15, 2020. Pur­
suant to the postponed due date, Taxpayer
timely filed their return on June 22, 2020.
Under § 6511(a), Taxpayer may timely
file a claim for credit or refund until three
years from the return filing date, or June
22, 2023. But if Taxpayer files a claim
for credit or refund on June 22, 2023, ab­
sent the relief granted in this notice, the
amount of Taxpayer’s credit or refund
would be limited to tax paid during the
period beginning three years before the
filing of the claim, or June 22, 2020. As
a result, a credit or refund of Taxpayer’s
withheld income taxes would be barred
because they were deemed paid on April
15, 2020, outside of the lookback period
in § 6511(b)(2)(A). This notice provides
relief by disregarding the period begin­
ning on April 15, 2020, and ending on
July 15, 2020, in determining the begin­
ning of the lookback period. Accordingly,
under the relief provided by this notice, if
Taxpayer files a claim for credit or refund
on or before June 22, 2023, the lookback
period extends three years back from the
date of the claim, disregarding the period
beginning on April 15, 2020, and ending
on July 15, 2020. As a result, the limit to
the amount of the credit or refund would
include Taxpayer’s withheld income taxes
deemed paid on April 15, 2020.
The relief provided under § 7508A in
this notice is automatic. Affected Taxpay­
ers do not have to call the IRS, file any
form, or send letters or other documents to
receive this relief.
SECTION 4. DRAFTING
INFORMATION
The principal author of this notice is
Andrew C. Keaton of the Office of Asso­
ciate Chief Counsel (Procedure and Ad­
ministration). For further information re­
garding this notice, contact Mr. Keaton at
(202) 317­6833 (not a toll­free number).

Bulletin No. 2023–11 565 March 13, 2023
Part IV
Notice of Proposed
Rulemaking
Use of forfeitures in
qualified retirement plans.
REG-122286-18
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Notice of proposed rulemaking
SUMMARY: This document sets forth
proposed regulations that would provide
rules relating to the use of forfeitures in
qualified retirement plans, including a
deadline for the use of forfeitures in de­
fined contribution plans. These proposed
regulations would affect participants in,
beneficiaries of, administrators of, and
sponsors of qualified retirement plans.
DATES: Written or electronic comments
must be received by May 30, 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 REG­122286­18) 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 (Treasury Department) and
the IRS will publish to the IRS’s public
docket, for public availability, any com­
ments submitted, whether electronically
or on paper. Send paper submissions to:
CC:PA:LPD:PR (REG­122286­18), room
5203, Internal Revenue Service, PO Box
7604, Ben Franklin Station, Washington,
DC 20044.
FOR FURTHER INFORMATION
CONTACT: Concerning the proposed
regulations, call Brandon M. Ford or
Joyce I. Kahn at (202) 317­4148; concern­
ing submission of comments and requests
for a public hearing, call Vivian Hayes at
(202) 317­5306 (not toll­free numbers) or
email publichearings@irs.gov.
SUPPLEMENTARY INFORMATION:
Background
General Forfeiture Rules for Qualified
Plans
Section 401(a)(7) of the Internal Rev­
enue Code (Code) provides that a trust
forming part of a stock bonus, pension, or
profit­sharing plan of an employer for the
exclusive benefit of its employees or their
beneficiaries will not constitute a qualified
trust under section 401(a) unless its relat­
ed stock bonus, pension, or profit­sharing
plan satisfies the requirements of section
411 (relating to minimum vesting stan­
dards).
1
Section 411(a) generally provides
that an employee’s right to accrued bene­
fits derived from employer contributions
must become nonforfeitable after a spec­
ified period of service. Section 411(a)
also provides exceptions to this general
rule under which an employee’s benefit is
permitted to be forfeited without violating
section 411, conditions under which for­
feited amounts must be restored upon a
participant’s repayment of a withdrawal,
and other rules related to vesting.
Section 2(2) of the Self­Employed
Individuals Tax Retirement Act of 1962,
Pub. L. No. 87­792, 76 Stat. 809, added
section 401(a)(8) of the Code, providing
that a trust forming part of a pension plan
will not constitute a qualified trust under
section 401(a) unless the plan provides
that forfeitures must not be applied to in­
crease the benefits any employee would
otherwise receive under the plan.
Section 1.401­7(a), promulgated in
1963, generally provides, in the case of a
trust forming a part of a qualified pension
plan, that the plan must expressly provide
that forfeitures arising from severance of
employment, from death, or for any other
reason may not be applied to increase the
benefits any employee would otherwise
receive under the plan at any time prior to
the termination of the plan or the complete
discontinuance of employer contributions
under the plan, and that the amounts so
forfeited must be used as soon as possi­
ble to reduce the employer’s contribu­
tions under the plan. Section 1.401­7(a)
also provides that a qualified pension plan
may anticipate the effect of forfeitures
in determining costs under the plan, and
that a qualified plan will not be disqual­
ified merely because a determination of
the amount of forfeitures under the plan is
made only once during each taxable year
of the employer.
Section 1.401­1(b)(1)(i) provides that
a pension plan is a plan established and
maintained by an employer primarily to
provide systematically for the payment
of definitely determinable benefits to em­
ployees over a period of years, usually for
life, after retirement. Section 1.401­1(b)
(1)(i) further provides that benefits under
a pension plan are not definitely deter­
minable if funds arising from forfeitures
on termination of service, or other reason,
may be used to provide increased ben­
efits for the remaining participants. Sec­
tion 1.401­1(b)(1)(i) specifically refers
to §1.401­7, relating to the treatment of
forfeitures under a qualified pension plan,
in setting forth the requirement that for­
feitures not be used to provide increased
benefits for participants.
Section 1119(a) of the Tax Reform Act
of 1986, Pub. L. 99­514, 100 Stat. 2085
(TRA 86), amended section 401(a)(8) of
the Code to replace the term “pension
plan” (which includes a defined contribu­
tion money purchase pension plan) with
the term “defined benefit plan” (which
does not include a money purchase pen­
sion plan). The conference report accom­
panying TRA 86 (Conference Report) ex­
plained that, prior to TRA 86, forfeitures
under a money purchase pension plan
could not be used to increase benefits,
but were required to be applied to reduce
future employer contributions or to offset
1
There are parallel vesting requirements in section 203 of the Employee Retirement Income Security Act of 1974, Pub. L. No. 93­406, 88 Stat. 829 (ERISA). The IRS has interpretive authority
over that section pursuant to Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1, 92 Stat. 3790. (Reorganization Plan No. 4).

March 13, 2023 566 Bulletin No. 2023–11
administrative expenses of the plan, and
that forfeitures in a defined contribution
plan that is not a money purchase pension
plan could be reallocated to the remaining
participants under a nondiscriminatory
formula, used to reduce future employer
contributions, or used to offset administra­
tive expenses of the plan. H.R. Rept. No.
99­841, at II­442 (1986). The Conference
Report also noted that the changes made
by TRA 86 provided uniform rules regard­
ing the use of forfeitures under any de­
fined contribution plan and stated that, fol­
lowing these changes, “forfeitures arising
in any defined contribution plan (includ­
ing a money purchase pension plan) can
be either (1) reallocated to the accounts
of other participants in a nondiscrimina­
tory fashion, or (2) used to reduce future
employer contributions or administrative
costs.” Id.
Forfeitures in Defined Contribution Plans
Section 414(i) provides that a defined
contribution plan is a plan that provides
for an individual account for each partic­
ipant and for benefits based solely on the
amount contributed to the participant’s
account, and any income, expenses, gains
and losses, and any forfeitures of accounts
of other participants which may be allo­
cated to the participant’s account.
Section 1.401­1(b)(1) provides rules
related to specific types of qualified re­
tirement plans. Section 1.401­1(b)(1)(i)
provides that a pension plan (including a
money purchase pension plan) is a plan
established and maintained by an employ­
er primarily to provide systematically for
the payment of definitely determinable
benefits and that a plan will be considered
a pension plan if employer contributions
can be determined actuarially on the ba­
sis of definitely determinable benefits, or,
as in the case of money purchase pension
plans, such contributions are fixed without
being geared to profits. Section 1.401­1(b)
(1)(ii) provides that a profit­sharing plan
must provide a definite predetermined
formula for allocating the contributions
made to the plan among the participants
and for distributing the funds accumulated
under the plan. Section 1.401­1(b)(1)(iii)
applies similar requirements to a stock bo­
nus plan.
Rev. Rul. 80­155, 1980­1 CB 84, pro­
vides that profit­sharing plans, stock bo­
nus plans, and money purchase pension
plans are required to provide for distribu­
tions in accordance with amounts stated or
ascertainable and credited to participants.
The revenue ruling further provides that
amounts that are to be allocated or dis­
tributed to a particular participant are as­
certainable only if the plan provides for a
valuation at least annually.
A 2010 Newsletter of the Employee
Plans office of the IRS’s Tax Exempt and
Government Entities Division (Retirement
News for Employers, Vol. 7, Spring 2010)
(the 2010 Newsletter)
2
noted that some
defined contribution plan administrators
place forfeited amounts into a plan sus­
pense account, allowing them to accumu­
late over several years, but that the Code
does not allow this practice. It advised
that a plan document should have provi­
sions detailing how and when a plan will
use or allocate plan forfeitures, and it de­
scribed deadlines for the use or allocation
of forfeitures.
3
Forfeitures in Defined Benefit Plans
As originally enacted, section 401(a)
(8) provided that a trust forming part of
a pension plan will not constitute a qual­
ified trust under section 401(a) unless
the plan provides that forfeitures must
not be applied to increase the benefits
any employee would otherwise receive
under the plan. As noted in the section
of this preamble titled “General Forfei­
ture Rules for Qualified Plans,” section
1119(a) of TRA 86 amended section
401(a)(8) of the Code to replace the term
“pension plan” with the term “defined
benefit plan,” with the result that defined
benefit plans continue to be subject to the
rule that forfeitures may not be used to
increase benefits.
The use of forfeitures in defined bene­
fit plans has also changed since the issu­
ance in 1963 of §1.401­7 (which provides
that amounts forfeited in pension plans
must be used as soon as possible to re­
duce employer contributions), due to the
enactment of new minimum funding re­
quirements applicable to defined benefit
plans. For example, in 1974 ERISA added
section 412 to the Code, which requires
qualified defined benefit plans (and cer­
tain qualified defined contribution plans)
to satisfy a minimum funding standard.
4

Subsequently, the minimum funding
standards have been modified to provide
differing standards for different types of
plans. See sections 430, 431, and 433.
None of the provisions that set forth
minimum funding requirements for qual­
ified defined benefit plans allow required
contributions to be offset by forfeitures of
accrued benefits. Instead, all of these pro­
visions require the use of reasonable actu­
arial assumptions to determine the effect
of expected forfeitures on plan liabilities.
See sections 430(h), 431(c)(3), and 433(c)
(3). Any difference between actual forfei­
tures and expected forfeitures is reflected
in future contributions required under sec­
tion 412 pursuant to the funding method
used for the plan under section 430, 431,
or 433.
Explanation of Provisions
Use of Forfeitures in Defined
Contribution Plans
Consistent with changes made by TRA
86 providing uniform rules for the use of
forfeitures in defined contribution plans
(as described in the Conference Report),
the proposed regulations would clari­
fy that forfeitures arising in any defined
contribution plan (including in a money
purchase pension plan) may be used for
one or more of the following purposes, as
specified in the plan: (1) to pay plan ad­
ministrative expenses, (2) to reduce em­
ployer contributions under the plan, or (3)
to increase benefits in other participants’
2
www.irs.gov/pub/irs­pdf/p4278.pdf
3
In particular, the newsletter advised that generally “[n]o forfeitures in a suspense account should remain unallocated beyond the end of the plan year in which they occurred,” and that “[f]or
those plans that use forfeitures to reduce plan expenses or employer contributions, there should be plan language and administrative procedures to ensure that current year forfeitures will be
used up promptly in the year in which they occurred or in appropriate situations no later than the immediately succeeding plan year.”
4
Section 302 of Title I of ERISA sets forth minimum funding standards that are parallel to the minimum funding standards in section 412 of the Code. The IRS has interpretive authority over
section 302 of title I of ERISA pursuant to Reorganization Plan No. 4.

Bulletin No. 2023–11 567 March 13, 2023
accounts in accordance with plan terms.
5

The use of forfeitures to reduce employ­
er contributions includes the restoration
of inadvertent benefit overpayments and
the restoration of conditionally forfeited
participant accounts that might other­
wise require additional employer contri­
butions, for example, the restoration of
accounts conditionally forfeited under
§1.411(a)­7(d) (relating to certain distri­
butions and cash­outs of accrued benefits).
Timing for Use of Forfeitures in a
Defined Contribution Plan
The proposed regulations would gen­
erally require that plan administrators
use forfeitures no later than 12 months
after the close of the plan year in which
the forfeitures are incurred. This deadline
is intended to simplify administration by
providing a single deadline for the use of
forfeitures that applies for all types of de­
fined contribution plans and to alleviate
administrative burdens that may arise in
using or allocating forfeitures if forfeitures
are incurred late in a plan year. The dead­
line in the proposed regulations is similar
to the deadline under §1.401(k)­2(b)(2)
(v) for a section 401(k) plan to correct
excess contributions by making correc­
tive distributions, which is 12 months af­
ter the close of the plan year in which the
excess contributions arise. The proposed
regulations would not affect generally ap­
plicable deadlines related to the timing of
contributions and allocations under a plan,
such as the deadline for correcting excess
contributions to avoid excise taxes under
section 4979 as set forth in §1.401(k)­2(b)
(5)(i).
The proposed regulations provide a
transition rule related to the 12­month
deadline. Under this rule, forfeitures in­
curred during any plan year that begins
before January 1, 2024, are treated as
having been incurred in the first plan year
that begins on or after January 1, 2024; ac­
cordingly, those forfeitures must be used
no later than 12 months after the end of
that first plan year. As described in the
section of this preamble titled “Proposed
Applicability Date,” these regulations are
proposed to apply for plan years begin­
ning on or after January 1, 2024.
Although nothing in the proposed reg­
ulations would preclude a plan document
from specifying only one use for forfei­
tures, the plan may fail operationally if for­
feitures in a given year exceed the amount
that may be used for that one purpose. For
example, if (1) a plan provides that for­
feitures may be used solely to offset plan
administrative expenses, (2) plan partici­
pants incur $25,000 of forfeitures in a plan
year, and (3) the plan incurs only $10,000
in plan administrative expenses before the
end of the 12­month period following the
end of that plan year, there will be $15,000
of forfeitures that remain unused after the
deadline established in these proposed
regulations. Thus, the plan would incur an
operational qualification failure because
forfeitures remain unused at the end of the
12­month period following the end of that
plan year. The plan could avoid this failure
if it were amended to permit forfeitures to
be used for more than one purpose.
Use of Forfeitures in Defined Benefit
Plans
The proposed regulations would up­
date rules relating to the use of forfeitures
in defined benefit plans to reflect the en­
actment, after the issuance of §1.401­7,
of new minimum funding requirements
applicable to defined benefit plans. In
addition, the requirement in existing
§1.401­7(a) that forfeitures under pen­
sion plans be used as soon as possible to
reduce employer contributions would be
eliminated because it is inconsistent with
those minimum funding requirements.
The minimum funding requirements of
sections 412, 430, 431, and 433 do not
allow the use of forfeitures to reduce re­
quired employer contributions to a defined
benefit plan in the manner contemplated
by existing § 1.401­7. Instead, reasonable
actuarial assumptions are used to deter­
mine the effect of expected forfeitures on
the present value of plan liabilities under
the plan’s funding method. Differences
between actual forfeitures and expected
forfeitures will increase or decrease the
plan’s minimum funding requirement for
future years pursuant to the plan’s funding
method.
Proposed Applicability Date
These regulations are proposed to ap­
ply for plan years beginning on or after
January 1, 2024. Thus, for example, the
deadline for the use of defined contribu­
tion plan forfeitures incurred in a plan year
beginning during 2024 will be 12 months
after the end of that plan year. Taxpayers,
however, may rely on these proposed reg­
ulations for periods preceding the applica­
bility date.
Special Analyses
These proposed regulations are not
subject to review under section 6(b) of
Executive Order 12866 pursuant to the
Memorandum of Agreement (April 11,
2018) between the Treasury Department
and the Office of Management and Budget
regarding review of tax regulations.
It is hereby certified that these proposed
regulations will not have a significant eco­
nomic impact on a substantial number of
small entities pursuant to the Regulatory
Flexibility Act (5 U.S.C. chapter 6). The
Treasury Department and the IRS under­
stand that (1) plans typically provide for
the use of (and use) forfeitures in a man­
ner consistent with the proposed regula­
tions and (2) defined contribution plans
typically use forfeitures by the deadline
set forth in the proposed regulations (con­
sistent with the 2010 Newsletter). Accord­
ingly, for most plans, the proposed regula­
tions are not expected to require changes
to plan terms or plan operations, or other­
wise have a significant economic impact
on plans or plan sponsors. If any plans
have terms or operations that are inconsis­
tent with the proposed regulations, it is not
expected that these proposed regulations
will have a significant economic impact on
those plans or the sponsors of those plans.
For example, the proposed regulations do
not require any additional employer con­
tributions or impose burdensome opera­
tional requirements. Notwithstanding this
5
Additionally, under section 6001, plan administrators must keep records necessary to demonstrate compliance with the qualification requirements of section 401(a), including records related
to the use of forfeitures.

March 13, 2023 568 Bulletin No. 2023–11
certification that the proposed regulations
would not have a significant economic
impact on a substantial number of small
entities, the Treasury Department and the
IRS invite comments on the impacts these
proposed regulations may have on small
entities. Pursuant to section 7805(f), these
proposed regulations will be submitted
to the Chief Counsel for Advocacy of the
Small Business Administration for com­
ment on its impact on small business.
Comments and Requests 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 Treasury Depart­
ment and the IRS as prescribed in this pre­
amble under the “ADDRESSES” heading.
The Treasury Department and the IRS re­
quest comments on all aspects of the pro­
posed rules. Specifically, comments are
requested on the following topics:
• Whether the rules for the use of for­
feitures in defined benefit and defined
contribution plans can be further sim­
plified to reduce administrative costs
and burdens; and
• Whether any issues arise concern­
ing other unallocated amounts (in
addition to forfeitures) with respect
to qualified retirement plans, and,
if issues do arise, whether guidance
should be provided addressing those
issues.
All comments will be available for pub­
lic inspection and copying at www.reg­
ulations.gov or upon request. A public
hearing will be scheduled if requested in
writing by any person who timely submits
written comments. If a public hearing is
scheduled, notice of the date, time, and
place of the public hearing will be pub­
lished in the Federal Register.
Drafting Information
The principal author of these proposed
regulations is Brandon Ford, Office of
Associate Chief Counsel (Employee Ben­
efits, Exempt Organizations, and Employ­
ment Taxes). However, other personnel
from the Treasury Department and the
IRS participated in the development of
these regulations.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and record­
keeping requirements.
Proposed Amendments to the
Regulations
Accordingly, the Treasury De­
partment and the 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 * * *
§1.401-1 [Amended]
Par. 2. Section 1.401­1 is amended by
removing the fourth sentence of paragraph
(b)(1)(i).
Par. 3. Section 1.401­7 is revised to
read as follows:
§1.401-7 Forfeitures under a qualified
retirement plan.
(a) Forfeitures under a qualified de-
fined benefit plan. In the case of a trust
forming a part of a qualified defined ben­
efit plan (as described in section 414(j)),
the plan must expressly provide that for­
feitures may not be applied to increase
the benefits any employee would other­
wise receive under the plan at any time
prior to the termination of the plan or the
complete discontinuance of employer
contributions thereunder. However, the
effect of forfeitures may be anticipated
in determining the costs under the plan.
See sections 430(h)(1), 431(c)(3), and
433(c)(3), as applicable, regarding the
use of reasonable actuarial assumptions
in determining the amount of contribu­
tions required to be made under a plan to
which one of those sections applies.
(b) Forfeitures under a qualified defined
contribution plan. In the case of a trust
forming a part of a qualified defined con­
tribution plan (as described in section
414(i)) that provides for forfeitures, the
plan must provide that—
(1) Forfeitures will be used for one or
more of the following purposes—
(i) To pay plan administrative expenses;
(ii) To reduce employer contributions
under the plan; or
(iii) To increase benefits in other partic­
ipants’ accounts in accordance with plan
terms; and
(2) Forfeitures will be used no later
than 12 months following the close of the
plan year in which the forfeitures were in­
curred under plan terms.
(c) Transition rule for forfeitures in-
curred during plan years beginning before
January 1, 2024. For purposes of para­
graph (b)(2) of this section, forfeitures
incurred during any plan year that begins
before January 1, 2024, will be treated as
having been incurred in the first plan year
that begins on or after January 1, 2024.
(d) Applicability date. This section ap­
plies for plan years beginning on or after
January 1, 2024.
Melanie R. Krause,
Acting Deputy Commissioner for
Services and Enforcement.
(Filed by the Office of the Federal Register Febru­
ary 24, 2023, 8:45a.m., and published in the issue of
the Federal Register for February 27, 2023, 88 FR
12282)

Bulletin No. 2023–11 i March 13, 2023
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 ap­
plied 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 be­
ing made clear because the language has
caused, or may cause, some confusion. It
is not used where a position in a prior rul­
ing 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 previous­
ly 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 rulings
will not be applied pending some future
action such as the issuance of new or
amended regulations, the outcome of cas­
es in litigation, or the outcome of a Ser­
vice 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.

March 13, 2023 ii Bulletin No. 2023–11
Numerical Finding List
1
Bulletin 2023–11
Announcements:
2023­2, 2023­2 I.R.B. 344
2023­1, 2023­3 I.R.B. 422
2023­3, 2023­5 I.R.B. 447
2023­4, 2023­7 I.R.B. 470
2023­5, 2023­9 I.R.B. 499
2023­6, 2023­9 I.R.B. 501
AOD:
2023­1, 2023­10 I.R.B. 502
2023­2, 2023­11 I.R.B. 529
Notices:
2023­4, 2023­2 I.R.B. 321
2023­5, 2023­2 I.R.B. 324
2023­6, 2023­2 I.R.B. 328
2023­8, 2023­2 I.R.B. 341
2023­1, 2023­3 I.R.B. 373
2023­2, 2023­3 I.R.B. 374
2023­3, 2023­3 I.R.B. 388
2023­7, 2023­3 I.R.B. 390
2023­9, 2023­3 I.R.B. 402
2023­10, 2023­3 I.R.B. 403
2023­11, 2023­3 I.R.B. 404
2023­12, 2023­6 I.R.B. 450
2023­13, 2023­6 I.R.B. 454
2023­16, 2023­8 I.R.B. 479
2023­17, 2023­10 I.R.B. 505
2023­18, 2023­10 I.R.B. 508
2023­20, 2023­10 I.R.B. 523
2023­19, 2023­11 I.R.B. 560
2023­21, 2023­11 I.R.B. 563
Proposed Regulations:
REG­100442­22, 2023­3 I.R.B. 423
REG­146537­06, 2023­3 I.R.B. 436
REG­114666­22, 2023­4 I.R.B. 437
REG 122286­18, 2023­11 I.R.B. 565
Revenue Procedures:
2023­1, 2023­1 I.R.B. 1
2023­2, 2023­1 I.R.B. 120
2023­3, 2023­1 I.R.B. 144
2023­4, 2023­1 I.R.B. 162
2023­5, 2023­1 I.R.B. 265
2023­7, 2023­1 I.R.B. 305
2023­8, 2023­3 I.R.B. 407
2023­10, 2023­3 I.R.B. 411
2023­11, 2023­3 I.R.B. 417
2023­14, 2023­6 I.R.B. 466
2023­9, 2023­7 I.R.B. 471
Revenue Rulings:
2023­1, 2023­2 I.R.B. 309
2023­3, 2023­6 I.R.B. 448
2023­4, 2023­9 I.R.B. 480
2023­5, 2023­10 I.R.B. 503
Treasury Decisions:
9970, 2023­2 I.R.B. 311
9771, 2023­3 I.R.B. 346
9772, 2023­11 I.R.B. 530
9773, 2023­11 I.R.B. 557
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2022–27 through 2022–52 is in Internal Revenue Bulletin
2022–52, dated December 27, 2022.

Bulletin No. 2023–11 iii March 13, 2023
Finding List of Current Actions on
Previously Published Items
1
Bulletin 2023–11
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2022–27 through 2022–52 is in Internal Revenue Bulletin
2022–52, dated December 27, 2022.

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