n-22-30.pdf

Preserve advance releases and the authoritative Internal Revenue Bulletin rendition; directory timestamps are file-publication metadata, not legal effective dates. HTML bulletins begin June 2003; earlier available issues require full PDF parsing.

This collection currently includes the publisher’s available advance-release directory. Historical bulletin renditions are discovered separately; an advance-release record alone does not certify the collection archive complete.

Section 59A Qualified Derivative Payments Reporting Extension

Notice 2022-30

I. PURPOSE
This Notice announces that the Department of the Treasury (“Treasury
Department”) and the Internal Revenue Service (“IRS”) intend to amend the regulations
under sections 59A and 6038A to defer the applicability date of certain provisions of the
regulations relating to the reporting of qualified derivative payments (“QDP”) until
taxable years beginning on or after January 1, 2025.
II. BACKGROUND
On December 6, 2019, the Treasury Department and the IRS published TD 9885
in the Federal Register (84 FR 66968), which contains final regulations addressing the
base erosion and anti-abuse tax (“BEAT”) of section 59A (the “2019 final regulations”).
The 2019 final regulations generally apply to taxable years ending on or after December
17, 2018. The 2019 final regulations included rules under sections 59A and 6038A
addressing the reporting of QDPs, which are not base erosion payments.
Under §1.59A-6(b)(2)(i), a payment does not qualify as a QDP unless the

taxpayer reports the information required in §1.6038A-2(b)(7)(ix) for the taxable year.
Section 1.6038A-2(b)(7)(ix) requires a taxpayer subject to the BEAT to report on Form
8991 the aggregate amount of QDPs for the taxable year and make a representation
that all payments satisfy the requirements of §1.59A-6(b)(2). If a taxpayer fails to satisfy
the reporting requirements of §1.59A-6(b)(2)(i) with respect to any payments, §1.59A-
6(b)(2)(ii) (the reporting failure exclusion) provides that those payments are not eligible
for the QDP exception described in §1.59A-3(b)(3)(ii) and are base erosion payments
unless another exception applies.
Section 1.6038A-2(b)(7)(ix) applies to taxable years beginning on or after June 7,
2021. Section 1.6038A-2(g). Before §1.6038A-2(b)(7)(ix) is applicable (the “transition
period”), a taxpayer is treated as satisfying the QDP reporting requirements to the
extent that the taxpayer reports the aggregate amount of QDPs on Form 8991,
Schedule A, provided that the taxpayer reports this amount in good faith. See §1.59A-
6(b)(2)(iv) and §1.6038A-2(g).
In Notice 2021-36, 2021-26 I.R.B. 1227, the Treasury Department and the IRS
announced the intention to extend the transition period through taxable years beginning
before January 1, 2023, while the Treasury Department and the IRS study the
interaction of the QDP exception, the BEAT netting rule in §1.59A-2(e)(3)(vi), and the
QDP reporting requirements in §§1.59A-6 and 1.6038A-2(b)(7)(ix). The Treasury
Department and the IRS have not yet issued regulations amending the applicability date
of §1.6038A-2(g). The Treasury Department and the IRS continue to study these
provisions and have determined that it is appropriate to further extend the transition

period.
III. AMENDED APPLICABILITY DATE
The Treasury Department and the IRS intend to amend §1.6038A-2(g) to provide
that §1.6038A-2(b)(7)(ix) will apply to taxable years beginning on or after January 1,
2025. Until §1.6038A-2(b)(7)(ix) applies, the rules described in §1.59A-6(b)(2)(iv) that
apply during the transition period will continue to apply.
IV. TAXPAYER RELIANCE
Taxpayers may rely on the provisions of this Notice before the issuance of the
amendments to the final regulations described in section III of this Notice.
V. EFFECT ON OTHER DOCUMENTS
Notice 2021-36 is modified, and as so modified, is superseded.
VI. DRAFTING INFORMATION
The principal author of this Notice is Sheila Ramaswamy of the Office of
Associate Chief Counsel (International). For further information regarding this notice
contact Sheila Ramaswamy at (202) 317-6938 (not a toll-free call).