Internal Revenue Bulletin 1997-23 (PDF rendition): IRS Revenue Rulings

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. Whole bulletin rendition: numbered items are identified below; other legal material and publisher context remain included. This is not a new standalone advance release.

INCOME TAX
Rev. Rul. 97–25, page 4.
Low-income housing credit; satisfactory bond; ‘‘bond
factor’’ amounts for the period April through June
1997.This ruling announces the monthly bond factor
amounts to be used by taxpayers who dispose of
qualified low-income buildings or interests therein during
the period April through June 1997.
T.D. 8719, page 4.
REG–209837–96, page 8.
REG–105299–97, page 8.
Temporary and proposed regulations under section 446
of the Code relate to the procedure for requesting a
change in accounting method and to the standards for
granting an extension of time to request a change in
accounting method.
EXEMPT ORGANIZATIONS
Announcement 97–56, page 17.
A list is given of organizations now classified as private
foundations.
GENERATION-SKIPPING TRANSFER TAX
T.D. 8720, page 6.
Final regulations under section 2652 of the Code relate
to the generation-skipping transfer (GST) tax regulations
under Chapter 13 of the Code.
ADMINISTRATIVE
Rev. Proc. 97–28, page 9.
Tax forms and instructions.General procedures are
provided to inform those who participate in the Magnetic
Media/Electronic Filing Program for Form 1040NR, U.S.
Nonresident Alien Income Tax Return, of their obligations
to the Internal Revenue Service, taxpayers, and other
participants.
Announcement 97–57, page 18.
The 1997 Information Reporting Program Seminars will
be held in August and September. The schedule of
cities, dates, and contact telephone numbers is shown.
Finding Lists begin on page 22.
Announcement of Disbarments and Suspensions begins on page 19.
Bulletin No. 1997–23
June 9, 1997
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.

Mission of the Service
The purpose of the Internal Revenue Service is to
collect the proper amount of tax revenue at the least
cost; serve the public by continually improving the
quality of our products and services; and perform in a
manner warranting the highest degree of public
confidence in our integrity, efficiency and fairness.
Statement of Principles
of Internal Revenue
Tax Administration
The function of the Internal Revenue Service is to
administer the Internal Revenue Code. Tax policy
for raising revenue is determined by Congress.
With this in mind, it is the duty of the Service to
carry out that policy by correctly applying the laws
enacted by Congress; to determine the reasonable
meaning of various Code provisions in light of the
Congressional purpose in enacting them; and to
perform this work in a fair and impartial manner,
with neither a government nor a taxpayer point of view.
At the heart of administration is interpretation of the
Code. It is the responsibility of each person in the
Service, charged with the duty of interpreting the
law, to try to find the true meaning of the statutory
provision and not to adopt a strained construction in
the belief that he or she is ‘‘protecting the revenue.’’
The revenue is properly protected only when we as-
certain and apply the true meaning of the statute.
The Service also has the responsibility of applying
and administering the law in a reasonable,
practical manner. Issues should only be raised by
examining officers when they have merit, never
arbitrarily or for trading purposes. At the same
time, the examining officer should never hesitate
to raise a meritorious issue. It is also important
that care be exercised not to raise an issue or to
ask a court to adopt a position inconsistent with
an established Service position.
Administration should be both reasonable and
vigorous. It should be conducted with as little
delay as possible and with great courtesy and
considerateness. It should never try to overreach,
and should be reasonable within the bounds of law
and sound administration. It should, however, be
vigorous in requiring compliance with law and it
should be relentless in its attack on unreal tax
devices and fraud.
2

Introduction
The Internal Revenue Bulletin is the authoritative instru-
ment of the Commissioner of Internal Revenue for
announcing official rulings and procedures of the Inter-
nal Revenue Service and for publishing Treasury Deci-
sions, Executive Orders, Tax Conventions, legislation,
court decisions, and other items of general interest. It is
published weekly and may be obtained from the Superin-
tendent of Documents on a subscription basis. Bulletin
contents of a permanent nature are consolidated semi-
annually into Cumulative Bulletins, which are sold on a
single-copy basis.
It is the policy of the Service to publish in the Bulletin all
substantive 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 otherwise indicated. Proce-
dures relating solely to matters of internal 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 Ser-
vice on the application of the law to the pivotal facts
stated in the revenue ruling. In those based on positions
taken in rulings to taxpayers or technical advice to
Service field offices, identifying details and information
of a confidential nature are deleted to prevent unwar-
ranted 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 proce-
dures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be consid-
ered, 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 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 Administra-
tive Rulings are issued by the Department of the
Treasury’s Office of the Assistant Secretary (Enforce-
ment).
Part IV.—Items of General Interest.
With the exception of the Notice of Proposed Rulemak-
ing and the disbarment and suspension list included in
this part, none of these announcements are consoli-
dated in the Cumulative Bulletins.
The first Bulletin for each month includes an index for
the matters published during the preceding month.
These monthly indexes are cumulated on a quarterly and
semiannual basis, and are published in the first Bulletin
of the succeeding quarterly and semi-annual period,
respectively.
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.
For sale by the Superintendent of Documents U.S. Government Printing Office, Washington, D.C. 20402.
3

Part I. Rulings and Decisions Under the Internal Revenue Code of 1986
Section 42.—Low-Income Housing
Credit
Low-income housing credit; satis-
factory bond; “bond factor” amounts
for the period April through June
1997.This ruling announces the
monthly bond factor amounts to be used
by taxpayers who dispose of qualified
low-income buildings or interests therein
during the period April through June
1997.
Rev. Rul. 97–25
In Rev. Rul. 90–60, 1990–2 C.B. 3,
the Internal Revenue Service provided
guidance to taxpayers concerning the
general methodology used by the Trea-
sury Department in computing the bond
factor amounts used in calculating the
amount of bond considered satisfactory
by the Secretary under § 42(j)(6) of the
Internal Revenue Code. It further an-
nounced that the Secretary would pub-
lish in the Internal Revenue Bulletin a
table of ‘‘bond factor’’ amounts for
dispositions occurring during each cal-
endar month.
This revenue ruling provides in Table
1 the bond factor amounts for calculat-
ing the amount of bond considered
satisfactory under § 42(j)(6) for disposi-
tions of qualified low-income buildings
or interests therein during the period
April through June 1997.
Table 1
Rev. Rul. 97–25
Monthly Bond Factor Amounts for Dispositions Expressed
As a Percentage of Total Credits
Calendar Year Building Placed in Service
or, if Section 42(f)(1) Election Was Made,
the Succeeding Calendar Year
Month of
Disposition
1987 1988 1989 1990 1991 1992 1993 1994 1995 19961997
Apr ’97
May ’97
Jun ’97
79.00
78.77
78.55
81.35
81.11
80.88
83.91
83.66
83.42
86.90
86.64
86.40
90.40
90.13
89.87
94.39
94.09
93.81
98.50
98.18
97.88
102.45
102.11
101.79
106.31
105.95
105.61
110.36
109.98
109.64
112.52
112.52
112.52
For a list of bond factor amounts
applicable to dispositions occurring dur-
ing other calendar years, see the follow-
ing revenue rulings: Rev. Rul. 90–60,
1990–2 C.B. 3, for dispositions occur-
ring during calendar years 1987, 1988,
and 1989; Rev. Rul. 90–88, 1990–2 C.B.
7, for dispositions occurring during cal-
endar year 1990; Rev. Rul. 91–67,
1991–2 C.B. 13, for dispositions occur-
ring during calendar year 1991; Rev.
Rul. 92–101, 1992–2 C.B. 9, for dispo-
sitions occurring during calendar year
1992; Rev. Rul 93–83, 1993–2 C.B. 6,
for dispositions occurring during calen-
dar year 1993; Rev. Rul. 94–71, 1994–2
C.B. 4, for dispositions occurring during
calendar year 1994; Rev. Rul. 95–83,
1995–2 C.B. 8, for dispositions occur-
ring during calendar year 1995; Rev.
Rul. 96–16, 1996–1 C.B. 3, for disposi-
tions occurring during the period Janu-
ary through March 1996; Rev. Rul.
96–33, 1996–27 I.R.B. 4, for disposi-
tions occurring during the period April
through June 1996; Rev. Rul. 96–45,
1996–39 I.R.B. 5, for dispositions oc-
curring during the period July through
September 1996; Rev. Rul. 96–59,
1996–50 I.R.B. 4, for dispositions oc-
curring during the period October
through December 1996; and Rev. Rul.
97–16, 1997–13 I.R.B. 4, for disposi-
tions occurring during the period Janu-
ary through March 1997.
DRAFTING INFORMATION
The principal author of this revenue
ruling is Jack Malgeri of the Office of
Assistant Chief Counsel (Passthroughs
and Special Industries). For further in-
formation regarding this revenue ruling,
contact Mr. Malgeri at (202) 622–3040
(not a toll-free call).
Section 446.—General Rule for
Methods of Accounting
26 CFR 1.446–1: General rule for methods of
accounting.
T.D. 8719
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Parts 1, 301 and 601
Requirements Respecting the
Adoption or Change of Accounting
Method; Extensions of Time to
Make Elections
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Temporary regulations.
SUMMARY: This document contains
temporary regulations relating to the
procedure for requesting a change in
accounting method and to the standards
for granting an extension of time to
request a change in accounting method.
The regulations provide for a longer
period of time for filing an application
for change in accounting method with
the Commissioner. The regulations also
provide that an extension of time to file
an application for change in accounting
method will be granted only in unusual
and compelling circumstances. The
regulations affect taxpayers requesting a
change in method of accounting for
federal income tax purposes. The text of
these temporary regulations also serves
as the text of REG–209837–96 and
REG–105299–97, page 8.
DATES: These regulations are effective
May 15, 1997.
For dates of applicability of these
regulations, see §§ 1.446–1T(e)(3)(iii),
301.9100–1T(h) and 601.204T(e) of
these regulations.
FOR FURTHER INFORMATION CON-
TACT: Cheryl L. Oseekey at (202)
622–4970 (not a toll-free number).
SUPPLEMENTARY INFORMATION:
Background
This document contains amendments
to the Regulations on Income Taxes (26
4

CFR part 1), the Regulations on Proce-
dure and Administration (26 CFR part
301), and the Statement of Procedural
Rules (26 CFR part 601) relating to the
requirements for changes in method of
accounting and extensions of time to
make elections. Proposed and temporary
regulations relating to extensions of time
to make elections were published in the
Federal Registerfor June 27, 1996 (61
FR 29714 and 61 FR 33365). These
regulations extend the time for filing an
application for change in accounting
method under § 1.446–1(e)(3)(i) and
amend §§ 301.9100–1T and 301.9100–
3T to provide that an extension of time
to file an application for change in
accounting method beyond the year pro-
vided in these regulations will be
granted only in unusual and compelling
circumstances.
Explanation of Provisions
Section 446(e) requires that a tax-
payer obtain the Commissioner’s con-
sent before changing a method of ac-
counting. Sections 1.446–1(e)(3)(i) and
601.204(b) require the taxpayer to file a
Form 3115, Application for Change in
Accounting Method, with the Commis-
sioner within the first 180 days of the
taxable year in which the taxpayer de-
sires to make the change. Sections
301.9100–1T and 301.9100–3T provide
limited relief for extending the time to
file a Form 3115 (not to exceed 90 days
from the deadline for filing the Form
3115 except in unusual and compelling
circumstances).
Sections 1.446–1(e)(3)(i) and
601.204(b) are amended to provide that
a taxpayer must file a Form 3115 with
the Commissioner during the taxable
year in which the taxpayer desires to
make the change in method of account-
ing. Taxpayers are encouraged to file the
Form 3115 as early as possible during
the year of change to provide the IRS
adequate time to process the application
prior to the original due date of the
taxpayer’s return.
In addition, §§ 301.9100–1T and
301.9100–3T are amended to provide
that an extension of time to file a Form
3115 (i.e., beyond the taxable year) will
only be granted in unusual and compel-
ling circumstances.
These amendments are effective for
Forms 3115 filed on or after May 15,
1997.
Special Analyses
It has been determined that this Trea-
sury decision is not a significant regula-
tory action as defined in EO 12866.
Therefore, a regulatory assessment is not
required. It also has been determined
that section 553(b) of the Administrative
Procedure Act (5 U.S.C. chapter 5) does
not apply to these regulations. Sections
1.446–1(e)(3)(i) and 601.204(b) require
a taxpayer to file a Form 3115, Appli-
cation for Change in Accounting
Method, with the Commissioner within
the first 180 days of the taxable year in
which the taxpayer desires to make the
change. The temporary regulations in
this document, §§ 1.446–1T(e)(3)(i) and
601.204T(b), merely extend the time for
filing the Form 3115 and, therefore, do
not contain a new collection of informa-
tion. Thus, because the regulations do
not impose a collection of information
on small entities, the Regulatory Flex-
ibility Act (5 U.S.C. chapter 6) does not
apply. Pursuant to section 7805(f) of the
Internal Revenue Code, these temporary
regulations will be submitted to the
Chief Counsel for Advocacy of the
Small Business Administration for com-
ment on their impact on small business.
Drafting Information
The principal author of these regula-
tions is Cheryl L. Oseekey of the Office
of Assistant Chief Counsel (Income Tax
and Accounting). However, other per-
sonnel from the IRS and Treasury De-
partment participated in their develop-
ment.
* * * * *
Adoption of Amendments to the Regula-
tions
Accordingly, 26 CFR parts 1, 301,
and 601 are amended as follows:
PART 1—INCOME TAXES
Paragraph 1. The authority citation for
part 1 continues to read in part as
follows:
Authority: 26 U.S.C. 7805. * * *
Par. 2. Section 1.446–1, paragraph
(e)(3)(i) is amended by adding a sen-
tence at the end of the paragraph to read
as follows:
§ 1.446–1 General rule for methods of
accounting.
* * * * *
(e)(3) * * * For any Form 3115 filed
on or after May 15, 1997, see § 1.446–
1T(e)(3)(i)(B).
Par. 3. Section 1.446–1T is added to
read as follows:
§ 1.446–1T General rule for methods of
accounting (temporary).
(a) through (d) [Reserved] For further
guidance, see § 1.446–1(a) through (d).
(e)Requirement respecting the adop-
tion or change of accounting method.
(1) and (2) [Reserved] For further
guidance, see § 1.446–1 (e)(1) and (2).
(3)(i)(A) [Reserved] For further
guidance, see § 1.446–1(e)(3)(i).
(B) For any Form 3115 filed on or
after May 15, 1997, permission to
change a taxpayer’s method of account-
ing will not be granted unless the tax-
payer agrees to the Commissioner’s pre-
scribed terms and conditions for
effecting the change, including the tax-
able year or years in which any adjust-
ment necessary to prevent amounts from
being duplicated or omitted is to be
taken into account.
(ii) and (iii) [Reserved] For further
guidance, see § 1.446–1(e)(3) (ii) and
(iii).
PART 301—PROCEDURE AND AD-
MINISTRATION
Par. 4. The authority citation for part
301 continues to read in part as follows:
Authority: 26 U.S.C. 7805. * * *
Par. 5. In § 301.9100–1T, paragraph
(h) is amended by adding a sentence at
the end of the paragraph to read as
follows:
§ 301.9100–1T Extensions of time to
make elections (temporary).
* * * * *
(h) * * * In addition, § 301.9100–
3T(c)(2)(i) is effective for any Form
3115 filed on or after May 15, 1997.
Par. 6. In § 301.9100–3T, paragraph
(c)(2)(i) is revised to read as follows:
§ 301.9100–3T Other extensions (tem-
porary).
* * * * *
(c) * * *
(2) * * *
(i) Subject to the procedure described
in § 1.446–1T(e)(3)(i) of this chapter
(requiring the advance written consent
of the Commissioner);
* * * * *
PART 601—STATEMENT OF PROCE-
DURAL RULES
Par. 7. The authority citation for part
601 continues to read as follows:
5

Authority: 26 U.S.C. 301 and 552,
unless otherwise noted.
Par. 8. Section 601.204, paragraph (b)
is amended by adding a sentence at the
end of the paragraph to read as follows:
§ 601.204 Changes in accounting peri-
ods and in methods of accounting.
* * * * *
(b) * * * For any Form 3115 filed on
or after May 15, 1997, see § 601.204T-
(b)(2).
Par. 9. Section 601.204T is added to
read as follows:
§ 601.204T Changes in accounting peri-
ods and in methods of accounting (tem-
porary).
(a) [Reserved] For further guidance,
see § 601.204(a).
(b)Methods of accounting.(1) [Re-
served] For further guidance, see
§ 601.204(b).
(2) For any Form 3115 filed on or
after May 15, 1997, application for
permission to change the method of
accounting employed shall be made on
Form 3115 and filed with the Commis-
sioner during the taxable year in which
the taxpayer desires to make the change
in method of accounting. Permission to
change the method of accounting will
not be granted unless the taxpayer and
the Commissioner agree to the terms
and conditions under which the change
will be effected.
(c) and (d) [Reserved] For further
guidance, see § 601.204(c) and (d).
Margaret Milner Richardson,
Commissioner of Internal Revenue.
Approved May 2, 1997.
Donald C. Lubick,
Assistant Secretary of the Treasury.
(Filed by the Office of the Federal Register on
May 14, 1997, 8:45 a.m., and published in the
issue of the Federal Register for May 15, 1997, 62
F.R. 26740)
Section 2652.—Other Definitions
26 CFR 26.2652–1: Transferor defined; other
definitions.
T.D. 8720
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 26
Generation-Skipping Transfer Tax
AGENCY: Internal Revenue Service
(IRS), Treasury
ACTION: Final Regulations.
SUMMARY: This document contains
final regulations relating to the
generation-skipping transfer (GST) tax
regulations under chapter 13 of the
Internal Revenue Code (Code). This
document amends the final regulations
under section 2652 and is necessary to
provide guidance to taxpayers so that
they may comply with chapter 13 of the
Code.
DATES: This regulation is effective on
May 20, 1997.
For dates of applicability of these
regulations, seeEffective Dateunder
Supplementary Information.
FOR FURTHER INFORMATION CON-
TACT: James F. Hogan, (202) 622–3090
(not a toll-free number),
SUPPLEMENTARY INFORMATION:
Background
On December 27, 1995, the IRS pub-
lished final regulations in theFederal
Register(60 FR 66898 [T.D. 8644 C.B.
200]) under sections 2611, 2612, 2613,
2632, 2641, 2642, 2652, 2653, 2654,
and 2663. On June 12, 1996, a notice of
proposed rulemaking deleting
§ 26.2652–1(a)(4) and two related ex-
amples was published in theFederal
Register(61 FR 29714 [PS–22–96,
1996–33 I.R.B. 15]). No comments re-
sponding to the notice of proposed
rulemaking were received, and no public
hearing was requested or held. The final
regulations are adopted as proposed.
Explanation of Provision
Section 2652(a)(1) provides generally,
that the termtransferormeans—(A) in
the case of any property subject to the
tax imposed by chapter 11, the decedent,
and (B) in the case of any property
subject to the tax imposed by chapter
12, the donor. An individual is treated as
transferring any property with respect to
which the individual is the transferor.
Under § 26.2652–1(a)(2), a transfer is
subject to Federal gift tax if a gift tax is
imposed under section 2501(a) and is
subject to Federal estate tax if the value
of the property is includible in the
decedent’s gross estate determined under
section 2031 or section 2103. Under
§ 26.2652–1(a)(4), the exercise of a
power of appointment that is not a
general power of appointment is also
treated as a transfer subject to Federal
estate or gift tax by the holder of the
power if the power is exercised in a
manner that may postpone or suspend
the vesting, absolute ownership, or
power of alienation of an interest in
property for a period, measured from the
date of the creation of the trust, extend-
ing beyond any specified life in being at
the date of creation of the trust plus a
period of 21 years plus, if necessary, a
reasonable period of gestation.
The purpose of the rule in
§ 26.2652–1(a)(4) was to impose the
GST tax when it may not otherwise
have applied. It was never intended to
(nor could it) prevent the application of
the tax pursuant to the statutory provi-
sions that apply based on the original
taxable transfer. To eliminate any uncer-
tainty concerning the proper application
of the GST tax, the regulations under
section 2652(a) are clarified by eliminat-
ing § 26.2652–1(a)(4) andExample 9
andExample 10in § 26.2652–1(a)(6)
from the regulations.
Effective Date
These amendments apply to transfers
to trusts on or after June 12, 1996.
Special Analyses
It has been determined that this Trea-
sury Decision is not a significant regula-
tory action as defined in EO 12866.
Therefore, a regulatory assessment is not
required. It has also been determined
that section 553(b) of the Administrative
Procedure Act (5 U.S.C. chapter 5) does
not apply to these regulations and, be-
cause these regulations do not impose a
collection of information on small enti-
ties, the Regulatory Flexibility Act (5
U.S.C. chapter 6) does not apply. There-
fore, a Regulatory Flexibility Analysis is
not required. Pursuant to section 7805(f)
of the Internal Revenue Code, the notice
of proposed rulemaking preceding these
regulations was submitted to the Small
Business Administration for comment on
its impact on small business.
Drafting Information
The principal author of this regulation
is James F. Hogan, Office of the Chief
Counsel, IRS. Other personnel from the
IRS and Treasury Department partici-
pated in its development.
* * * * *
Amendments to the Regulations
Accordingly, 26 CFR part 26 is
amended as follows:
6

PART 26—GENERATION-SKIPPING
TRANSFER TAX REGULATIONS UN-
DER THE TAX REFORM ACT OF
1986
Paragraph 1. The authority citation for
part 26 continues to read, in part, as
follows:
Authority: 26 U.S.C. 7805 * * *
Par. 2 Section 26.2652–1 is amended
as follows:
1. Paragraph (a)(4) is removed and
paragraphs (a)(5) and (a)(6) are redesig-
nated as paragraphs (a)(4) and (a)(5),
respectively.
2. In newly designated paragraph
(a)(5),Examples 9and10are removed
andExample 11is redesignated asEx-
ample 9.
Margaret Milner Richardson,
Commissioner of Internal Revenue.
Approved May 1, 1997.
Donald C. Lubick,
Assistant Secretary of the Treasury.
(Filed by the Office of the Federal Register on
May 19, 1997, 8:45 a.m., and published in the
issue of the Federal Register for May 20, 1997, 62
F.R. 27496)
Section 6012.—Persons Required
To Make Returns of Income
26 CFR 1.6012–5: Composite return in lieu of
specified form.
General procedures are provided to inform those
who participate in the Magnetic Media/Electronic
Filing Program for Form 1040NR, of their obliga-
tions to the Internal Revenue Service, taxpayers,
and other participants. See Rev. Proc. 97–28,
page 9.
Section 6061.—Signing of Returns
and Other Documents
26 CFR 1.6061–1: Signing of returns and other
documents by individuals.
General procedures are provided to inform those
who participate in the Magnetic Media/Electronic
Filing Program for Form 1040NR, of their obliga-
tions to the Internal Revenue Service, taxpayers,
and other participants. See Rev. Proc. 97–28,
page 9.
7

Part III. Administrative, Procedural, and Miscellaneous
Notice of Proposed Rulemaking
Requirements Respecting the
Adoption or Change of Accounting
Method; Extensions of Time To
Make Elections
REG–209837–96; REG–105299–97
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Notice of proposed rulemak-
ing by cross-reference to temporary
regulations.
SUMMARY: In T.D. 8719, page 4, the
IRS is issuing temporary regulations
relating to the procedure for requesting
a change in accounting method and to
the standards for granting an extension
of time to request a change in account-
ing method. The regulations provide for
a longer period of time for filing an
application for change in accounting
method with the Commissioner. The
regulations also provide that an exten-
sion of time to file an application for
change in accounting method will be
granted only in unusual and compelling
circumstances. The regulations affect
taxpayers requesting a change in method
of accounting for federal income tax
purposes. The text of those temporary
regulations also serves as the text of
these proposed regulations.
DATES: Written comments must be re-
ceived by August 13, 1997.
ADDRESSES: Send submissions to:
CC:DOM:CORP:R (REG–209837–96
and REG–105299–97), room 5228, In-
ternal Revenue Service, POB 7604, Ben
Franklin Station, Washington, DC
20044. Submissions may be hand deliv-
ered between the hours of 8 a.m. and 5
p.m. to: CC:DOM:CORP:R (REG–
209837–96 and REG–105299–97), Cou-
rier’s Desk, Internal Revenue Service,
1111 Constitution Avenue NW, Washing-
ton, DC. Taxpayers may also submit
comments electronically via the internet
by selecting the ‘‘Tax Regs’’ option on
the IRS Home Page, or by submitting
comments directly to the IRS internet
site at http://www.irs.ustreas.gov/prod/
tax_regs/comments.html.
FOR FURTHER INFORMATION CON-
TACT: Cheryl L. Oseekey, (202) 622–
4970 (not a toll-free number).
SUPPLEMENTARY INFORMATION:
Background
Temporary regulations T.D. 8719
amend Regulations on Income Taxes (26
CFR part 1), the Regulations on Proce-
dure and Administration (26 CFR part
301), and the Statement of Procedural
Rules (26 CFR part 601) relating to the
requirements for changes in method of
accounting and extensions of time to
make elections. Proposed and temporary
regulations relating to extensions of time
to make elections were published in the
Federal Registerfor June 27, 1996 (61
FR 29714 and 61 FR 33365). These
regulations extend the time for filing an
application for change in accounting
method under § 1.446–1(e)(3)(i) and
amend §§ 301.9100–1T and 301.9100–
3T to provide that an extension of time
to file an application for change in
accounting method will be granted only
in unusual and compelling circum-
stances.
The text of those temporary regula-
tions also serves as the text of these
proposed regulations. The preamble to
the temporary regulations explains the
rules provided by the regulations.
Special Analyses
It has been determined that this notice
of proposed rulemaking is not a signifi-
cant regulatory action as defined in EO
12866. Therefore, a regulatory assess-
ment is not required. It also has been
determined that section 553(b) of the
Administrative Procedure Act (5 U.S.C.
chapter 5) does not apply to these
regulations. Sections 1.446–1(e)(3)(i)
and 601.204(b) require a taxpayer to file
a Form 3115, Application for Change in
Accounting Method, with the Commis-
sioner within the first 180 days of the
taxable year in which the taxpayer de-
sires to make the change. The proposed
regulations in this document merely ex-
tend the time for filing the Form 3115
and, therefore, do not contain a new
collection of information. Thus, because
the regulations do not impose a collec-
tion of information on small entities, the
Regulatory Flexibility Act (5 U.S.C.
chapter 6) does not apply. Pursuant to
section 7805(f) of the Internal Revenue
Code, this notice of proposed rulemak-
ing will be submitted to the Chief
Counsel for Advocacy of the Small
Business Administration for comment on
its impact on small business.
Comments and Public Hearing
Before these proposed regulations are
adopted as final regulations, consider-
ation will be given to any comments
that are submitted timely to the IRS (a
signed original and eight (8) copies if
the comments are written). All com-
ments will be available for public in-
spection and copy. A public hearing may
be scheduled if requested in writing by
a person that timely submits comments.
If a public hearing is scheduled, notice
of the date, time, and place for the
hearing will be published in theFederal
Register.
Drafting Information
The principal author of these regula-
tions is Cheryl L. Oseekey of the Office
of Assistant Chief Counsel (Income Tax
and Accounting). However, other per-
sonnel from the IRS and Treasury De-
partment participated in their develop-
ment.
* * * * *
Proposed Amendments to the Regula-
tions
Accordingly, 26 CFR parts 1, 301,
and 601 are proposed to be amended as
follows:
PART 1—INCOME TAXES
Paragraph 1. The authority citation for
part 1 continues to read in part as
follows:
Authority: 26 U.S.C. 7805. * * *
Par. 2. Section 1.446–1 is amended by
revising paragraph (e)(3)(i) to read as
follows:
§ 1.446–1 General rule for methods of
accounting.
[The text of proposed paragraph
(e)(3)(i) is the same as the text in
§ 1.446–1T(e)(3)(i) published in T.D.
8719.]
PART 301—PROCEDURE AND AD-
MINISTRATION
Par. 3. The authority citation for part
301 continues to read in part as follows:
Authority: 26 U.S.C. 7805. * * *
Par. 4. In § 301.9100–1, paragraph
(h) is added to read as follows:
§ 301.9100–1 Extensions of time to
make elections.
[The text of proposed paragraph (h) is
the same as the text of § 301.9100–
8

1T(h) published June 27, 1996, at 61 FR
33368, and amended in T.D. 8719.]
Par. 5. In proposed § 301.9100–3,
published June 27, 1996, at 61 FR
33409, paragraph (c)(2)(i) is revised to
reads as follows:
§ 301.9100–3 Other extensions.
[The text of proposed paragraph
(c)(2)(i) is the same as the text in
§ 301.9100–3T(c)(2)(i) published in
T.D. 8719.]
PART 601—STATEMENT OF PROCE-
DURAL RULES
Par. 6. The authority citation for part
601 continues to read as follows:
Authority: 26 U.S.C. 301 and 552.
* * *
Par. 7. In § 601.204, paragraph (b) is
revised to read as follows:
§ 601.204 Changes in accounting peri-
ods and in methods of accounting.
[The text of proposed paragraph (b) is
the same as the text in § 601.204T(b)
published in T.D. 8719.]
Margaret Milner Richardson,
Commissioner of Internal Revenue.
(Filed by the Office of the Federal Register on
May 14, 1997, 8:45 a.m., and published in the
issue of the Federal Register for May 15, 1997, 62
F.R. 26755)
26 CFR 601.602 : Tax forms and instructions.
(Also Part I, §§ 6012, 6061; 1.6012–5, 1.6061–1.)
Rev. Proc. 97–28
CONTENTS
SECTION 1. PURPOSE
SECTION 2. BACKGROUND AND
CHANGES
SECTION 3. 1040NR PROGRAM
PARTICIPANTS—DEFINITIONS
SECTION 4. ACCEPTANCE INTO
THE 1040NR PROGRAM
SECTION 5. RESPONSIBILITIES OF
A 1040NR FILER
SECTION 6. PENALTIES
SECTION 7. FORM 8453–NR, U.S.
NONRESIDENT ALIEN INCOME
TAX DECLARATION FOR MAG-
NETIC MEDIA FILING
SECTION 8. INFORMATION A
1040NR FILER MUST PROVIDE
TO THE TAXPAYER
SECTION 9. DIRECT DEPOSIT OF
REFUNDS
SECTION 10. BALANCE DUE RE-
TURNS
SECTION 11. ADVERTISING STAN-
DARDS FOR 1040NR FILERS AND
FINANCIAL INSTITUTIONS
SECTION 12. MONITORING AND
SUSPENSION OF A 1040NR FILER
SECTION 13. ADMINISTRATIVE RE-
VIEW PROCESS FOR DENIAL OF
PARTICIPATION IN THE 1040NR
PROGRAM
SECTION 14. ADMINISTRATIVE RE-
VIEW PROCESS FOR SUSPEN-
SION FROM THE 1040NR PRO-
GRAM
SECTION 15. EFFECT ON OTHER
DOCUMENTS
SECTION 16. EFFECTIVE DATE
SECTION 17. PROJECT OFFICE IN-
FORMATION
SECTION 1. PURPOSE
This revenue procedure informs those
who participate in the 1997 Magnetic
Media/Electronic Filing Program for
Form 1040NR, U.S. Nonresident Alien
Income Tax Return (‘‘1040NR Pro-
gram’’), of their obligations to the Inter-
nal Revenue Service, taxpayers, and
other participants. This revenue proce-
dure updates Rev. Proc. 96–35, 1996–1
C.B. 721.
SECTION 2. BACKGROUND AND
CHANGES
.01 Section 1.6012–5 of the Income
Tax Regulations provides that the Com-
missioner may authorize the use, at the
option of a person required to make a
return, of a composite return in lieu of
any form specified in 26 CFR Part 1
(Income Tax), subject to the conditions,
limitations, and special rules governing
the preparation, execution, filing, and
correction thereof as the Commissioner
may deem appropriate.
.02 For purposes of this revenue pro-
cedure, a magnetically or electronically
filed Form 1040NR is a composite re-
turn consisting of data submitted on
magnetic tape, floppy disk, or via mo-
dem (the ‘‘data portion’’), and certain
paper documents (the ‘‘paper portion’’).
The paper portion of the return consists
of a Form 8453–NR, U.S. Nonresident
Alien Income Tax Declaration for Mag-
netic Media Filing, and other paper
documents that cannot be filed magneti-
cally or electronically. Form 8453–NR
must be received by the Service before
any composite return is complete (see
section 5.07 of this revenue procedure).
A composite return must contain the
same information that a return filed
completely on paper contains. See sec-
tion 7 of this revenue procedure for
procedures for completing Form 8453–
NR.
.03 The Magnetic Media Project Of-
fice (‘‘Project Office’’, see section 17 of
this revenue procedure for the address
and telephone numbers) will periodically
issue a list of the forms and schedules
that can be magnetically or electroni-
cally filed.
.04 A Form 1040NR with a zero
balance, balance due, or refund due may
be magnetically or electronically filed.
.05 A Form 1040NR cannot be filed
magnetically or electronically after De-
cember 5, 1997, notwithstanding the fact
that the taxpayer has been granted an
extension to file beyond that date. Form
2688, Application for Additional Exten-
sion of Time To File U.S. Individual
Income Tax Return, cannot be filed
magnetically or electronically.
.06 An amended tax return cannot be
filed magnetically or electronically. A
taxpayer must file an amended tax re-
turn on paper in accordance with the
instructions for Form 1040X, Amended
U.S. Individual Income Tax Return.
.07 Upon request, the Project Office
will provide technical information (file
specifications, record layouts, and test-
ing procedures) for filing Form 1040NR
magnetically or electronically.
.08 This revenue procedure updates
Rev. Proc. 96–35, which applied to the
1040NR Program for the 1996 filing
season. The updates include changes in
the 1040NR Program for the 1997 filing
season, clarifications of prior 1040NR
Program statements, and additional guid-
ance derived from other Service docu-
ments that relate to the 1040NR Pro-
gram. Some of the updates are:
(1) a Service Bureau may submit
returns directly to the Service (section
3.02);
(2) in certain circumstances, a let-
ter may be submitted in lieu of a revised
Form MAR–8980 (section 4.03);
(3) a nonparticipating 1040NR
Filer may be dropped from the 1040NR
Program (section 4.06);
(4) a 1040NR Filer may not base a
fee for the magnetic or electronic trans-
mission of a Form 1040NR using any
amount from the return (section 5.04);
(5) the time period for a 1040NR
Filer to notify the Service that it is
discontinuing its participation in the
1040NR Program is extended to 30 days
(section 5.06);
9

(6) the duties of a 1040NR Return
Originator are clarified (sections 5.11,
5.12, 5.13, and 5.14);
(7) the duties of a 1040NR Trans-
mitter are clarified (section 5.17);
(8) a 1040NR Filer, financial insti-
tution, or any other entity associated
with the magnetic or electronic filing of
a return must not put its address on
Form 8453–NR or anywhere in the data
portion of the return (section 7.01);
(9) procedures for corrections to
Form 8453–NR are clarified (section
7.02);
(10) a 1040NR Return Originator
must advise taxpayers that refund status
information is available on TeleTax (sec-
tion 8.05);
(11) information a 1040NR Filer
must provide regarding a taxpayer’s ad-
dress of record is clarified (section
8.06);
(12) information a 1040NR Return
Originator must provide regarding direct
deposit is clarified (section 9.04);
(13) the two-year periods for de-
nial and suspension are modified and
clarified (sections 12.07 and 12.08);
(14) the time and method to re-
spond to a proposed letter of denial and
a denial letter are clarified (sections
13.03 and 13.06); and
(15) the time and method to re-
spond to a proposed suspension letter
and a suspension letter are clarified
(sections 14.02 and 14.05).
SECTION 3. 1040NR PROGRAM
PARTICIPANTS—DEFINITIONS
.01 After acceptance into the 1040NR
Program, as described in section 4 of
this revenue procedure, a participant is
referred to as a ‘‘1040NR Filer.’’
.02 A 1040NR Filer is categorized as
follows:
(1) 1040NR RETURN ORIGINA-
TOR. A ‘‘1040NR Return Originator’’
is: (a) a ‘‘1040NR Return Preparer’’
who prepares tax returns, including
Forms 8453–NR, for taxpayers who in-
tend to have their returns magnetically
or electronically filed; and/or (b) a
‘‘1040NR Return Collector’’ who ac-
cepts completed tax returns, including
Forms 8453–NR, from taxpayers who
intend to have their returns magnetically
or electronically filed.
(2) SERVICE BUREAU. A ‘‘Ser-
vice Bureau’’ receives tax return infor-
mation on any media from a 1040NR
Return Originator, formats the return
information, and either (a) sends back
the return information to the 1040NR
Return Originator, (b) forwards the re-
turn information to a Transmitter, or (c)
submits the composite tax return directly
to the Service.
(3) SOFTWARE DEVELOPER. A
‘‘Software Developer’’ develops soft-
ware for the purposes of (a) formatting
returns according to the Service’s mag-
netic or electronic return filing specifi-
cations; and/or (b) filing returns mag-
netically or electronically directly with
the Service. A Software Developer may
also sell its software.
(4) TRANSMITTER. A ‘‘Transmit-
ter’’ accepts a 1040NR composite tax
return from a 1040NR Return Originator
or Service Bureau and submits the re-
turn directly to the Service.
.03 The 1040NR Filer categories are
not mutually exclusive. For example, a
1040NR Return Originator can, at the
same time, be considered a Transmitter,
Software Developer, or Service Bureau
depending on the function(s) performed.
SECTION 4. ACCEPTANCE INTO
THE 1040NR PROGRAM
.01 Except as provided in sections
4.02 and 4.03 of this revenue procedure,
a 1040NR Filer that has actively partici-
pated in the 1996 1040NR Program
does not have to reapply to participate
in the 1997 1040NR Program. (See
section 4.06 of this revenue procedure
for a definition of active participation.)
However, a 1040NR Filer that intends to
function as a Transmitter or a Software
Developer in the 1997 1040NR Program
must first successfully complete the test-
ing described in section 4.04 of this
revenue procedure. In addition, section
4.05 of this revenue procedure provides
for the Service’s issuance of credentials
necessary for participation in the 1997
1040NR Program.
.02 Applicants and 1040NR Filers
must file a new Form MAR–8980, Ap-
plication for Electronic/Magnetic Media
Filing of Form 1040NR, with the
Project Office if:
(1) the applicant has never actively
participated in the 1040NR Program;
(2) the applicant has previously
been denied participation in the 1040NR
Program; or
(3) the applicant has been sus-
pended from the 1040NR Program. Ap-
plications described in this section 4.02
may be submitted at any time during the
year.
.03 To participate in the 1997
1040NR Program, a 1040NR Filer in the
1996 1040NR Program must submit to
the Project Office either a revised Form
MAR–8980, or a letter containing the
same information contained in the re-
vised Form MAR–8980, if there is any
change to the following information:
(1) the Firm name or Doing Busi-
ness As (DBA) name;
(2) the business or mailing address;
(3) the contact person’s name or
telephone number; or
(4) the 1040NR Filer category.
Revised applications described in this
section 4.03 must be submitted within
30 days of the change(s) reflected on
the revised Form MAR–8980 or in the
letter.
.04 A 1040NR Filer may not submit
tax returns under the 1040NR Program
until 30 days after it has successfully
completed the necessary testing adminis-
tered by the Project Office.
.05 The Service will issue credentials
to eligible applicants for the 1997
1040NR Program, as well as 1040NR
Filers that do not have to reapply pursu-
ant to section 4.01, 4.02, or 4.03 of this
revenue procedure (provided they have
first satisfactorily completed the testing
described in section 4.04 of this revenue
procedure if they intend to function as a
Transmitter or Software Developer). No
one may participate in the 1040NR
Program for the 1997 filing season
without the following credentials:
(1) a letter of acceptance into the
1040NR Program for the 1997 filing
season; and
(2) a Magnetic Tape 1040NR Filer
Identification Number (MTFIN).
.06 A 1040NR Filer will not be con-
sidered to have actively participated in
the 1996 1040NR Program unless the
Service received and accepted magneti-
cally or electronically filed returns con-
taining the 1040NR Filer’s MTFIN dur-
ing the 1996 filing season. The Service
will notify an inactive 1040NR Filer
that it may be dropped from the
1040NR Filing Program and explain
what steps the 1040NR Filer needs to
take to participate in the program.
.07 The following reasons may result
in rejection of an application to partici-
pate in the 1040NR Program (this list is
not all-inclusive):
(1) conviction of any criminal of-
fense under the revenue laws of the
United States, or of any offense involv-
ing dishonesty or breach of trust;
(2) failure to timely and accurately
file tax returns, including returns indi-
cating that no tax is due;
(3) failure to timely pay any tax
liabilities;
10

(4) assessment of tax penalties;
(5) suspension/disbarment from
practice before the Service;
(6) other facts or conduct of a
disreputable nature that would reflect
adversely on the 1040NR Program;
(7) misrepresentation on an appli-
cation;
(8) suspension or rejection from
the 1040NR Program in a prior year;
(9) unethical practices in return
preparation;
(10) stockpiling returns prior to of-
ficial acceptance into the 1040NR Pro-
gram (see section 5.10 of this revenue
procedure);
(11) knowingly and directly or in-
directly employing or accepting assis-
tance from any firm, organization, or
individual that is prohibited from apply-
ing to participate in the 1040NR Pro-
gram (see section 12.07 of this revenue
procedure) or that is suspended from
participating in that Program (see sec-
tion 12.08 of this revenue procedure).
This includes any individual whose ac-
tions resulted in the rejection or suspen-
sion of a corporation or a partnership
from the 1040NR Program; or
(12) knowingly and directly or in-
directly accepting employment as an
associate, correspondent, or as a sub-
agent from, or sharing fees with, any
firm, organization, or individual that is
prohibited from applying to participate
in the 1040NR Program (see section
12.07 of this revenue procedure) or that
is suspended from participating in that
Program (see section 12.08 of this rev-
enue procedure). This includes any indi-
vidual whose actions resulted in the
rejection or suspension of a corporation
or a partnership from the 1040NR Pro-
gram.
SECTION 5. RESPONSIBILITIES OF
A 1040NR FILER
.01 To ensure that complete returns
are accurately and efficiently filed, a
1040NR Filer must comply with all
publications and notices of the Service.
Currently, these publications and notices
include:
(1) Procedures for Magnetic Media
Filing of U.S. Nonresident Alien Income
Tax Returns, Form 1040NR (available
from the Project Office);
(2) File Specifications and Record
Layouts for Magnetic Media Filing of
U.S. Nonresident Alien Income Tax Re-
turns, Form 1040NR (available from the
Project Office); and
(3) Postings to the Electronic Fil-
ing System Bulletin Board (EFS Bulle-
tin Board).
.02 A 1040NR Filer must maintain a
high degree of integrity, compliance,
and accuracy.
.03 A 1040NR Filer may accept re-
turns for magnetic or electronic filing
only from a taxpayer or from a 1040NR
Return Originator.
.04 If a 1040NR Filer charges a fee
for the submission of a magnetically or
electronically filed tax return, the fee
may not be based on a percentage of the
refund amount or any other amount
from the tax return. A 1040NR Filer
may not charge a separate fee for Direct
Deposit. See section 9 of this revenue
procedure for a discussion of Direct
Deposit.
.05 A 1040NR Filer must submit a
revised Form MAR–8980 to the Project
Office within 30 days of when any of
the conditions or changes described in
section 4.03 of this revenue procedure
occur.
.06 A 1040NR Filer must notify the
Project Office within 30 days of discon-
tinuing its participation in the 1040NR
Program. This does not preclude reappli-
cation in the future.
.07 A 1040NR Filer must ensure that
the composite return is filed on or
before the due date of the tax return. A
composite return is not considered filed
until the data portion of the tax return is
acknowledged by the Service as ac-
cepted for processing and a completed
and signed Form 8453–NR is received
by the Service. However, if the data
portion of a return is successfully trans-
mitted on or shortly before the due date
(see section 5.08 of this revenue proce-
dure) and the 1040NR Filer complies
with section 7.01 of this revenue proce-
dure, the return will be deemed timely
filed. If the data portion of a return is
transmitted on or shortly before the due
date but is ultimately rejected, the return
will be deemed timely filed if the
1040NR Filer and the taxpayer comply
with section 5.14 of this revenue proce-
dure. In the case of a balance due
return, see section 10 of this revenue
procedure for instructions on how to
make a timely payment of tax.
.08 A 1040NR Filer must ensure that
the return for any individual is received
by the Service on or before:
(1) April 15 if the individual was
an employee and received wages subject
to U.S. federal income tax withholding;
or
(2) June 16 if the individual did
not receive such wages. However, sec-
tion 2.05 of this revenue procedure
provides that a composite return cannot
be filed after December 5, 1997.
.09 A 1040NR Filer must ensure
against the unauthorized use of its
MTFIN. A 1040NR Filer must not trans-
fer its MTFIN by sale, merger, loan,
gift, or otherwise to another entity.
.10 A 1040NR Filer is responsible for
ensuring that stockpiling does not occur.
Prior to official acceptance of the
1040NR Filer into the 1040NR Program,
stockpiling means collecting returns
from taxpayers. After official accep-
tance, stockpiling means:
(1) in the case of a 1040NR Return
Originator, waiting for more than three
calendar days after receiving the neces-
sary information to submit a return to a
Transmitter, or
(2) in the case of a Transmitter,
waiting for more than ten calendar days
after receiving the necessary information
to submit a composite return to the
Service.
.11 A 1040NR Filer that functions as
a Return Originator must:
(1) comply with the procedures for
completing Form 8453–NR described in
section 7 of this revenue procedure;
(2) comply with the procedures de-
scribed in section 10 of this revenue
procedure for handling a balance due
return;
(3) furnish the taxpayer with a
copy of the signed Form 8453–NR and,
in the case of a prepared or corrected
return, a copy of the paper portions of
the return;
(4) while returns are being filed,
retain and, if requested, make available
to the Service the following material at
the business address from which a re-
turn was accepted for magnetic or elec-
tronic filing:
(a) a copy of the signed Form
8453–NR, paper copies of Forms W–2,
Wage and Tax Statement, W–2G, Cer-
tain Gambling Winnings, 1099–R, Dis-
tributions From Pensions, Annuities, Re-
tirement or Profit Sharing Plans, IRAs,
Insurance Contracts, etc., and the paper
portion of the taxpayer’s return;
(b) a complete copy of the data
portion of the taxpayer’s return (may be
retained on computer media) that can be
readily and accurately converted into
magnetic or electronic data that the
Service can process; and
(c) the acknowledgement file re-
ceived from the Service or from a
Transmitter;
11

(5) retain until the end of the cal-
endar year in which a return was filed
and, if requested, make available to the
Service the materials described in sec-
tion 5.11(4) of this revenue procedure,
at the business address from which a
return was accepted for magnetic or
electronic filing or from the contact
person named on Form MAR–8980.
.12 A 1040NR Return Originator who
is the paid preparer of a magnetically or
electronically filed Form 1040NR must
also retain for the prescribed amount of
time the materials described in
§ 1.6107–1(b) that are required to be
kept by an income tax return preparer.
.13 A 1040NR Return Originator must
identify the paid preparer (if any) in the
appropriate field of the data portion of
the return, in addition to ensuring that
the paid preparer signed Form 8453–
NR. If Form 8453–NR is not signed by
the paid preparer, the 1040NR Return
Originator must attach a copy of the
Form 1040NR originally signed by the
paid preparer. This copy must be
marked ‘‘COPY-DO NOT PROCESS’’
to prevent duplicate filings.
.14 If the data portion of a taxpayer’s
return is acknowledged as rejected by
the Service, and the reason for the
rejection cannot be rectified by making
nonsubstantive changes as described in
section 6.02(3) of this revenue proce-
dure, the 1040NR Return Originator,
within 24 hours of receiving the rejec-
tion, must take all reasonable steps to
tell the taxpayer that the taxpayer’s
return has not been filed. If the taxpayer
chooses to have the data portion of the
return resubmitted magnetically or elec-
tronically, and the 1040NR Return
Originator successfully works with the
Project Office to correct the problems
causing the data portion of the return to
be rejected, the return will be accepted
as timely filed. A new Form 8453–NR
may be required (see section 7 of this
revenue procedure). However, even
when no new Form 8453–NR is re-
quired, the Transmitter must submit a
photocopy of the original Form
8453–NR with the rejected file or return
and mark the photocopy ‘‘Retransmit-
ted.’’ If the Project Office determines
that the data portion of a return cannot
be accepted for processing or the tax-
payer chooses not to have the rejected
data portion of the return resubmitted
magnetically or electronically, the tax-
payer must file a paper return by the
later of:
(1) the due date (with regard to
any extensions of time to file) of the
return; or
(2) within ten calendar days after
the Service’s acknowledgement that the
return is rejected or notification that the
return cannot be retransmitted with an
explanation of why the return is being
filed after the due date.
A paper return filed in good faith under
any of these circumstances will be ac-
cepted as timely filed.
.15 A 1040NR Return Originator must
use the taxpayer’s address in the data
portion of the return. In addition, a
1040NR Return Originator must not put
its address as the taxpayer’s address in
the data portion of the return.
.16 A 1040NR Filer that functions as
a Service Bureau must:
(1) deliver all data portions of
composite returns to a Transmitter or
return them to the 1040NR Return
Originator who gave the data portions of
the returns to the Service Bureau within
three calendar days of receipt;
(2) retrieve the acknowledgement
file from the Transmitter within one
calendar day of receipt by the Transmit-
ter;
(3) initiate the communication of
the acknowledgement file to the
1040NR Return Originator (whether re-
lated or not) within one work day of
retrieving the acknowledgement file;
(4) if the Service Bureau processes
Forms 8453–NR, send back to the
1040NR Return Originator any return
and Form 8453–NR that needs correc-
tion, unless the correction is described
in section 7.02(1) of this revenue proce-
dure;
(5) accept tax return information
only from 1040NR Filers;
(6) include its MTFIN and the
1040NR Return Originator’s MTFIN
with all return information the Service
Bureau sends back to the 1040NR Re-
turn Originator, forwards to a Transmit-
ter, or submits to the Service;
(7) retain each acknowledgement
file received from a Transmitter until the
end of the calendar year in which the
composite return was filed;
(8) if requested, serve as a contact
point between its client 1040NR Return
Originator and the Service; and
(9) if requested, provide the Ser-
vice with a list of each client 1040NR
Return Originator.
.17 A 1040NR Filer that functions as
a Transmitter must:
(1) transmit all data portions of
composite returns within ten calendar
days of receipt;
(2) match the acknowledgement
file to the original transmission file and
initiate the communication of the
acknowledgement file to the 1040NR
Return Originator or the Service Bureau
(whether or not the 1040NR Return
Originator or the Service Bureau are
related to the Transmitter) within five
calendar days after receipt of the
acknowledgement file from the Service;
(3) retain an acknowledgement file
received from the Service until the end
of the calendar year in which the com-
posite return was filed;
(4) immediately contact the Project
Office for further instructions if an
acknowledgement of acceptance for pro-
cessing has not been received by the
Transmitter within 14 calendar days of
transmission, or if a Transmitter receives
an acknowledgement for a return that
was not transmitted on the designated
transmission;
(5) promptly correct any transmis-
sion error that causes a data portion of a
composite return to be rejected;
(6) contact the Project Office for
assistance if a data portion of a compos-
ite return has been rejected after three
transmission attempts; and
(7) ensure the security of all trans-
mitted data.
.18 A Transmitter that provides trans-
mission services to another 1040NR
Filer must, in addition to the items
covered in section 5.17 of this revenue
procedure, also:
(1) accept composite returns for
transmission to the Service only from an
accepted 1040NR Filer;
(2) provide each client with the
acknowledgement file for the data por-
tion of the composite return within five
calendar days after receipt of the ac-
knowledgment file from the Service;
and
(3) use its assigned MTFIN when
filing returns.
.19 A 1040NR Filer that functions as
a Software Developer must:
(1) promptly correct any software
error that causes a data portion of a
composite return to be rejected;
(2) promptly distribute any soft-
ware correction made to its software
packages to all 1040NR Filers utilizing
these packages; and
(3) not incorporate into its software
a Service-assigned production password.
.20 In addition to the specific respon-
sibilities described in this section, a
12

1040NR Filer must meet all the require-
ments in this revenue procedure to keep
the privilege of participating in the
1040NR Program.
SECTION 6. PENALTIES
.01 Penalties for Disclosure or Use of
Information.
(1) A 1040NR Filer, except a Soft-
ware Developer, is a tax return preparer
(‘‘Preparer’’) under the definition of
§ 301.7216–1(b) of the Regulations on
Procedure and Administration. A
Preparer is subject to a criminal penalty
for disclosure or use of tax return
information, as described in § 301.7216–
1(a). In general, that regulation provides
that any preparer who discloses or uses
any tax return information for a purpose
other than preparing, assisting in prepar-
ing, or obtaining or providing services
in connection with the preparation of a
tax return is guilty of a misdemeanor. In
addition, § 6713 of the Internal Rev-
enue Code provides for civil penalties
that may be assessed against a preparer
who makes an unauthorized disclosure
or use of tax return information.
(2) Under § 301.7216–2(h), disclo-
sure of tax return information among
accepted 1040NR Filers for the purpose
of preparing a return is permissible. For
example, it is permissible for a 1040NR
Return Originator to pass on tax return
information to a Service Bureau and/or
a Transmitter for the purpose of having
the data portion of a composite return
formatted and filed with the Service.
However, if the tax return information is
disclosed or used in any other way, a
Service Bureau and or a Transmitter
may be guilty of a misdemeanor as
described in section 6.01(1) of this rev-
enue procedure.
.02 Other Preparer Penalties.
(1) Preparer penalties may be as-
serted against an individual or firm who
meets the definition of an income tax
return preparer under §§ 7701(a)(36)
and 301.7701–15. Examples of preparer
penalties that may be asserted under
appropriate circumstances include, but
are not limited to, those set forth in
§§ 6694, 6695, and 6713.
(2) Under § 301.7701–15(d), 1040-
NR Return Collectors, Service Bureaus,
Software Developers, and Transmitters
are not income tax return preparers for
the purpose of assessing most preparer
penalties as long as their services are
limited to ‘‘typing, reproduction, or
other mechanical assistance in the
preparation of a return or claim for
refund.’’
(3) If a 1040NR Return Collector,
Service Bureau, Software Developer, or
Transmitter alters the return information
in a nonsubstantive way, this alteration
will be considered to come under the
‘‘mechanical assistance’’ exception de-
scribed in § 301.7701–15(d)(1). A
nonsubstantive change is a correction or
change limited to a transposition error,
misplaced entry, spelling error, or arith-
metic correction that falls within one of
the following tolerances:
(a) the Total Tax amount, Total
Payments amount, Refund amount, or
the Amount You Owe shown on Form
8453–NR differs from the corresponding
amount on the data portion of the
composite return by no more than $7;
(b) the Total Effectively Con-
nected Income amount shown on Form
8453–NR differs from the corresponding
amount on the data portion of the
composite return by no more than $25;
or
(c) dropping cents and rounding
to whole dollars.
(4) If a 1040NR Return Collector,
Service Bureau, or Transmitter alters the
return information in a substantive way,
rather than having the taxpayer alter the
return, the 1040NR Return Collector,
Service Bureau, or Transmitter will be
considered to be an income tax return
preparer for purposes of § 7701(a)(36).
(5) If a 1040NR Return Collector,
Service Bureau, Transmitter, or the
product of a Software Developer, goes
beyond mechanical assistance, any of
these parties may be held liable for
income tax return preparer penalties.
Rev. Rul. 85–189, 1985–2 C.B. 341,
describes a situation where a Software
Developer was determined to be an
income tax return preparer and subject
to certain preparer penalties.
.03 In addition to the above specified
provisions, the Service reserves the right
to assert all appropriate civil and crimi-
nal penalties, including preparer,
nonpreparer, and disclosure penalties,
against a 1040NR Filer as warranted
under the circumstances.
SECTION 7. FORM 8453–NR, U.S.
NONRESIDENT ALIEN INCOME TAX
DECLARATION FOR MAGNETIC
MEDIA FILING
.01 Procedures for Completing Form
8453–NR.
(1) Form 8453–NR must be com-
pleted in accordance with the instruc-
tions for Form 8453–NR.
(2) The taxpayer’s name, address,
taxpayer identification number, tax re-
turn information, and direct deposit of
refund information in the data portion of
the composite return must be identical
to the information on the Form
8453–NR that the taxpayer signed and
provided for submission to the Service.
(3) A 1040NR Filer, a financial
institution, or any other entity associated
with the magnetic or electronic filing of
a taxpayer’s return must not put its
address on Form 8453–NR or anywhere
in the data portion of a return.
(4) After the composite return has
been prepared and before the return is
submitted, the taxpayer must verify the
information on the data portion of the
composite return and on Form 8453–
NR, and must sign Form 8453–NR.
(5) A 1040NR Filer must submit a
Form 8453–NR to the Project Office
with each magnetically or electronically
filed return. A single Form 8453–NR
(inscribed with the language ‘‘See at-
tached Multiple Return Information List-
ing’’) may be used for a multiple return
filing if the person who signs Form
8453–NR has authorization, either by a
specific power of attorney or as a
responsible representative or agent under
§ 1.6012–3(b), to sign each of the re-
turns included in the multiple return
filing. A person who makes a multiple
return filing must attach to Form
8453–NR an information page(s) titled
‘‘Form 8453–NR for Multiple Returns—
Tax Return Information Listing’’ at the
top of the pages(s). Below the title, the
multiple return 1040NR Filer must pro-
vide his or her name and address. The
next item on the page(s) must be a list
that includes every taxpayer’s name
control, taxpayer identification number,
and the information shown on lines one
through five on Form 8453–NR, for
each return included in a multiple return
filing.
(6) If a 1040NR Filer functions as
a 1040NR Return Originator, the
1040NR Filer must sign the 1040NR
Return Originator’s Declaration on Form
8453–NR.
(7) If the 1040NR Filer is also the
paid preparer, the 1040NR Filer must
check the ‘‘Paid Preparer’’ box and sign
the 1040NR Return Originator Declara-
tion on Form 8453–NR.
.02 Corrections to Form 8453–NR.
(1) A new form 8453–NR is not
required for a nonsubstantive change. A
13

nonsubstantive change is limited to a
correction that does not exceed the
tolerances, described in section 7.02(2)
of this revenue procedure for arithmetic
errors, a transposition error, a misplaced
entry, or a spelling error. The incorrect
nonsubstantive information must be
neatly lined through on the Form
8453–NR and the correct data entered
next to the lined through entry. Also the
individual making the correction must
initial the correction.
(2) The tolerances for section
7.02(1) of this revenue procedure are:
(a) the ‘‘Total Effectively Con-
nected Income’’ (Form 8453–NR, line 1)
differs from the amount on the data
portion of the composite return by more
than $25; or
(b) the ‘‘Total Tax’’ (Form
8453–NR, line 2), the ‘‘Refund’’ (Form
8453–NR, line 4), or the ‘‘Amount
Owed’’ (Form 8453–NR, line 5) differs
from the amount on the data portion of
the composite return by more than $7.
(3) If the 1040NR Return Origina-
tor makes a substantive change to the
data portion of the return after Form
8453–NR has been signed by the tax-
payer, but before it is transmitted to the
Service, the 1040NR Return Originator
must have all the necessary parties de-
scribed above sign a new Form
8453–NR that reflects the corrections
before the return is transmitted.
(4) Dropping cents and rounding to
whole dollars does not constitute a sub-
stantive change or alteration to the re-
turn unless the amount differs by more
than the above tolerances. All rounding
should be accomplished in accordance
with the instructions in the Form
1040NR tax package.
.03 If the Service determines that a
Form 8453–NR is missing, the 1040NR
Return Originator must provide the Ser-
vice with a replacement. A 1040NR
Return Originator must also provide a
copy of the Form(s) W–2, W–2G,
1099R, and all other attachments to the
Form 8453–NR.
.04 If a substitute Form 8453–NR is
used, it must be approved by the Service
prior to use. See Rev. Proc. 96–48,
1996–39 I.R.B. 10.
SECTION 8. INFORMATION A
1040NR FILER MUST PROVIDE TO
THE TAXPAYER
.01 The 1040NR Return Originator
must furnish the taxpayer with a com-
plete paper copy of the taxpayer’s re-
turn. A complete copy of the taxpayer’s
return includes: (1) Form 8453–NR and
other paper documents that cannot be
magnetically or electronically transmit-
ted, and (2) a printout of the data
portion of the composite return. See
section 2.02 of this revenue procedure.
The data portion of the composite return
can be contained on a replica of an
official form or on an unofficial form.
However, on an unofficial form, data
entries must be referenced to the line
numbers on an official form.
.02 The 1040NR Return Originator
must advise the taxpayer to retain a
complete copy of the return and any
supporting material.
.03 The 1040NR Return Originator
must advise the taxpayer that an
amended return, if needed, must be filed
as a paper return and mailed to the
Philadelphia Service Center.
.04 The 1040NR Return Originator
must, upon request, provide the taxpayer
with the date the data portion of the
taxpayer’s composite return was ac-
knowledged as accepted for processing
by the Service.
.05 A 1040NR Return Originator must
advise taxpayers that they can call the
local IRS TeleTax number to inquire
about the status of their tax refund. The
1040NR Return Originator should also
advise taxpayers to wait at least three
weeks from the acceptance date of the
data portion of the composite return
before calling the TeleTax number.
.06 If a taxpayer chooses to use an
address other than his or her home
address on the return, the 1040NR Re-
turn Originator must inform the taxpayer
that the address on the data portion of
the composite return, once processed by
the Service, will be used to update the
taxpayer’s address of record. The Inter-
nal Revenue Service uses the taxpayer’s
address of record for various notices
that are required to be sent to a taxpay-
er’s ‘‘last known address’’ under the
Internal Revenue Code and for refunds
of overpayments of tax (unless other-
wise specifically directed by the tax-
payer, such as by Direct Deposit).
SECTION 9. DIRECT DEPOSIT OF
REFUNDS
.01 The Service will ordinarily pro-
cess a request for Direct Deposit but
reserves the right to issue a paper refund
check.
.02 The Service does not guarantee a
specific date by which a refund will be
directly deposited into the taxpayer’s
financial institution account. The taxpay-
er’s account must be with a financial
institution located in the United States.
.03 Neither the Service nor the Finan-
cial Management Service (FMS) is re-
sponsible for the misapplication of a
Direct Deposit that is caused by error,
negligence, or malfeasance on the part
of the taxpayer, 1040NR Filer, financial
institution, or any of their agents.
.04 A 1040NR Return Originator
must:
(1) advise taxpayers of the option
to receive their refund by paper check
or direct deposit;
(2) not charge a separate fee for
Direct Deposit;
(3) accept any Direct Deposit elec-
tion to any eligible financial institution
designated by the taxpayer;
(4) ensure that the taxpayer is eli-
gible to choose Direct Deposit;
(5) verify that the Direct Deposit
information requested on Part II of
Form 8453–NR was entered correctly
and that the information entered is the
information transmitted on the data por-
tion of the composite return;
(6) caution the taxpayer that once a
data portion of a composite return has
been accepted for processing by the
Service:
(a) the Direct Deposit election
cannot be rescinded;
(b) the Routing Transit Number
(RTN) of the financial institution cannot
be changed; and
(c) the taxpayer’s account num-
ber cannot be changed; and
(7) advise the taxpayer that refund
information is available by calling the
IRS TeleTax number. See section 8.05
of this revenue procedure.
SECTION 10. BALANCE DUE
RETURNS
.01 A magnetically or electronically
filed balance due return is submitted to
the Philadelphia Service Center in the
same manner that a refund or zero
balance return is submitted. A balance
due return is not complete unless and
until the Service receives a Form
8453–NR completed and signed by the
taxpayer.
.02 A taxpayer who magnetically or
electronically files a balance due return
must make a full and timely payment of
any tax that is due. Failure to make full
payment of any tax that is due on or
before April 15, 1997 (for individuals
who were employees and received
wages subject to U.S. federal income
tax withholding), or June 16, 1997 (for
14

individuals who were not employees
receiving wages subject to U.S. federal
income tax withholding), will result in
the imposition of interest and may result
in the imposition of penalties.
SECTION 11. ADVERTISING
STANDARDS FOR 1040NR FILERS
AND FINANCIAL INSTITUTIONS
.01 A 1040NR Filer must comply
with the advertising and solicitation pro-
visions of 31 C.F.R. Part 10 (Treasury
Department Circular No. 230). This cir-
cular prohibits the use or participation in
the use of any form of public communi-
cation containing a false, fraudulent,
misleading, deceptive, unduly influenc-
ing, coercive, or unfair statement or
claim. In addition, advertising must not
imply a special relationship with the
Service, FMS, or the Treasury Depart-
ment. Any claims concerning faster re-
funds by virtue of magnetically or elec-
tronically filing returns must be
consistent with the language in official
Service publications.
.02 A 1040NR Filer must adhere to
all relevant federal, state, and local
consumer protection laws that relate to
advertising and soliciting.
.03 A 1040NR Filer must not use the
Service’s name, ‘‘Internal Revenue Ser-
vice,’’ or ‘‘IRS’’ within a firm’s name.
.04 A 1040NR Filer must not use
improper or misleading advertising in
relation to the 1040NR Program (includ-
ing the time frames for refunds).
.05 Use of Direct Deposit name and
logo.
(1) The name ‘‘Direct Deposit’’
will be used with initial capital letters or
all capital letters.
(2) The logo/graphic for Direct De-
posit will be used whenever feasible in
advertising copy.
(3) The color or size of the Direct
Deposit logo/graphic may be changed
when used in advertising pieces.
.06 Advertising materials must not
carry the FMS, IRS, or other Treasury
seals.
.07 Advertising for a cooperative
1040NR return project (public/private
sector) must clearly state the names of
all cooperating parties.
.08 If a 1040NR Filer uses radio or
television broadcasting to advertise, the
broadcast must be pre-recorded. The
1040NR Filer must keep a copy of the
pre-recorded advertisement for a period
of at least 36 months from the date of
the last transmission or use.
.09 If a 1040NR Filer uses direct mail
or fax communications to advertise, the
1040NR Filer must retain a copy of the
actual mailing or fax, along with a list
or other description of the firms, organi-
zations or individuals to whom the com-
munication was mailed, faxed, or other-
wise distributed for a period of at least
36 months from the date of the last
mailing, fax, or distribution.
.10 Acceptance to participate in the
1040NR Program does not imply en-
dorsement by the Service or FMS of the
software or quality of services provided.
SECTION 12. MONITORING AND
SUSPENSION OF A 1040NR FILER
.01 The Service will monitor a
1040NR Filer for conformity with this
revenue procedure. The Service can im-
mediately suspend, without notice, a
1040NR Filer from the 1040NR Pro-
gram. However, in most circumstances,
a suspension from participation in the
1040NR Program is effective as of the
date of the letter informing the 1040NR
Filer of the suspension. Before suspend-
ing a 1040NR Filer, the Service may
issue a warning letter that describes
specific corrective action for deviations
from this revenue procedure.
.02 The Service will monitor the
timely receipt of Forms 8453–NR, as
well as their overall legibility.
.03 The Service will monitor the
quality of the 1040NR Filer’s submis-
sions throughout the filing season. The
Service will also monitor data portions
of composite returns and tabulate rejec-
tions, errors, and other defects. If quality
deteriorates, the 1040NR Filer may re-
ceive a warning from the Service.
.04 The Service will monitor com-
plaints about a 1040NR Filer and issue
a warning or suspension letter as appro-
priate.
.05 The Service reserves the right to
suspend the magnetic or electronic filing
privilege of any 1040NR Filer that vio-
lates any provision of this revenue pro-
cedure. Generally, the Service will ad-
vise a suspended 1040NR Filer
concerning the requirements for reac-
ceptance into the 1040NR Program. The
following reasons may lead to a warning
letter and/or suspension of a 1040NR
Filer from the 1040NR Program (this
list is not all-inclusive):
(1) the reasons listed in section
4.07 of this revenue procedure;
(2) deterioration in the format of
individual submissions;
(3) unacceptable cumulative error
or rejection rate;
(4) untimely received, illegible, in-
complete, missing, or unapproved sub-
stitute Forms 8453–NR;
(5) stockpiling returns at any time
while participating in the 1040NR Pro-
gram;
(6) failure on the part of a Trans-
mitter to initiate communication of the
acknowledgement files to clients within
five calendar days of receipt of the
acknowledgement files from the Service;
(7) significant complaints about a
1040NR Filer’s performance in the
1040NR Program;
(8) failure on the part of a 1040NR
Filer to ensure that no other entity uses
its assigned MTFIN;
(9) having more than one MTFIN
for the same business entity at the same
location (the business entity is generally
the entity that reports on its return the
income derived from magnetic or elec-
tronic filing), unless the Service has
issued more than one MTFIN to a
business entity;
(10) failure on the part of a
1040NR Filer to cooperate with the
Service’s efforts to monitor 1040NR
Filers and investigate filing abuse;
(11) failure on the part of a
1040NR Filer to properly use the
standard/non-standard W–2 indicator;
(12) failure on the part of a Ser-
vice Bureau or a Transmitter to use its
assigned MTFIN when filing returns;
(13) failure on the part of the
Transmitter to include a Service Bu-
reau’s MTFIN in the transmission of a
return submitted by a Service Bureau;
(14) failure on the part of a Ser-
vice Bureau or a Transmitter to include
the 1040NR Return Originator’s MTFIN
as part of a return that the 1040NR
Return Originator submits to the Service
Bureau or the Transmitter;
(15) violation of the advertising
standards described in section 11 of this
revenue procedure;
(16) failure to maintain and make
available records as described in sec-
tions 5.11(3) and (4) of this revenue
procedure;
(17) accepting a tax return for
magnetic or electronic filing either di-
rectly or indirectly from a firm, organi-
zation, or individual (other than the
taxpayer who is submitting his or her
return) that is not in the 1040NR Pro-
gram;
15

(18) submitting information on the
data portion of the composite return that
is not identical to the information on the
Form 8453–NR;
(19) failure to timely pay any ap-
plicable fees, as implemented by subse-
quent guidance; or
(20) failure to timely submit a re-
vised Form MAR–8980 notifying the
Service of changes described in section
4.02 or 4.03 of this revenue procedure.
.06 The Service may list in the Inter-
nal Revenue Bulletin, district office list-
ings, district office newsletters, on the
EFS Bulletin Board, or in other appro-
priate publications, the name of any
entity that is suspended from the
1040NR Program and the effective date
of that suspension.
.07 If an application for participation
in the 1040NR Program is denied, the
applicant is ineligible to submit a new
application for two years from the appli-
cation date of the denied application.
.08 If a participant is suspended from
participating in the 1040NR Program,
the period of suspension includes the
remainder of the calendar year in which
the suspension occurs plus the next two
calendar years.
SECTION 13. ADMINISTRATIVE
REVIEW PROCESS FOR DENIAL OF
PARTICIPATION IN THE 1040NR
PROGRAM
.01 An applicant that has been denied
participation in the 1040NR Program
has the right to an administrative review.
During the administrative review pro-
cess, the denial of participation remains
in effect.
.02 In response to the submission of a
Form MAR–8980, the Service will ei-
ther (1) accept an applicant into the
1040NR Program, or (2) issue a pro-
posed letter of denial that explains to
the applicant why the Service proposes
to reject the application to participate in
the 1040NR Program.
.03 An applicant that receives a pro-
posed letter of denial may mail or
deliver, within 30 calendar days of the
date of the proposed letter of denial, a
written response to the Project Office.
The applicant’s response must address
the Project Office’s explanation for pro-
posing the denial to participate.
.04 Upon receipt of an applicant’s
written response, the Project Office will
reconsider its proposed letter of denial.
The Project Office may (1) withdraw its
proposed letter of denial and admit the
applicant into the 1040NR Program, or
(2) finalize its proposed letter of denial
and issue it to the applicant.
.05 If an applicant receives a final
letter from the Project Office that denies
the applicant participation in the
1040NR Program, the applicant is en-
titled to an appeal, in writing, to the
Director of Practice.
.06 The appeal must be mailed or
delivered to the Project Office within 30
calendar days of the date of the denial
letter. An applicant’s written appeal must
contain a detailed explanation, with sup-
porting documentation, of why the de-
nial should be reversed. In addition, the
applicant must include a copy of the
applicant’s Form MAR–8980 and a copy
of the denial letter.
.07 The Project Office, upon receipt
of a written appeal to the Director of
Practice, will forward to the Director of
Practice its file on the applicant and the
materials described in section 13.06 that
the applicant has submitted to the
Project Office. The Project Office will
forward these materials to the Director
of Practice within 15 calendar days of
receipt of the applicant’s written appeal.
.08 Failure to respond within the
30-day periods described in sections
13.03 and 13.06 of this revenue proce-
dure irrevocably terminates an appli-
cant’s right to an administrative review
or appeal.
SECTION 14. ADMINISTRATIVE
REVIEW PROCESS FOR
SUSPENSION FROM THE 1040NR
PROGRAM
.01 A 1040NR Filer that has been
suspended from participation in the
1040NR Program has the right to an
administrative review. During the ad-
ministrative review process, the suspen-
sion remains in effect.
.02 If a 1040NR Filer receives a
proposed suspension letter, the 1040NR
Filer may mail or deliver, within 30
calendar days of the date of the pro-
posed suspension letter, a detailed writ-
ten explanation, with supporting docu-
mentation, of why the proposed
suspension letter should be withdrawn.
This written response should be sent to
the Project Office.
.03 Upon receipt of the 1040NR Fil-
er’s written response, the Project Office
will reconsider its proposed suspension
of the 1040NR Filer. The Project Office
will either withdraw its proposed sus-
pension letter and reinstate the 1040NR
Filer or finalize the proposed suspension
letter and issue it to the 1040NR Filer.
.04 If a 1040NR Filer receives a
suspension letter from the Project Of-
fice, the 1040NR Filer is entitled to an
appeal, in writing, to the Director of
Practice.
.05 The appeal must be mailed or
delivered to the Project Office within 30
calendar days of the date of the suspen-
sion letter. The 1040NR Filer’s written
appeal must contain detailed reasons,
with supporting documentation, for re-
versal of the suspension. In addition, the
1040NR Filer must include a copy of its
Form MAR–8980 and a copy of the
suspension letter.
.06 The Project Office, upon receipt
of a written appeal to the Director of
Practice, will forward to the Director of
Practice its file on the 1040NR Filer and
the material described in section 14.05
of this revenue procedure that the
1040NR Filer has submitted to the
Project Office. The Project Office will
forward these materials to the Director
of Practice within 15 calendar days of
the receipt of a 1040NR Filer’s written
request for appeal.
.07 Failure to appeal within the 30-
day period described in section 14.05 of
this revenue procedure irrevocably ter-
minates a 1040NR Filer’s right to an
appeal.
SECTION 15. EFFECT ON OTHER
DOCUMENTS
Rev. Proc. 96–35, 1996–1 C.B. 721,
is superseded.
SECTION 16. EFFECTIVE DATE
This revenue procedure is effective
May 23, 1997.
SECTION 17. PROJECT OFFICE
INFORMATION
All questions regarding this revenue
procedure should be directed to:
Internal Revenue Service
Philadelphia Service Center
ATTN: DP–115–Magnetic Media
Project Office
11601 Roosevelt Blvd.
Philadelphia, PA 19154
U.S.A.
The telephone number of this office is
(215) 516–7533 (not a toll-free number)
or 800–829–6945 (a toll-free number).
16

Part IV. Items of General Interest
Foundations Status of Certain
Organizations
Announcement 97–56
The following organizations have
failed to establish or have been unable
to maintain their status as public chari-
ties or as operating foundations. Accord-
ingly, grantors and contributors may not,
after this date, rely on previous rulings
or designations in the Cumulative List
of Organizations (Publication 78), or on
the presumption arising from the filing
of notices under section 508(b) of the
Code. This listing doesnotindicate that
the organizations have lost their status
as organizations described in section
501(c)(3), eligible to receive deductible
contributions.
Former Public Charities. The follow-
ing organizations (which have been
treated as organizations that are not
private foundations described in section
509(a) of the Code) are now classified
as private foundations:
Arnold High School Parent Student
Association, Arnold, CA
Artbeat Inc., Ashland, OR
Arthur Rex Incorporated, Chicago, IL
Asian Youth Center, San Francisco, CA
Association France Californie, Inc., Los
Angeles, CA
Boychoir of Ann Arbor, Chelsea, MI
Bravi 9 Inc., Irvine, CA
Brazosport Center Stages Inc., Lake
Jackson, TX
Breakfast Group, Seattle, WA
Bright Moments Music Lovers Club,
Inc., Oakland, CA
Central Health Initiative Inc., Mt.
Pleasant, MI
Central Idaho Interpretive Museum,
McCall, ID
Central Valley Path Program, Stockton,
CA
Chagrin Athletic Association, Chagrin
Falls, OH
Challenger Network of Houston,
Houston, TX
Challengers Athletics, Inc., Las Vegas,
NV
Children and Parents Support—C.A.P.S.
Services of Texas, Austin, TX
Chinese Christian Fellowship, Irvine,
CA
Chitrahar Foundation, Chicago, IL
Choose To Win, Madera, CA
Dreamer Ministries, Plano, TX
Dripping Springs ISD Educational
Foundation, Dripping Springs, TX
Drug Abuse Resistance Education
Colorado Association of D A R E
Officers, Denver, CO
Drugs Dont Work Inc., St. Petersburg,
FL
Duckett Institute of Global Scientific
Planning, Inc., New York, NY
Embrace Ministries for Romania,
Columbia, SC
Englewood Lions Foundation,
Englewood, CO
Esperanza Housing and Community
Development Corporation, Solana
Beach, CA
Everglades Restoration Movement Inc.,
Pompano Beach, FL
Excellence in Teaching Scholarship,
Pittsburgh, PA
Foundation of the National Bar
Association Women Lawyers
Division, Gulph Mills, PA
Four Corners Recycling, Farmington,
NM
Four Winds Center, Albuquerque, NM
Fredericksburg Music Club Inc.,
Fredericksburg, TX
Freedom Dental International, Inc.,
Grand Junction, CO
Fremont Education Foundation,
Fremont, CA
Fremont Stage 1, Fremont, CA
Fresh Beginnings Child Development
Center Bankruptcy, San Fernando, CA
Friends and Faculty of Ingram Tom
Moore High School, Ingram, TX
Grays Harbor College Choker Club
Association, Aberdeen, WA
Greater New York Vietamese American
Community Association, Inc., New
York, NY
Great Expectations, Inc., Grover Beach,
CA
Great Lakes Environmental Network,
Inc., East Lansing, MI
Green Country Enterprises for the Blind
Inc., Tulsa, OK
Hospice of Central Texas, Inc., San
Marcos, TX
Hospice of Pontotoc Inc., Ada, OK
Hospitality House of Oklahoma, Inc.,
McAlester, OK
House of Hope Group Home and Youth
Services, Stockton, CA
International Consortium of Knowledge
Workers, Boulder, CO
International Deafness Outreach, Inc.,
Rochester, NY
International Development Exchange,
Austin, TX
International Friends Committee, Lubec,
ME
International Institute for
Conservation-Related Ecological
Research Inc., Provo, UT
Los Angeles County Bilingual Directors
Association Inc., Downey, CA
Los Angeles County Victim Offender
Reconciliation Program Inc.,
Pasadena, CA
Momemtum for AIDS Priorities, Inc.,
Boston, MA
Montana Institute of Family Therapy
Inc., Bozeman, MT
Morningstar Foundation, Inc., Lagrange,
GA
Northern Nevada Mathematics Council,
Reno, NV
Northshore Shoreline Civic Theater,
Bothell, WA
North Slope Education Foundation Inc.,
Barrow, AK
Northwest Center for the Arts,
Stanwood, WA
Northwest Christian Writers Association,
Marysville, WA
Operation Kinder, San Francisco, CA
Oregon Loggers Training Association,
Eugene, OR
Organization of Afghan Professionals,
Alexandria, VA
Out of Sight Ministries, Seattle, WA
Over Seas Missions, Collinsville, IL
Proforum Inc., Takoma Park, MD
Project Enable, San Francisco, CA
Romanian Atheneum International
Foundation, Inc., New York, NY
Romanian International Foundation Ltd.,
Brooklyn, NY
Roseland Homes Resident Management
Corporation, Dallas, TX
Springville School Parent-Teacher
Organization, Springville, AL
Stanford Chaparral Publishing Support
Trust, Providence, RI
Starlight Foundation, Redmond, WA
Stewarts Care Home Inc., Memphis, TN
St. John Foundation, Los Angeles, CA
Stop the Oilport & Pipelines, Camano
Island, WA
St. Pauls Community Initiatives Inc.,
Paterson, NJ
Stradivari Society, Chicago, IL
Touch Romania Inc., San Francisco, CA
Triple L. Group Homes, Ramona, CA
Tulare Western Music Boosters, Tulare,
CA
Turk Street Apartments Inc., San
Francisco, CA
Twelfth District Quota International
Charitable and Educational
Foundation, Oakland, CA
Wladyslaw Poniecki Charitable
Foundation, El Cerrito, CA
171997–23 I.R.B.

Wolfe Street Development Company,
Baltimore, MD
Works in New Directions Inc., Los
Angeles, CA
Workstation Inc. A Permanent In-Home
Employment Agency for the Disabled
Individual, San Jose, CA
World Flag Alliance, Lynnwood, WA
If an organization listed above sub-
mits information that warrants the re-
newal of its classification as a public
charity or as a private operating founda-
tion, the Internal Revenue Service will
issue a ruling or determination letter
with the revised classification as to
foundation status. Grantors and contribu-
tors may thereafter rely upon such rul-
ing or determination letter as provided
in section 1.509(a)–7 of the Income Tax
Regulations. It is not the practice of the
Service to announce such revised classi-
fication of foundation status in the Inter-
nal Revenue Bulletin.
IRS/SSA INFORMATION REPORTING
SEMINARS
Announcement 97–57
Representatives from the Martinsburg
Computing Center, Information Returns
Branch, will conduct seminars in 24
cities during the months of August and
September. The seminar format will be
geared toward magnetic media/electronic
filers. They will cover magnetic media
changes for TY97, and detailed informa-
tion will be provided on the changes to
the record layout as a result of the three
new forms required for filing this year
(1099–LTC, 1099–MSA, and 5498–
MSA). The presentation will also in-
clude changes to other forms, test files,
correction and replacement files, Com-
bined Federal State Filing, and Backup
Withholding and Penalties as they relate
to information returns. A representative
of the Social Security Administration
will open the afternoon session and
discuss magnetic media reporting and
electronic filing specifications of Forms
W–2/W–3.
Following is a schedule of seminar
sites and dates, as well as the telephone
numbers of the Internal Revenue Service
office closest to the sites. Please contact
the appropriate office after July 11 for
the exact location and times.The
agenda for the day has also been
included for your convenience.
Internal Revenue Service
Martinsburg Computing Center
Information Reporting Seminar Schedule 1997
Atlanta, GASeptember 09404/331–3808
Baltimore, MDAugust 05410/962–2402
Boise, IDAugust 28208/334–9153 x3
Boston, MASeptember 23617/565–4325
Chicago, ILAugust 19312/886–1572
Columbus, OHSeptember 25513/684–2828
Denver, COAugust 28303/446–1662
Indianapolis, INAugust 21317/226–7650
Jacksonville, FLSeptember 18904/232–2514
Little Rock, ARAugust 28405/297–4125
Los Angeles, CASeptember 18213/894–4574
Minneapolis, MNSeptember 16612/290–3320
Nashville, TNSeptember 11615/736–2280
New Orleans, LASeptember 16504/558–3011
New York, NYSeptember 11212/436–1023
Oklahoma City, OKAugust 26405/297–4125
Omaha, NEAugust 26402/221–4018
Philadelphia, PASeptember 09215/597–0512
Phoenix, AZSeptember 09602/207–8618
Portland, ORAugust 26503/326–6565
Richmond, VASeptember 25804/771–8048
Rochester, NYSeptember 23716/686–4777
San Antonio, TXSeptember 11512/499–5439
San Francisco, CASeptember 16510/637–2482
AGENDA
MORNING SESSIONAFTERNOON SESSION
IRS/MARTINSBURG COMPUTING CENTERSOCIAL SECURITY ADMINISTRATION
9:00a Welcome
Magnetic Media and Electronic Filing
of Forms 1099, 1098, 5498, and W–2G
1:00p Form W–2 Magnetic Media reporting and electronic
filing specifications
10:45a Break
11:00a Backup Withholding and Penalties
12:00p Lunch
ATTENTION PAPER FILERS:
The 1099/W–2 sessions are geared toward the magnetic media/electronic filer, and attendees should expect presentations to
highlight that filing only.No tax law representatives will be present to answer questions.
181997–23 I.R.B.

Announcement of the Disbarment, Suspension, or Consent to Voluntary
Suspension of Attorneys, Certified Public Accountants, Enrolled Agents, and
Enrolled Actuaries From Practice Before the Internal Revenue Service
Under 31 Code of Federal Regula-
tions, Part 10, an attorney, certified pub-
lic accountant, enrolled agent or enrolled
actuary, in order to avoid the institution
or conclusion of a proceeding for his
disbarment or suspension from practice
before the Internal Revenue Service,
may offer his consent to suspension
from such practice. The Director of
Practice, in his discretion, may suspend
an attorney, certified public accountant,
enrolled agent or enrolled actuary in
accordance with the consent offered.
Attorneys, certified public accoun-
tants, enrolled agents and enrolled actu-
aries are prohibited in any Internal Rev-
enue Service matter from directly or
indirectly employing, accepting assis-
tance from, being employed by or shar-
ing fees with, any practitioner disbarred
or suspended from practice before the
Internal Revenue Service.
To enable attorneys, certified public
accountants, enrolled agents and en-
rolled actuaries to identify practitioners
under consent suspension from practice
before the Internal Revenue Service, the
Director of Practice will announce in the
Internal Revenue Bulletin the names and
addresses of practitioners who have
been suspended from such practice, their
designation as attorney, certified public
accountant, enrolled agent or enrolled
actuary and date or period of suspen-
sion. This announcement will appear in
the weekly Bulletin at the earliest practi-
cable date after such action and will
continue to appear in the weekly Bulle-
tins for five successive weeks or for as
many weeks as is practicable for each
attorney, certified public accountant, en-
rolled agent or enrolled actuary so sus-
pended and will be consolidated and
published in the Cumulative Bulletin.
The following individuals have been
placed under consent suspension from
practice before the Internal Revenue
Service:
NameAddressDesignationDate of Suspension
Bert Jr., Earol L.Severna Park, MDCPAFebruary 1, 1997 to July 31, 1997
Bernard, Lucius P.Corte Medera, CAAttorneyMarch 10, 1997 to March 9, 2000
Parker, David A.Willmar, MNCPAApril 13, 1997 to April 12, 2000
Sheldon, DonaldNashville, TNCPAApril 24, 1997 to September 23, 1997
Grandt, Lawrence E.Barrington, ILCPAApril 24, 1997 to January 23, 1998
Reese, Rex E.Alexandria, VAAttorneyMay 1, 1997 to April 30, 1999
Glasl, John E.Emporium, PACPAMay 1, 1997 to September 30, 1997
Coulter, Diane E.Monroeville, PACPAMay 1, 1997 to April 30, 1998
Groves, J. RandallMatthews, NCAttorneyMay 1, 1997 to October 31, 1998
Lupiloff, StevenBloomfield, MIAttorneyIndefinite from May 6, 1997
Wilson, Robert L.Spring Hill, FLCPAMay 7, 1997 to October 6, 1998
Sloop, Wayne F.Winston-Salem, NCCPAIndefinite from May 7, 1997
Wilnewic, Mark V.Crystal Lake, ILCPAMay 8, 1997 to November 7, 1997
Lenihan, MichaelCincinnati, OHCPAMay 14, 1997 to July 13, 1997
Bergmann, FrederickTampa, FLCPAJune 1, 1997 to May 30, 1999
Farmer, CraigArlington Hghts, ILCPAJune 1, 1997 to August 31, 1997
Denny, RichardPine Bluff, ARCPAJune 1, 1997 to July 31, 1997
19

Announcement of the Expedited Suspension of Attorneys, Certified Public
Accountants, Enrolled Agents, and Enrolled Actuaries From Practice Before the
Internal Revenue Service
Under title 31 of the Code of Federal
Regulations, section 10.76, the Director
of Practice is authorized to immediately
suspend from practice before the Inter-
nal Revenue Service any practitioner
who, within five years, from the date
the expedited proceeding is instituted,
(1) has had a license to practice as an
attorney, certified public accountant, or
actuary suspended or revoked for cause;
or (2) has been convicted of any crime
under title 26 of the United States Code
or, of a felony under title 18 of the
United States Code involving dishonesty
or breach of trust.
Attorneys, certified public accoun-
tants, enrolled agents and enrolled actu-
aries are prohibited in any Internal Rev-
enue Service matter from directly or
indirectly employing, accepting assis-
tance from, being employed by, or shar-
ing fees with, any practitioner disbarred
or suspended from practice before the
Internal Revenue Service.
To enable attorneys, certified public
accountants, enrolled agents, and en-
rolled actuaries to identify practitioners
under expedited suspension from prac-
tice before the Internal Revenue Service,
the Director of Practice will announce in
the Internal Revenue Bulletin the names
and addresses of practitioners who have
been suspended from such practice, their
designation as attorney, certified public
accountant, enrolled agent, or enrolled
actuary, and date or period of suspen-
sion. This announcement will appear in
the weekly Bulletin at the earliest practi-
cable date after such action and will
continue to appear in the weekly Bulle-
tins for five successive weeks or for as
many weeks as is practicable for each
attorney, certified public accountant, en-
rolled agent, or enrolled actuary so
suspended and will be consolidated and
published in the Cumulative Bulletin.
The following individuals have been
placed under suspension from practice
before the Internal Revenue Service by
virtue of the expedited proceeding pro-
visions of the applicable regulations:
NameAddressDesignationDate of Suspension
Dally, Candace L.Winston-Salem, NCCPAIndefinite from April 16, 1997
Mellor, Gary D.Norton, KSAttorneyIndefinite from April 16, 1997
Gottesman, MiltonNew York, NYCPAIndefinite from April 16, 1997
Wiener, JamesGermantown, NYAttorneyIndefinite from April 16, 1997
Lunblad, GeraldSacramento, CACPAIndefinite from April 16, 1997
Driscoll, Robert J.Denver, COAttorneyIndefinite from April 16, 1997
Alico, Kenneth N.Orchard Park, NYCPAIndefinite from April 16, 1997
Mack, Roland G.Hyattsville, MDCPAIndefinite from May 1, 1997
20

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 de-
scribe the effect:
Amplifieddescribes a situation where
no change is being made in a prior
published position, but the prior position
is being extended to apply to a variation
of the fact situation set forth therein.
Thus, if an earlier ruling held that a
principle applied to A, and the new
ruling holds that the same principle also
applies to B, the earlier ruling is ampli-
fied. (Compare withmodified, below).
Clarifiedis used in those instances
where the language in a prior ruling is
being made clear because the language
has caused, or may cause, some confu-
sion. It is not used where a position in a
prior ruling is being changed.
Distinguisheddescribes a situation
where a ruling mentions a previously
published ruling and points out an es-
sential difference between them.
Modifiedis 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 pub-
lished position. (Compare withamplified
andclarified, above).
Obsoleteddescribes a previously pub-
lished ruling that is not considered de-
terminative with respect to future trans-
actions. This term is most commonly
used in a ruling that lists previously
published rulings that are obsoleted be-
cause of changes in law or regulations.
A ruling may also be obsoleted because
the substance has been included in regu-
lations subsequently adopted.
Revokeddescribes situations where
the position in the previously published
ruling is not correct and the correct
position is being stated in the new
ruling.
Supersededdescribes 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 previ-
ously published over a period of time in
separate rulings. If the new ruling does
more than restate the substance of a
prior ruling, a combination of terms is
used. For example,modifiedandsuper-
sededdescribes a situation where the
substance of a previously published rul-
ing is being changed in part and is
continued without change in part and it
is desired to restate the valid portion of
the previously published ruling in a new
ruling that is self contained. In this case
the previously published ruling is first
modified and then, as modified, is su-
perseded.
Supplementedis 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 rulings in the series.
Suspendedis 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
cases in litigation, or the outcome of a
Service study.
Abbreviations
The following abbreviations in current use and
formerly used will appear in material published in
the Bulletin.
A—Individual.
Acq.—Acquiescence.
B—Individual.
BE—Beneficiary.
BK—Bank.
B.T.A.—Board of Tax Appeals.
C.—Individual.
C.B.—Cumulative Bulletin.
CFR—Code of Federal Regulations.
CI—City.
COOP—Cooperative.
Ct.D.—Court Decision.
CY—County.
D—Decedent.
DC—Dummy Corporation.
DE—Donee.
Del. Order—Delegation Order.
DISC—Domestic International Sales Corporation.
DR—Donor.
E—Estate.
EE—Employee.
E.O.—Executive Order.
ER—Employer.
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduciary.
FC—Foreign Country.
FICA—Federal Insurance Contribution 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.—Statements 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.
21

Numerical Finding List
1
Bulletin 1997–1 through 1997–22
Announcements:
97–1, 1997–2 I.R.B.63
97–2, 1997–2 I.R.B.63
97–3, 1997–2 I.R.B.63
97–4, 1997–3 I.R.B.14
97–5, 1997–3 I.R.B.15
97–6, 1997–4 I.R.B.11
97–7, 1997–4 I.R.B.12
97–8, 1997–4 I.R.B.12
97–9, 1997–5 I.R.B.27
97–10, 1997–10 I.R.B.64
97–11, 1997–6 I.R.B.19
97–12, 1997–7 I.R.B.55
97–13, 1997–8 I.R.B.38
97–14, 1997–8 I.R.B.38
97–15, 1997–9 I.R.B.23
97–16, 1997–9 I.R.B.23
97–17, 1997–9 I.R.B.23
97–18, 1997–10 I.R.B.67
97–19, 1997–10 I.R.B.68
97–20, 1997–11 I.R.B.22
97–21, 1997–11 I.R.B.23
97–22, 1997–12 I.R.B.47
97–23, 1997–11 I.R.B.23
97–24, 1997–11 I.R.B.24
97–25, 1997–12 I.R.B.47
97–26, 1997–12 I.R.B.48
97–27, 1997–13 I.R.B.30
97–28, 1997–14 I.R.B.15
97–29, 1997–14 I.R.B.16
97–30, 1997–14 I.R.B.16
97–31, 1997–14 I.R.B.16
97–32, 1997–14 I.R.B.17
97–33, 1997–15 I.R.B.8
97–34, 1997–15 I.R.B.8
97–35, 1997–15 I.R.B.9
97–36, 1997–15 I.R.B.10
97–37, 1997–15 I.R.B.10
97–38, 1997–15 I.R.B.10
97–39, 1997–16 I.R.B.27
97–40, 1997–16 I.R.B.28
97–41, 1997–16 I.R.B.28
97–42, 1997–17 I.R.B.19
97–43, 1997–17 I.R.B.19
97–44, 1997–17 I.R.B.19
97–45, 1997–17 I.R.B.20
97–46, 1997–18 I.R.B.53
97–47, 1997–19 I.R.B.94
97–48, 1997–20 I.R.B.8
97–49, 1997–20 I.R.B.8
97–50, 1997–20 I.R.B.8
97–51, 1997–20 I.R.B.9
97–52, 1997–21 I.R.B.22
97–53, 1997–21 I.R.B.22
97–54, 1997–22 I.R.B.23
97–55, 1997–22 I.R.B.23
Notices:
97–1, 1997–2 I.R.B.22
97–2, 1997–2 I.R.B.22
97–3, 1997–1 I.R.B.8
97–4, 1997–2 I.R.B.24
97–5, 1997–2 I.R.B.25
97–6, 1997–2 I.R.B.26
97–7, 1997–1 I.R.B.8
97–8, 1997–4 I.R.B.7
97–9, 1997–2 I.R.B.35
97–10, 1997–2 I.R.B.41
97–11, 1997–2 I.R.B.50
Notices—Continued
97–12, 1997–3 I.R.B.11
97–13, 1997–6 I.R.B.13
97–14, 1997–8 I.R.B.23
97–15, 1997–8 I.R.B.23
97–16, 1997–9 I.R.B.15
97–17, 1997–10 I.R.B.34
97–18, 1997–10 I.R.B.35
97–19, 1997–10 I.R.B.40
97–20, 1997–10 I.R.B.52
97–21, 1997–11 I.R.B.9
97–22, 1997–13 I.R.B.9
97–23, 1997–14 I.R.B.8
97–24, 1997–16 I.R.B.6
97–25, 1997–16 I.R.B.8
97–26, 1997–17 I.R.B.6
97–27, 1997–17 I.R.B.7
97–28, 1997–18 I.R.B.45
97–29, 1997–20 I.R.B.6
97–30, 1997–20 I.R.B.6
97–31, 1997–21 I.R.B.5
97–32, 1997–21 I.R.B.8
97–33, 1997–22 I.R.B.22
Proposed Regulations:
REG–209332–80, 1997–14 I.R.B.9
REG–209040–88, 1997–7 I.R.B.34
REG–209121–89, 1997–11 I.R.B.15
REG–208288–90, 1997–11 I.R.B.14
REG–209494–90, 1997–8 I.R.B.24
REG–208172–91, 1997–10 I.R.B.59
REG–209672–93, 1997–6 I.R.B.15
REG–209709–94 1997–13 I.R.B.12
REG–209729–94, 1997–11 I.R.B.19
REG–209762–95, 1997–3 I.R.B.12
REG–209785–95, 1997–18 I.R.B.46
REG–209817–96, 1997–7 I.R.B.41
REG–209823–96, 1997–18 I.R.B.47
REG–209824–96, 1997–11 I.R.B.19
REG–209828–96, 1997–6 I.R.B.15
REG–209830–96, 1997–15 I.R.B.7
REG–209834–96, 1997–4 I.R.B.9
REG–209839–96, 1997–8 I.R.B.26
REG–242996–96, 1997–9 I.R.B.18
REG–246018–96, 1997–8 I.R.B.30
REG–247678–96, 1997–6 I.R.B.17
REG–247862–96, 1997–8 I.R.B.32
REG–248770–96, 1997–8 I.R.B.33
REG–249819–96, 1997–7 I.R.B.50
REG–252231–96, 1997–7 I.R.B.52
REG–252233–96, 1997–9 I.R.B.19
REG–252665–96, 1997–12 I.R.B.46
REG–253578–96, 1997–19 I.R.B.93
REG–254394–96, 1997–14 I.R.B.14
Public Law:
105–2, 1997–18 I.R.B.14
Railroad Retirement Quarterly Rate:
1997–21 I.R.B.4
Revenue Procedures:
97–1, 1997–1 I.R.B.11
97–2, 1997–1 I.R.B.64
97–3, 1997–1 I.R.B.84
97–4, 1997–1 I.R.B.96
97–5, 1997–1 I.R.B.132
97–6, 1997–1 I.R.B.153
97–7, 1997–1 I.R.B.185
97–8, 1997–1 I.R.B.187
97–9, 1997–2 I.R.B.56
97–10, 1997–2 I.R.B.59
97–11, 1997–6 I.R.B.13
Revenue Procedures—Continued
97–12, 1997–4 I.R.B.7
97–13, 1997–5 I.R.B.18
97–14, 1997–5 I.R.B.20
97–15, 1997–5 I.R.B.21
97–16, 1997–5 I.R.B.25
97–17, 1997–9 I.R.B.15
97–18, 1997–10 I.R.B.53
97–19, 1997–10 I.R.B.55
97–20, 1997–11 I.R.B.10
97–21, 1997–12 I.R.B.44
97–22, 1997–13 I.R.B.9
97–23, 1997–17 I.R.B.7
97–24, 1997–16 I.R.B.10
97–24A, 1997–20 I.R.B.7
97–25, 1997–17 I.R.B.8
97–26, 1997–17 I.R.B.17
97–27, 1997–21 I.R.B.10
Revenue Rulings:
97–1, 1997–2 I.R.B.10
97–2, 1997–2 I.R.B.7
97–3, 1997–2 I.R.B.5
97–4, 1997–3 I.R.B.6
97–5, 1997–4 I.R.B.5
97–6, 1997–4 I.R.B.4
97–7, 1997–5 I.R.B.14
97–8, 1997–7 I.R.B.4
97–9, 1997–9 I.R.B.4
97–10, 1997–10 I.R.B.31
97–11, 1997–10 I.R.B.5
97–12, 1997–11 I.R.B.5
97–13, 1997–16 I.R.B.4
97–14, 1997–11 I.R.B.5
97–15, 1997–12 I.R.B.42
97–16, 1997–13 I.R.B.4
97–17, 1997–14 I.R.B.5
97–18, 1997–15 I.R.B.4
97–19, 1997–18 I.R.B.11
97–20, 1997–19 I.R.B.4
97–21, 1997–18 I.R.B.8
97–22, 1997–20 I.R.B.5
97–23, 1997–22 I.R.B.18
97–24, 1997–22 I.R.B.17
Social Security Domestic Coverage Threshold:
1997–9, I.R.B.17
Tax Conventions:
1997–17 I.R.B.5
Treasury Decisions:
8688, 1997–3 I.R.B.7
8689, 1997–3 I.R.B.9
8690, 1997–5 I.R.B.5
8691, 1997–5 I.R.B.16
8692, 1997–3 I.R.B.4
8693, 1997–6 I.R.B.9
8694, 1997–6 I.R.B.11
8695, 1997–4 I.R.B.5
8696, 1997–6 I.R.B.4
8697, 1997–2 I.R.B.11
8698, 1997–7 I.R.B.29
8699, 1997–6 I.R.B.4
8700, 1997–7 I.R.B.5
8701, 1997–7 I.R.B.23
8702, 1997–8 I.R.B.4
8703, 1997–8 I.R.B.18
8704, 1997–8 I.R.B.12
8705, 1997–8 I.R.B.16
8706, 1997–9 I.R.B.11
8707, 1997–7 I.R.B.17
8708, 1997–10 I.R.B.14
1
See footnote at end of list.
22

Numerical Finding List—Continued
Bulletins 1997–1 through 1997–22
Treasury Decisions—Continued
8709, 1997–9 I.R.B.5
8710, 1997–13 I.R.B.4
8711, 1997–12 I.R.B.35
8712, 1997–12 I.R.B.4
8713, 1997–14 I.R.B.4
8714, 1997–15 I.R.B.5
8715, 1997–18 I.R.B.5
8716, 1997–19 I.R.B.5
8718, 1997–22 I.R.B.4
1
A cumulative list of all Revenue Rulings,
Revenue Procedures, Treasury Decisions, etc.,
published in Internal Revenue Bulletins 1996–27
through 1996–53 will be found in Internal
Revenue Bulletin 1997–1, dated January 6, 1997.
23

Finding List of Current Action on
Previously Published Items
1
Bulletin 1997–1 through 1997–22
*Denotes entry since last publication
Revenue Procedures:
66–3
Modified by
97–11, 1997–6 I.R.B.13
87–21
Modified by
97–11, 1997–6 I.R.B.13
92–20
Modified by
97–1, 1997–1 I.R.B.11
92–20
Modified by
97–10, 1997–2 I.R.B.59
92–90
Superseded by
97–1, 1997–1 I.R.B.11
94–52
Revoked by
97–11, 1997–6 I.R.B.13
96–1
Superseded by
97–1, 1997–1 I.R.B.11
96–2
Superseded by
97–2, 1997–1 I.R.B.64
96–3
Superseded by
97–3, 1997–1 I.R.B.84
96–4
Superseded by
97–4, 1997–1 I.R.B.96
96–5
Superseded by
97–5, 1997–1 I.R.B.132
96–6
Superseded by
97–6, 1997–1 I.R.B.153
96–7
Superseded by
97–7, 1997–1 I.R.B.185
96–8
Superseded by
97–8, 1997–1 I.R.B.187
96–24
96–24A
Superseded by
97–24, 1997–16 I.R.B.10
96–37
Obsoleted by
97–26, 1997–17 I.R.B.17
97–2
Amplified by
97–21, 1997–12 I.R.B.44
Revenue Procedures—Continued
97–3
Amplified by
97–23, 1997–17 I.R.B.7
Revenue Rulings:
70–480
Revoked by
97–6, 1997–4 I.R.B.4
72–527
Obsoleted by
8704, 1997–8 I.R.B.12
74–59
Revoked by
8708, 1997–10 I.R.B.14
92–19
Supplemented in part by
97–2, 1997–2 I.R.B.7
96–12
Superseded by
97–3, 1997–1 I.R.B.84
96–13
Modified by
97–1, 1997–1 I.R.B.11
96–22
Superseded by
97–3, 1997–1 I.R.B.84
96–34
Superseded by
97–3, 1997–1 I.R.B.84
96–39
Superseded by
97–3, 1997–1 I.R.B.84
96–43
Superseded by
97–3, 1997–1 I.R.B.84
96–56
Superseded by
97–3, 1997–1 I.R.B.84
1
A cumulative finding list for previously published
items mentioned in Internal Revenue Bulletins
1996–27 through 1996–53 will be found in Inter-
nal Revenue Bulletin 1997–1, dated January 6,
1997.
24

NOTES
25

NOTES
26

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INTERNAL REVENUE BULLETIN
The Introduction on page 3 describes the purpose and content of this publication. The weekly Internal Revenue Bulletin is
sold on a yearly subscription basis by the Superintendent of Documents. Current subscribers are notified by the Superintendent
of Documents when their subscriptions must be renewed.
CUMULATIVE BULLETINS
The contents of this weekly Bulletin are consolidated semiannually into a permanent, indexed, Cumulative Bulletin. These
are sold on a single copy basis andare notincluded as part of the subscription to the Internal Revenue Bulletin. Subscribers to
the weekly Bulletin are notified when copies of the Cumulative Bulletin are available. Certain issues of Cumulative Bulletins
are out of print and are not available. Persons desiring available Cumulative Bulletins, which are listed on the reverse, may
purchase them from the Superintendent of Documents.
HOW TO ORDER
Check the publications and/or subscription(s) desired on the reverse, complete the order blank, enclose the proper remittance,
detach entire page, and mail to the Superintendent of Documents, U.S. Government Printing Office, Washington, D.C. 20402.
Please allow two to six weeks, plus mailing time, for delivery.
Internal Revenue Service
Washington, DC 20224
Official Business
Penalty for Private Use, $300