Internal Revenue Bulletin 2017-21 (PDF rendition): IRS Revenue Rulings

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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.
INCOME TAX
Rev. Rul. 2017–09, page 1244.
This revenue ruling provides guidance regarding the federal
tax treatment of certain transactions referred to as ‘north-
south’ transactions. The guidance describes two north-south
transactions: one involving steps that are respected as sepa-
rate and another involving steps that are integrated. This rev-
enue ruling also removes § 5.02 from Rev. Proc. 2017–3,
2017–1 I.R.B. 130, thereby lifting the prohibition on private
letter rulings involving north-south transactions.
Rev. Proc. 2017–36, page 1251.
This revenue procedure provides indexing adjustments for certain
provisions under sections 36B and 5000A of the Internal Revenue
Code. In particular, it updates the Applicable Percentage Table in
§ 36B(b)(3)(A)(i) to provide the Applicable Percentage Table for
2018. This table is used to calculate an individual’s premium tax
credit. This revenue procedure also updates the required contri-
bution percentage in section 36B(c)(2)(C)(i)(II) for plan years be-
ginning after calendar year 2017. The percentage is used to
determine whether an individual is eligible for affordable employer-
sponsored minimum essential coverage under § 36B.
Rev. Proc. 2017–37, page 1252.
This revenue procedure provides the 2018 inflation adjusted
amounts for Health Savings Accounts (HSAs) as determined
under section 223 of the Internal Revenue Code.
EXCISE TAX
Notice 2017–30, page 1248.
This notice provides 180-day emergency relief for fuel remov-
als from Milwaukee terminals due to the shutdown of the West
Shore Pipeline. Once the 180-day emergency relief expires, the
notice provides a temporary mechanism for refunds of the
§ 4081(a)(1) tax imposed upon removals of undyed diesel fuel
from a Milwaukee terminal when such fuel is transported to and
entered into a Green Bay terminal and subsequently removed
from that Green Bay terminal as dyed fuel destined for a
nontaxable use.
ADMINISTRATIVE
Notice 2017–30, page 1248.
This notice provides 180-day emergency relief for fuel remov-
als from Milwaukee terminals due to the shutdown of the West
Shore Pipeline. Once the 180-day emergency relief expires, the
notice provides a temporary mechanism for refunds of the
§ 4081(a)(1) tax imposed upon removals of undyed diesel fuel
from a Milwaukee terminal when such fuel is transported to and
entered into a Green Bay terminal and subsequently removed
from that Green Bay terminal as dyed fuel destined for a
nontaxable use.
Rev. Proc. 2017–35, page 1250.
The proposed revenue procedure provides issuers of qualified
mortgage bonds, as defined in section 143(a) of the Internal
Revenue Code , and issuers of mortgage credit certificates as
defined in section 25(c), with the United States median gross
income figure most recently computed by the Department of
Housing and Urban Development (HUD). The proposed revenue
procedure also provides these issuers with guidance concern-
ing the area median gross income as computed by HUD.
Issuers of qualified mortgage bonds (QMB) and mortgage
credit certificates (MCC) must use these income figures in
determining whether the income limitation placed on the ben-
eficiaries of the mortgages and certificates may be increased
because the residences to be financed are located in high
housing cost areas. See sections 25(c)(A)(iii)(IV) and 143(f)(5).
Finding Lists begin on page ii.
Bulletin No. 2017–21
May 22, 2017

The IRS Mission
Provide America’s taxpayers top-quality service by helping
them understand and meet their tax responsibilities and en-
force the law with integrity and fairness to all.
Introduction
The Internal Revenue Bulletin is the authoritative instrument of
the Commissioner of Internal Revenue for announcing official
rulings and procedures of the Internal Revenue Service and for
publishing Treasury Decisions, Executive Orders, Tax Conven-
tions, legislation, court decisions, and other items of general
interest. It is published weekly.
It is the policy of the Service to publish in the Bulletin all
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 other-
wise indicated. Procedures relating solely to matters of internal
management are not published; however, statements of inter-
nal practices and procedures that affect the rights and duties
of taxpayers are published.
Revenue rulings represent the conclusions of the Service on
the application of the law to the pivotal facts stated in the
revenue ruling. In those based on positions taken in rulings to
taxpayers or technical advice to Service field offices, identify-
ing details and information of a confidential nature are deleted
to prevent unwarranted invasions of privacy and to comply with
statutory requirements.
Rulings and procedures reported in the Bulletin do not have the
force and effect of Treasury Department Regulations, but they
may be used as precedents. Unpublished rulings will not be
relied on, used, or cited as precedents by Service personnel in
the disposition of other cases. In applying published rulings and
procedures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be considered,
and Service personnel and others concerned are cautioned
against reaching the same conclusions in other cases unless
the facts and circumstances are substantially the same.
The Bulletin is divided into four parts as follows:
Part I.—1986 Code.
This part includes rulings and decisions based on provisions of
the Internal Revenue Code of 1986.
Part II.—Treaties and Tax Legislation.
This part is divided into two subparts as follows: Subpart A, Tax
Conventions and Other Related Items, and Subpart B, Legisla-
tion 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 Rul-
ings. Bank Secrecy Act Administrative Rulings are issued by
the Department of the Treasury’s Office of the Assistant Sec-
retary (Enforcement).
Part IV.—Items of General Interest.
This part includes notices of proposed rulemakings, disbar-
ment and suspension lists, and announcements.
The last Bulletin for each month includes a cumulative index for
the matters published during the preceding months. These
monthly indexes are cumulated on a semiannual basis, and are
published in the last Bulletin of each semiannual period.
The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.
May 22, 2017Bulletin No. 2017–21

Part I. Rulings and Decisions Under the Internal Revenue Code
of 1986
Section 355.—Distribution
of Stock and Securities of
a Controlled Corporation
IRC § 355: Distribution of Stock and Securities of a
Controlled Corporation (Also §§ 301; 351; 361; 368)
Rev. Rul. 2017–09
ISSUES
(1) If a parent corporation (P) transfers
property (including property con-
stituting an active trade or business
that is transferred for the purpose
of meeting the requirements of
§ 355(b)(1)(A) of the Internal Rev-
enue Code (Code)), to its subsid-
iary (D), and if, pursuant to the
same overall plan, this transfer is
followed by a distribution byDof
the stock of its controlled subsid-
iary (C)toP, are the transactions
treated for federal income tax pur-
poses as an exchange under § 351,
followed by a distribution under
§ 355?
(2) Is a transfer of money or other
property byCtoD, made in pursu-
ance of a plan of reorganization
under §§ 368(a)(1)(D) and 355,
governed by § 301 or § 361?
FACTS
Situation 1:
Powns all the stock ofD, which owns
all the stock ofC. The fair market value of
theCstock is $100X.Phas been engaged
in Business A for more than 5 years, and
Chas been engaged in Business B for
more than 5 years. Business A and Busi-
ness B each constitutes the active conduct
of a trade or business within the meaning
of § 355(b).Dis not engaged in the active
conduct of a trade or business,directly or
through any member of its separate af-
filiated group (within the meaning of
§ 355(b)(3)) other thanC.
On Date 1,Ptransfers the property and
activities constituting Business A, having
a fair market value of $25X, toDin ex-
change for additional shares ofDstock.
On Date 2, pursuant to a dividend decla-
ration,Dtransfers all theCstock toPfor
a valid corporate business purpose.Dre-
tains the Business A property and contin-
ues the active conduct of Business A after
the distribution. The purpose ofP’s trans-
fer of the property and activities of Busi-
ness A toDis to allowDto satisfy the
active trade or business requirement of
§ 355(b)(1)(A).
Situation 2:
Powns all the stock ofD, which owns
all the stock ofC.Dhas been engaged in
Business A for more than 5 years.Chas
been engaged in Business B for more than
5 years. Business A and Business B each
constitutes the active conduct of a trade or
business within the meaning of § 355(b).
On Date 1,Ctransfers $15X of money
and property having a fair market value of
$10X toD, pursuant to a dividend decla-
ration, andDretains the money and prop-
erty. On Date 2,Dtransfers toCproperty
having a basis of $20X and a fair market
value of $100X, andDdistributes all the
Cstock toPin a transaction qualifying as
a reorganization under §§ 368(a)(1)(D)
and 355.CandDplanned and executed
the Date 1 transfer in pursuance of the
plan of reorganization.
LAW
Section 301(c)(1) provides that a dis-
tribution that is a dividend (as defined in
§ 316), made by a corporation to a share-
holder with respect to its stock, will be
includible in the gross income of the
shareholder. Section 301(c)(2) provides
that the portion of the distribution which
is not a dividend will be applied against
and reduce the adjusted basis of the stock.
Section 301(c)(3) provides that the por-
tion of the distribution which is not a
dividend, to the extent that it exceeds the
adjusted basis of the stock, will be treated
as gain from the sale or exchange of prop-
erty.
Section 311(b) provides in part that, if
a corporation distributes appreciated prop-
erty to a shareholder in a distribution to
which § 301 applies, gain (but no loss)
will be recognized to the distributing cor-
poration as if it had sold the property to
the shareholder at its fair market value.
Section 316 generally defines a divi-
dend as any distribution of property made
by a corporation to its shareholders out of
its earnings and profits accumulated after
February 28, 1913, or out of its earnings
and profits of the taxable year (computed
as of the close of the taxable year without
diminution by reason of any other distri-
butions made during the taxable year),
without regard to the amount of the earn-
ings and profits at the time the distribution
was made.
Section 351(a) provides that no gain or
loss will be recognized when property is
transferred to a corporation by one or
more persons solely in exchange for stock
in such corporation and immediately after
the exchange such person or persons are
in control (as defined in § 368(c)) of the
corporation.
Section 355(a)(1) provides that, if cer-
tain requirements are met, a corporation
may distribute stock and securities of a
controlled corporation to its shareholders
and security holders without recognition
of gain or loss (nonrecognition treatment)
or income to the recipient shareholders or
security holders.
Section 355(a)(1)(A) provides that, for
a distribution to qualify for nonrecogni-
tion treatment, the distributing corpora-
tion must distribute stock or securities of
a corporation it controls (as defined in
§ 368(c)) immediately before the distribu-
tion.
Section 355(a)(1)(D) provides in part
that a distribution may qualify for nonrec-
ognition treatment if the distributing
corporation distributes an amount of stock
in the controlled corporation constituting
control within the meaning of § 368(c).
Section 355(b)(1)(A) provides that the
distributing corporation and the controlled
corporation each must be engaged in the
active conduct of a trade or business im-
mediately after the distribution.
Section 361(a) provides that no gain or
loss will be recognized to a corporation a
party to a reorganization upon exchange
of property in pursuance of a plan of re-
organization solely for stock or securities
in another corporation a party to the reor-
ganization.
May 22, 2017Bulletin No. 2017–21
1244

Section361(b)providesthat,if
§ 361(a) would apply to an exchange of
assets by a reorganizing corporation but
for the fact that the property received in
exchange consists not only of stock or
securities of the acquiring corporation
permitted by § 361(a) to be received with-
out the recognition of gain, but also of
other property or money, then (A) if the
corporation receiving that other property
or money distributes it in pursuance of the
plan of reorganization, no gain to the cor-
poration will be recognized from the ex-
change, but (B) if the corporation receiv-
ing that other property or money does not
distribute it in pursuance of the plan of
reorganization, any gain that the corpora-
tion realizes on the exchange of its prop-
erty will be recognized up to the sum of
the money and the fair market value of the
other property received that is not distrib-
uted.
Section 361(c)(2)(A) provides that, if
the acquiring corporation distributes prop-
erty other than qualified property (defined
in § 361(c)(2)(B)), and the fair market
value of such property exceeds its ad-
justed basis, then gain will be recognized
as if such property were sold to the dis-
tributee at its fair market value.
Section 368(a)(1)(D) includes within
the definition of “reorganization” a trans-
fer by a corporation of part of its assets to
another corporation if immediately after
the transfer the transferor is in control
of the corporation to which the assets are
transferred and the transferor distributes
the stock in a transaction that qualifies
under § 354, § 355, or § 356.
Section 368(c) defines “control” as
ownership of stock possessing at least 80
percent of the total combined voting
power of all classes of stock entitled to
vote and at least 80 percent of the total
number of shares of all other classes of
stock of the corporation.
Section 1001(a) provides that the gain
from the sale or other disposition of prop-
erty will be the excess of the amount
realized therefrom over the adjusted basis
provided in section 1011 for determining
gain, and the loss will be the excess of the
adjusted basis provided in such section for
determining loss over the amount realized.
Section 1001(c) provides that except as
otherwise provided in subtitle A of the
Code, the entire amount of the gain or
loss, determined under § 1001, on the sale
or exchange of property will be recog-
nized.
Section 1032(a) provides that no gain
or loss will be recognized to a corporation
on the receipt of money or other property
in exchange for stock (including treasury
stock) of such corporation.
Section 1.1002–1(c) provides, in part,
with respect to §§ 351 and 361, that the
underlying assumption of these excep-
tions to the recognition of gain or loss
under § 1001 is that the new property is
substantially a continuation of the old in-
vestment still unliquidated; and in the case
of reorganizations, that the new enter-
prise, the new corporate structure, and the
new property are substantially continua-
tions of the old still unliquidated.
In Rev. Rul. 74 –79, 1974 –1 C.B. 81,
the Internal Revenue Service (Service)
ruled that § 355(b)(1)(A)’s requirement
that the distributing corporation be en-
gaged in an active trade or business was
satisfied where the distributing corpora-
tion was an inactive holding company,
and a subsidiary of the distributing corpo-
ration engaged in a § 332 liquidation for
the purpose of transferring its active trade
or business to the distributing corporation.
In Rev. Rul. 2003–51, 2003–1 C.B.
938, a person (transferor) transferred as-
sets to a corporation (first corporation) in
exchange for an amount of stock in the
first corporation constituting control (first
transfer). Pursuant to a binding agreement
entered into by the transferor with a third
party prior to the first transfer, (i) the
transferor transferred the stock of the first
corporation (second transfer) to another
corporation (second corporation); (ii) the
third party transferred money to the sec-
ond corporation (third transfer); and(iii)
the second corporation transferred the
money transferred to it by the third party
to its wholly-owned subsidiary, the first
corporation. Immediately after these
transactions, the transferor and the third
party were in control of the second cor-
poration, and the second corporation
was in control of the first corporation.
The Service ruled that the first transfer
satisfied the control requirement of
§ 351(a) notwithstanding the second
transfer. The Service concluded that the
second transfer, a nontaxable disposi-
tion of the stock received in the first
transfer, was not inconsistent with the
purposes of § 351 because the transac-
tion lacked the characteristics of a sale
and the transferor retained beneficial
ownership in the assets transferred to
the first corporation.
InEstates of Bell v. Comm’r, T.C.M.
1971–285, the Tax Court explained that
sales of assets between a taxpayer’s
wholly-owned corporations followed by
liquidating distributions “literally comply
with the provisions of the Code dealing
with complete liquidations, sections 331,
332, and 337, butin substanceaccomplish
a reorganization coupled with the distri-
bution of a dividend.” (Emphasis added.)
The court went on to state that, because
§ 356 is “the exclusive measure of div-
idend income provided by Congress
where money is distributed to share-
holders as an incident of a reorganiza-
tion,” § 301 and § 1.301–1(l) were not
applicable to the acquisitive reorganiza-
tion under § 368(a)(1)(D).
ANALYSIS
Situation 1: The federal income tax
consequences toPandDin Situation 1
will depend on whether the Date 1 and
Date 2 transfers are treated as separate
transactions. Because they are undertaken
pursuant to the same overall plan, a ques-
tion arises as to whether the two transac-
tions are part of a single reciprocal trans-
fer of property—an exchange.
If the Date 1 and Date 2 transfers are
respected as separate transactions for fed-
eral income tax purposes,Pwould be
treated as transferring property toDon
Date 1 forDstock in an exchange to
which § 351 applies, andDwould be
treated as distributing all the stock ofCto
Pon Date 2 in a distribution to which
§ 355 applies (assuming the requirements
under those Code sections are otherwise
satisfied).
If the Date 1 and Date 2 transfers are
integrated into a single exchange for fed-
eral income tax purposes,Pwould be
treated as transferring its Business A
property toDin exchange for a portion of
theCstock in an exchange to which
§ 1001 applies. In such an exchange,
gain or loss would be recognized toPon
the transfer of its property toD; gain or
loss would be recognized toD, under
§ 1001(a), upon its transfer of 25 percent
Bulletin No. 2017–21May 22, 2017
1245

of theCstock toPin exchange for the
property transferred to it. In addition,
§ 355 would not apply to any part of the
distribution ofCstock becauseDwould
not have distributed stock constituting
§ 368(c) control ofC. Gain would be
recognized toD, under § 311(b), upon the
distribution of the remaining 75 percent of
theCstock with respect toP’s stock inD
to which § 301 would apply.
The determination of whether steps of
a transaction should be integrated requires
review of the scope and intent underlying
each of the implicated provisions of the
Code. The tax treatment of a transaction
generally follows the taxpayer’s chosen
form unless: (1) there is a compelling al-
ternative policy; (2) the effect of all or
part of the steps of the transaction is to
avoid a particular result intended by
otherwise-applicable Code provisions; or
(3) the effect of all or part of the steps of
the transaction is inconsistent with the un-
derlying intent of the applicable Code pro-
visions.See H.B. Zachry Co. v. Comm’r,
49 T.C. 73 (1967);Makover v. Comm’r,
T.C. Memo 1967–53; Rev. Rul. 78 –330,
1978 –2 C.B. 147. Sections 351, 355, and
368 generally allow continued ownership
of property in modified corporate form
without recognition of gain.See American
Compress & Warehouse Co. v. Bender,70
F.2d 655 (5th Cir. 1934),cert. denied, 293
U.S. 607 (1934); § 1.1002–1(c); Rev. Rul.
2003–51.
Section 355(b)(2)(C) and (D) permit
the direct and indirect acquisition of an
active trade or business by a corporation
within the 5–year period ending on the
date of a distribution in transactions in
which no gain or loss was recognized. The
intent of § 355(b)(2)(C) and (D) is to
prevent the acquisition of a trade or busi-
ness by the distributing corporation or the
controlled corporation from an outside
party in a taxable transaction within the
5–year pre-distribution period.SeeRev.
Rul. 78 – 442, 1978 –2 C.B. 143 (holding
that § 357(c) gain arising from a § 351
transfer of an active trade or business does
not violate § 355(b)(2)(C)). These provi-
sions ensure that transfers of assets in
transactions eligible for nonrecognition
treatment (nonrecognition transactions)
throughout the 5–year period will not ad-
versely impact an otherwise qualifying
§ 355 distribution. This principle is illus-
trated in Rev. Rul. 74 –79, in which an
active trade or business was transferred to
a distributing corporation in a § 332 liq-
uidation to satisfy the requirements of
§ 355(b).
The transfer of property permitted to
be received byDin a nonrecognition
transaction has independent significance
when undertaken in contemplation of a
distribution byDof stock and securities
described in § 355(a)(1)(A). The transfer
thus is respected as a separate transaction,
regardless of whether the purpose of the
transfer is to qualify the distribution under
§ 355(b).See,e.g., Rev. Rul. 78 –330;
§ 1.355– 6(d)(3)(v)(B), Example 1; and
Athanasios v. Comm’r, T.C. Memo 1995–
72. Back-to-back nonrecognition transfers
are generally respected when consistent
with the underlying intent of the applica-
ble Code provisions and there is no com-
pelling alternative policy.See,e.g., Rev.
Rul. 2015–9, 2015–21 I.R.B. 972, and
Rev. Rul. 2015–10, 2015–21 I.R.B. 973.
P’stransfer on Date 1 is the type of
transaction to which § 351 is intended to
apply. Analysis of the transaction as a
whole does not indicate thatP’stransfer
should be properly treated other than in
accordance with its form. Each step pro-
vides for continued ownership in modified
corporate form. Additionally, the steps do
not resemble a sale, and none of the inter-
ests are liquidated or otherwise redeemed.
On these facts, nonrecognition treatment
under §§ 351 and 355 is not inconsistent
with the congressional intent of these
Code provisions. The effect of the steps in
Situation 1 is consistent with the policies
underlying §§ 351 and 355. Accordingly,
the Date 1 and Date 2 transfers described
in Situation 1 will be respected as separate
transactions for federal income tax pur-
poses. Therefore, § 351 applies toP’s
transfer on Date 1 and § 355 applies to
D’s transfer on Date 2.
The federal income tax consequences
would be the same (qualification under
§ 355) if, instead of acquiring an active
trade or business in a § 351 transfer from
PtoD,Dacquired an active trade or
business from a subsidiary ofPin a cross-
chain reorganization under § 368(a)(1).
SeeRev. Rul. 74 –79.
Situation 2: If the distribution byCof
money and other property on Date 1 is
treated as separate from the distribution of
Cstock, § 301 would apply toD’s receipt
of the money and other property fromC
,
and no gain would be recognized toD
upon the transfer of property toC.
If the Date 1 distribution is treated as
made in pursuance of the plan of reorga-
nization under §§ 368(a)(1)(D) and 355
that includes the Date 2 distribution ofC
stock, the money and other property dis-
tributed byCtoDwould constitute boot
toD, and, under § 361(b)(1)(B), gain
would be recognized toDon its transfer
of property toCto the extent of the
amount of the money and the fair market
value of the property. Section 361(b) re-
quires gain recognition toDif boot is
distributed toDand not further distributed
byDto its shareholders or creditors in
pursuance of the plan of reorganization
unless the facts establish that the distribu-
tion is in substance a separate transaction.
Cf., Rev. Rul. 71–364, 1971–2 C.B. 182
(finding that a distribution of money de-
clared and paid following a reorganization
exchange is treated as boot in the reorga-
nization).
As noted above, inEstates of Bell v.
Comm’r, the Tax Court explained that the
boot rules are “the exclusive measure of
dividend income provided by Congress
where cash is distributed to shareholders
as an incident of a reorganization.”See
also American Manufacturing. Co. v.
Comm’r, 55 T.C. 204 (1970). Section 361
broadly looks to whether transfers of
money or other property occur “in pursu-
ance of the plan of reorganization” or “in
connection with the reorganization.”
In Situation 2, the distribution is
made in pursuance of the plan of reor-
ganization. A distribution of money and
other property in pursuance of the plan
of reorganization will be treated as boot
subject to recognition of gain, consistent
with the congressional intent underlying
§ 361.
Therefore, the federal income tax treat-
ment of the transaction will follow its
substance, and the distribution of money
and property byCtoDwill constitute a
distribution of boot under § 361(b).
HOLDINGS
(1) In Situation 1, the transfer byPto
its subsidiary,D, of property (in-
cluding atransfer of property consti-
tuting an active trade or business for
May 22, 2017Bulletin No. 2017–21
1246

the purpose of meeting the require-
ments of § 355(b)(1)(A)), immedi-
ately followed by the distribution by
DtoPof the stock of its controlled
subsidiary,C, is treated as an ex-
change to which § 351 applies, fol-
lowed by a distribution ofCstock to
which § 355 applies.
(2) In Situation 2, § 361, and not
§ 301, applies to the transfer of
money or other property byCto
Dmade in pursuance of the plan
of reorganization under §§ 368(a)
(1)(D) and 355.
EFFECT ON OTHER DOCUMENTS
Rev. Proc. 2017–3, 2017–1 I.R.B.
130, is modified by deleting section 5.02
(with respect to steps in North-South
transactions). However, the Service may
decline to issue a letter ruling address-
ing the integration of steps when appro-
priate in the interest of sound tax admin-
istration or on other grounds when
warranted by the facts or circumstances
of a particular case. There are also areas
in which the Service will not issue letter
rulings or determination letters because
the issues areinherently factual, in the
interest of sound tax administration, and
other reasons.SeeRev. Proc. 2017–1,
2017–1 I.R.B. 1, section 6.02; Rev. Proc.
2017–3, sections 2.01 and 3.01(51).
DRAFTING INFORMATION
The principal author of this revenue
ruling is Susan E. Massey of the Office of
Associate Chief Counsel (Corporate). For
further information regarding this revenue
ruling, contact Susan E. Massey at (202)
317-5024 (not a toll-free number).
Bulletin No. 2017–21May 22, 2017
1247

Part III. Administrative, Procedural, and Miscellaneous
Temporary Relief for Fuel
Removals Due to Energy
Emergencies Resulting
from West Shore Pipeline
Shutdown
Notice 2017–30
SECTION 1. PURPOSE
This notice provides 180 – day emer-
gency relief for fuel removals from Mil-
waukee terminals due to energy emergen-
cies resulting from the shutdown of the
West Shore Pipeline. Once the 180 – day
emergency relief described in this notice
expires, there will be subsequent tempo-
rary relief that provides a mechanism for
refunds of the § 4081(a)(1) tax imposed
upon removals of undyed diesel fuel and
kerosene from the Milwaukee terminals
when such fuel is subsequently removed
from the Green Bay terminals as dyed fuel
destined for a nontaxable use.
SECTION 2. BACKGROUND
.01 West Shore Pipeline Shutdown
The West Shore Pipeline is a 650 –mile
pipeline system that has transported re-
fined petroleum products to the northeast-
ern part of Wisconsin for over 50 years.
The West Shore Pipeline is the only fuel
pipeline serving Green Bay and northeast-
ern Wisconsin. The West Shore Pipeline
segment between the cities of Milwaukee
and Green Bay closed on March 10, 2016,
for repairs, testing, and inspections. On
June 22, 2016, this segment of the West
Shore Pipeline was shut down indefinitely
after integrity concerns were detected. On
April 21, 2017, the Wisconsin Department
of Administration issued a statement that
this segment of the West Shore Pipeline
will not be replaced. Due to this unantic-
ipated shut down and the decision that this
section of the pipeline will not be replaced
or reactivated, the areas of Green Bay and
northeast Wisconsin are expected to have
material fuel shortages for a relatively
long period of time. In response to this
shut down and the resulting fuel short-
ages, Wisconsin Governor Scott Walker
issued Executive Orders on May 6, 2016,
September 7, 2016, and November 4,
2016, declaring energy emergencies.
Fuel is currently being removed from
the Milwaukee terminals and transported
via tank trucks and/or rail cars to Green
Bay terminals in order to mitigate and
avoid material fuel shortages and supply
fuel to the northern portion of Wisconsin
during the West Shore Pipeline outage.
Aside from vessels, transporting fuel via
tank trucks and rail cars is the only way to
get fuel to Green Bay for distribution now
that the pipeline is permanently shut
down.
.02 Law
Section 4081(a)(1)(A)(ii) imposes tax
on the removal of taxable fuel, which in-
cludes gasoline and diesel fuel, from any
terminal.
Section 48.4081–1(b) of the Manufac-
turers and Retailers Excise Taxes Regula-
tions defines “removal” as any physical
transfer of taxable fuel, and any use
of taxable fuel other than as a material in
the production of taxable fuel or special
fuels. Taxable fuel is not removed when it
evaporates or is otherwise lost or de-
stroyed.
Section 4081(a)(1)(B)(i) provides an
exemption from the tax imposed by
§ 4081(a)(1)(A) for removals of taxable
fuel transferred in bulk by pipeline or ves-
sel to registered terminals.
Section 48.4081–2 provides the rules
regarding tax on the removal of taxable
fuel at the terminal rack.
Section4081(a)(2)(A)(i) prescribes a
tax rate of 18.3 cents per gallon of
gasolineforthetaximposedby
§ 4081(a)(1)(A).
Section 4081(a)(2)(B) imposes an ad-
ditional tax of 0.1 cent per gallon (referred
to as Leaking Underground Storage Tank
Trust Fund tax or the LUST tax).
Section 4081(a)(2)(A)(iii) prescribes a
tax rate of 24.3 cents per gallon of diesel
fuel or kerosene for the tax imposed by
§ 4081(a)(1)(A). Section 4081(a)(2)(B)
imposes an additional LUST tax of 0.1
cent per gallon.
Section 4081(e) provides that, under
regulations prescribed by the Secretary, if
any person who paid the tax imposed by
§ 4081 with respect to any taxable fuel
establishes to the satisfaction of the Sec-
retary that a prior tax was paid (and not
credited or refunded) with respect to such
taxable fuel, then an amount equal to the
tax paid by such person shall be allowed
as a refund (without interest) to such per-
son in the same manner as if it were an
overpayment of tax imposed by section
4081.
Section 48.4081–7 sets forth the re-
porting requirements and other conditions
for claiming a refund under § 4081(e).
Section 4082 provides that the tax im-
posed by § 4081 does not apply to diesel
fuel and kerosene that is indelibly dyed in
accordance with Treasury regulations,
meets any marking requirements pre-
scribed by Treasury regulations, and is
destined for a nontaxable use.
.03 Reasons for Relief
Under existing law, tax is imposed un-
der § 4081(a)(1) upon the removal of tax-
able fuel from the Milwaukee terminals
(referred to as the first tax). The taxable
fuel that is transported to and entered into
the Green Bay terminals is subject to a
second § 4081(a)(1) tax upon removal
from the Green Bay terminals (referred to
as the second tax). Section 4081(e) and
§ 48.4081–7 provide a refund mechanism
that allows the person who pays the sec-
ond tax, i.e., the position holder in Green
Bay, to claim a refund (but not a credit) in
the amount of the second tax paid (with-
out interest). In the case of dyed fuel,
there is no mechanism in existing law that
allows a refund for taxable fuel that is
removed from a Milwaukee terminal,
transported to and entered into a Green
Bay terminal, and dyed pursuant to the
provisions of § 4082.
The Treasury Department and the In-
ternal Revenue Service (IRS) recognize
that position holders in Milwaukee will
need time to adjust sales contracts and
business practices and to explore the pos-
sibility of increasing bulk transfers via
vessel in order to account for the imposi-
tion of the § 4081(a)(1) tax upon the re-
moval of taxable fuel from the Milwaukee
terminals now that the West Short Pipe-
line is permanently closed. Accordingly,
May 22, 2017Bulletin No. 2017–21
1248

the Treasury Department and the IRS
are providing temporary emergency relief
from the removal rules under § 4081(a)
(1)(A) and § 48.4081–2(b) for a period of
180 days, subject to the conditions in sec-
tion 3 of this notice. This relief will tem-
porarily put position holders in the Mil-
waukee terminals in the same position as
they were prior to the shutdown of the
West Shore pipeline. Following the expi-
ration of the temporary emergency relief
described in section 3.01 of this notice,
relief is available through § 4081(e),
which allows position holders in the
Green Bay terminals to claim a refund
(but not a credit) of the second tax im-
posed upon the removal of taxable fuel
from the Green Bay terminals.
The Treasury Department and the IRS
also recognize that there is no mechanism
under existing law that permits a refund of
the § 4081(a)(1) tax imposed upon re-
moval of taxable fuel from a Milwaukee
terminal when that fuel is transported to
and entered into a Green Bay terminal,
and then removed from the Green Bay
terminal as dyed fuel destined for a non-
taxable use. Accordingly, the Treasury
Department and the IRS are providing a
temporary refund mechanism for the first
tax paid on the taxable fuel when it is
removed from a Milwaukee terminal,
transported to and entered into a Green
Bay terminal, and later removed from that
Green Bay terminal as dyed fuel destined
for a nontaxable use. Under this tempo-
rary relief, the person who dyes the fuel at
the rack in Green Bay will be allowed to
claim a refund (without interest) of the
first tax. Therefund provision under this
temporary relief will be similar to the refund
provision for taxable fuel under § 4081(e) in
that the same person is allowed to make the
claim for refund (i.e., the position holder
who removes the taxable or dyed fuel from
the Green Bay terminal).
SECTION 3. TEMPORARY RELIEF
.01 180 –Day Emergency Relief
For the period beginning on May 3,
2017 and ending on October 30, 2017, tax
will be imposed under § 4081(a)(1)(A)(ii)
and § 48.4081–2(b) on the removal of
taxable fuel from a terminal rack in Mil-
waukee, unless the fuel is transported by
tank truck or rail car and entered into a
Green Bay terminal within 24 hours of its
removal from the Milwaukee terminal. If
such fuel is entered into a Green Bay
terminal within 24 hours of its removal
from a Milwaukee terminal, the fuel will
be subject to tax under § 4081(a)(1)(A)(ii)
upon its removal from the Green Bay
terminal rack, unless § 4082 applies.
All existing rules under § 4081 and
§ 48.4081–2 apply once the fuel removed
from a Milwaukee terminal is entered into
a Green Bay terminal in accordance with
the requirements prescribed in this sec-
tion.
This relief is subject to satisfaction of
all of the conditions to relief set forth in
section 3.03 of this notice. Upon the
termination of this 180 – day emergency
relief, the normal rules of § 4081(a)
(1)(A)(ii) and § 48.4081–2(b) will apply
to removals of taxable fuel from the Mil-
waukee terminals.
.02 Temporary Dyed Fuel Relief
For the period beginning on October
31, 2017, and ending on May 3, 2018, if
any person who removes diesel fuel or
kerosene that satisfies the requirements of
§ 4082 from a Green Bay terminal estab-
lishes to the satisfaction of the Secretary
that a prior tax was paid with respect to
the removal of such fuel from a Milwau-
kee terminal, then an amount equal to the
prior tax paid shall be allowed as a refund
(without interest) to such person in the
same manner as if it were an overpayment
of tax imposed by § 4081. No refund will
be allowed unless the fuel removed from a
Milwaukee terminal was transported by
tank truck or rail car and entered into a
Green Bay terminal within 24 hours of its
removal from the Milwaukee terminal.
The Treasury Department and the IRS
will publish guidance on how to submit
claims for refund pursuant to this section
3.02 prior to the expiration of the relief
described in section 3.01 of this notice.
The relief in this section 3.02 will be
subject to satisfaction of all of the condi-
tions to relief set forth in section 3.03 of
this notice.
.03 Conditions to Relief
The relief granted in sections 3.01 and
3.02 of this notice is available only if all
of the following conditions are satisfied:
(1) The segment of the West Shore Pipe-
line between Milwaukee and Green
Bay remains permanently and com-
pletely shut down.
(2) All operators of terminals from which
fuel is removed or entered pursuant to
the relief granted in sections 3.01 and
3.02 of this notice must timely and
accurately satisfy Excise Summary
Terminal Activity Reporting System
(ExSTARS) reporting obligations by
filing Form 720 –TO, Terminal Oper-
ator Report, as required by § 4101(d)
and § 48.4101–1(h)(1)(iii). Form
720 –TO filers are reminded of the in-
formation reporting requirements un-
der § 4101(d) and the penalty provi-
sions of § 6725 for any failure to
report and any failure to include all of
the information required to be shown
on such report or the inclusion of in-
correct information.
(3) All position holders with respect to
fuel removed or entered pursuant to
the relief granted in sections 3.01 and
3.02 of this notice must keep records
pursuant to § 48.4101–1(h)(1)(ii) that
sufficiently show tax liability under
§ 4081 and payments or deposits of
such liability.
(4) The same person who removes taxable
fuel from a Milwaukee terminal (i.e.,
the position holder in the Milwaukee
terminal) must enter the fuel into a
Green Bay terminal within 24 hours of
its removal from the Milwaukee ter-
minal.
The relief set forth in sections 3.01 and
3.02 of this notice is not available with
respect to any transaction for which one or
more conditions set forth in this section
3.03 are not satisfied.
SECTION 4. EFFECTIVE DATES
The 180 – day emergency relief pro-
vided in section 3.01 of this notice applies
to removals from Milwaukee terminals on
or after May 3, 2017, and before October
31, 2017.
The temporary dyed fuel relief pro-
vided in section 3.02 of this notice applies
to removals of diesel fuel and kerosene
from Green Bay terminals on or after Oc-
tober 31, 2017, and before May 4, 2018.
Bulletin No. 2017–21May 22, 2017
1249

SECTION 5. DRAFTING
INFORMATION
The principal author of this notice is the
Office of Associate Chief Counsel (Pass-
throughs & Special Industries). For further
information regarding this notice contact
(202) 317-6855 (not a toll-free number).
26 CFR 601.601: Rules and Regulations.
(Also Part I, §§ 25, 103, 143; 1.25– 4T, 1.103–1,
6a.103A–2.)
Rev. Proc. 2017–35
SECTION 1. PURPOSE
This revenue procedure provides guid-
ance with respect to the United States and
area median gross income figures that are
to be used by issuers of qualified mort-
gage bonds, as defined in § 143(a) of the
Internal Revenue Code, and issuers of
mortgage credit certificates, as defined in
§ 25(c), in computing the income require-
ments described in § 143(f).
SECTION 2. BACKGROUND
.01 Section 103(a) provides that, ex-
cept as provided in § 103(b), gross income
does not include interest on any state or
local bond. Section 103(b)(1) provides
that § 103(a) shall not apply to any private
activity bond that is not a qualified bond
(within the meaning of § 141). Section
141(e) provides that the term “qualified
bond” includes any private activity bond
that (1) is a qualified mortgage bond, (2)
meets the applicable volume cap require-
ments under § 146, and (3) meets the
applicable requirements under § 147.
.02 Section 143(a)(1) provides that the
term “qualified mortgage bond” means a
bond that is issued as part of a “qualified
mortgage issue”. Section 143(a)(2)(A)
provides that the term “qualified mortgage
issue” means an issue of one or more
bonds by a state orpolitical subdivision
thereof, but only if (i) all proceeds of the
issue (exclusive of issuance costs and a rea-
sonably required reserve) are to be used to
finance owner-occupied residences; (ii) the
issue meets the requirements of subsections
(c), (d), (e), (f), (g), (h), (i), and (m)(7) of
§ 143; (iii) the issue does not meet the
private business tests of paragraphs (1)
and (2) of § 141(b); and (iv) with re-
spect to amounts received more than 10
years after the date of issuance, repay-
ments of $250,000 or more of principal
on financing provided by the issue are
used not later than the close of the first
semi-annual period beginning after the
date the prepayment (or complete repay-
ment) is received to redeem bonds that
are part of the issue.
.03 Section 143(f) imposes eligibility
requirements concerning the maximum
income of mortgagors for whom financing
may be provided by qualified mortgage
bonds. Section 25(c)(2)(A)(iii)(IV) pro-
vides that recipients of mortgage credit
certificates must meet the income require-
ments of § 143(f). Generally, under
§§ 143(f)(1) and 25(c)(2)(A)(iii)(IV),
these income requirements are met only if
all owner-financing under a qualified
mortgage bond and all certified indebted-
ness amounts under a mortgage credit cer-
tificate program are provided to mortgag-
ors whose family income is 115 percent or
less of the applicable median family in-
come. Under § 143(f)(6), the income lim-
itation is reduced to 100 percent of the
applicable median family income if there
are fewer than three individuals in the
family of the mortgagor.
.04 Section 143(f)(4) provides that the
term “applicable median family income”
means the greater of (A) the area median
gross income for the area in which the
residence is located, or (B) the statewide
median gross income for the state in
which the residence is located.
.05 Section 143(f)(5) provides for an
upward adjustment of the income limita-
tions in certain high housing cost areas.
Under § 143(f)(5)(C), a high housing cost
area is a statistical area for which the
housing cost/income ratio is greater than
1.2. The housing cost/income ratio is de-
termined under § 143(f)(5)(D) by dividing
(a) the applicable housing price ratio by
(b) the ratio that the area median gross
income bears to the median gross income
for the United States. The applicable
housing price ratio is the new housing
price ratio (new housing average purchase
price for the area divided by the new
housing average purchase price for the
United States) or the existing housing
price ratio (existing housing average area
purchase price divided by the existing
housing average purchase price for the
United States), whichever results in the
housing cost/income ratio being closer to
1. This income adjustment applies only
to bonds issued, and nonissued bond
amounts elected, after December 31,
1988.See§ 4005(h) of the Technical and
Miscellaneous Revenue Act of 1988,
1988 –3 C.B. 1, 311 (1988).
.06 The Department of Housing and
Urban Development (HUD) has computed
the median gross income for the United
States, the states, and statistical areas
within the states. The income information
was released to the HUD regional offices
on April 14, 2017, and may be obtained
by calling the HUD reference service at
1-800-245-2691. The income information
is also available at HUD’s World Wide
Web site,http://www.huduser.gov/portal/
datasets/il.html, which provides a menu
from which you may select the year and
type of data of interest.
.07 The most recent nationwide aver-
age purchase prices and average area pur-
chase price safe harbor limitations were
published on April 03, 2017, in Rev. Proc.
2017–27, 2017–14 I.R.B. 1042.
SECTION 3. APPLICATION
.01 When computing the income re-
quirements of § 143(f), issuers of qualified
mortgage bonds and mortgage credit cer-
tificates must use either (1) the median
gross income for the United States, the
states, and statistical areas within the
states, as released to the HUD regional
offices on March 28, 2016, or (2) the
median gross income for the United
States, the states, and statistical areas
within the states, as released to the HUD
regional offices on April 14, 2017.
.02 If an issuer uses the median gross
income for the United States, the states,
and statistical areas within the states, as
released to the HUD regional offices on
March 28, 2016, to compute the housing
cost/income ratio under § 143(f)(5), the
issuer must use the median gross income
for the United States, the states, and sta-
tistical areas within the states, as released
to the HUD regional offices on March 28,
2016, for all purposes under § 143(f).
Likewise, if anissuer uses the median gross
income for the United States, the states, and
statistical areas within the states, as released
to the HUD regional offices on April 14,
2017, to compute the housing cost/income
May 22, 2017Bulletin No. 2017–21
1250

ratio under § 143(f)(5), the issuer must use
the median gross income for the United
States, the states, and statistical areas within
the states, as released to the HUD regional
offices on April 14, 2017, for all purposes
under § 143(f).
SECTION 4. EFFECT ON OTHER
REVENUE PROCEDURES
.01 Rev. Proc. 2016 –26, 2016 –22
I.R.B. 1018, is obsolete except as pro-
vided in §§ 3.01, 3.02, or 5.01 of this
revenue procedure.
.02 This revenue procedure does not
affect the effective date provisions of Rev.
Rul. 86 –124, 1986 –2 C.B. 27. Those ef-
fective date provisions will remain opera-
tive at least until the Service publishes a
new revenue ruling that conforms the ap-
proach to effective dates set forth in Rev.
Rul. 86 –124 to the general approach
taken in this revenue procedure.
SECTION 5. EFFECTIVE DATES
.01 Issuers must use the United States
and area median gross income figures
specified in § 3.01 of this revenue proce-
dure for commitments to provide financ-
ing that are made, or (if the purchase
precedes the financing commitment) for
residences that are purchased, in the pe-
riod that begins on April 14, 2017, and
ends on the date when these United States
and area median gross income figures are
rendered obsolete by a new revenue pro-
cedure.
DRAFTING INFORMATION
The principal authors of this revenue
procedure are David White and Timothy
Jones of the Office of Associate Chief
Counsel (Financial Institutions & Prod-
ucts). For further information regarding
this revenue procedure contact Mr. White
or Mr. Jones at (202) 317-6980 (not a
toll-free number).
Rev. Proc. 2017–36
SECTION 1. PURPOSE
This revenue procedure provides in-
dexing adjustments for certain provisions
under sections 36B and 5000A of the In-
ternal Revenue Code. In particular, it up-
dates the Applicable Percentage Table in
§ 36B(b)(3)(A)(i) to provide the Applica-
ble Percentage Table for 2018. This table
is used to calculate an individual’s pre-
mium tax credit. This revenue procedure
also updates the required contribution per-
centage in § 36B(c)(2)(C)(i)(II) for plan
years beginning after calendar year 2017.
The percentage is used to determine
whether an individual is eligible for af-
fordable employer-sponsored minimum
essential coverage under § 36B. This rev-
enue procedure uses the methodology de-
scribed in Section 4 of Rev. Proc. 2014 –
37, 2014 –2 C.B.363, to index the
Applicable Percentage Table and the § 36B
required contribution percentage for 2018.
Additionally, this revenue procedure cross-
references the required contribution percent-
age under § 5000A(e)(1)(A) for plan years
beginning after calendar year 2017, as de-
termined under guidance issued by the De-
partment of Health and Human Services.
The percentage is used to determine
whether an individual is eligible for an ex-
emption from the individual shared respon-
sibility payment because of a lack of afford-
able minimum essential coverage.
SECTION 2. ADJUSTED ITEMS
.01Applicable Percentage Table for
2018. For taxable years beginning in
2018, the Applicable Percentage Table
for purposes of § 36B(b)(3)(A)(i) and
§ 1.36B–3T(g) is:
Household income percentage of Federal poverty line:Initial percentageFinal percentage
Less than 133%2.01%2.01%
At least 133% but less than 150%3.02%4.03%
At least 150% but less than 200%4.03%6.34%
At least 200% but less than 250%6.34%8.10%
At least 250% but less than 300%8.10%9.56%
At least 300% but not more than 400%9.56%9.56%
.02Section 36B Required Contribution
Percentage for 2018. For plan years begin-
ning in 2018, the required contribution per-
centage for purposes of § 36B(c)(2)(C)(i)
(II) and § 1.36B–2T(c)(3)(v)(C) is 9.56%.
.03Section 5000A Required Contribu-
tion Percentage. In the 2018 Benefit and
Payment Parameters, 81 Fed. Reg. 94058
(December 22, 2016), for plan years be-
ginning in 2018, the Department of Health
and Human Services (HHS) announced
that the Section 5000A required contribu-
tionpercentageforpurposesof
§ 5000A(e)(1)(A) and § 1.5000A–3(e)(2)
is 8.05%.SeeExchange and Insurance
Market Standards for 2015 and beyond,
79 Fed. Reg. 30239, 30302 (May 27,
2014), for further information on the com-
putation methodology and publication ap-
proach for the Section 5000A required
contribution percentage.
SECTION 3. EFFECTIVE DATE
This revenue procedure is effective for
taxable years and plan years beginning
after December 31, 2017.
SECTION 4. DRAFTING
INFORMATION
The principal author of this revenue
procedure is Bill Ruane of the Office of
Associate Chief Counsel (Income Tax and
Accounting). For further information re-
garding this revenue procedure, contact
Mr. Bill Ruane at (202) 317-4718 (not a
toll-free number).
Bulletin No. 2017–21May 22, 2017
1251

26 CFR 601.602: Tax forms and instructions.
(Also Part 1, §§ 1, 223.)
Rev. Proc. 2017–37
SECTION 1. PURPOSE
This revenue procedure provides the
2018 inflation adjusted amounts for Health
Savings Accounts (HSAs) as determined
under § 223 of the Internal Revenue Code.
SECTION 2. 2018 INFLATION
ADJUSTED ITEMS
Annual contribution limitation. For
calendar year 2018, the annual limitation
on deductions under § 223(b)(2)(A) for an
individual with self-only coverage under a
high deductible health plan is $3,450. For
calendar year 2018, the annual limitation
on deductions under § 223(b)(2)(B) for an
individual with family coverage under a
high deductible health plan is $6,900.
High deductible health plan. For cal-
endar year 2018, a “high deductible health
plan” is defined under § 223(c)(2)(A) as a
health plan with an annual deductible that
is not less than $1,350 for self-only
coverage or $2,700 for family coverage,
and the annual out-of-pocket expenses
(deductibles, co-payments, and other
amounts, but not premiums) do not exceed
$6,650 for self-only coverage or $13,300
for family coverage.
SECTION 3. EFFECTIVE DATE
This revenue procedure is effective for
calendar year 2018.
SECTION 4. DRAFTING
INFORMATION
The principal author of this revenue pro-
cedure is Bill Ruane of the Office of Asso-
ciate Chief Counsel (Income Tax & Ac-
counting). For further information regarding
§ 223 and HSAs, contact Karen Levin at
(202) 317-5500 (not a toll-free number). For
further information regarding the calcula-
tion of the inflation adjustments in this rev-
enue procedure, contact Mr. Ruane at (202)
317-4718 (not a toll-free number).
May 22, 2017Bulletin No. 2017–21
1252

Definition of Terms
Revenue rulings and revenue procedures
(hereinafter referred to as “rulings”) that
have an effect on previous rulings use the
following defined terms to describe the
effect:
Amplifieddescribes a situation where
no change is being made in a prior pub-
lished position, but the prior position is
being extended to apply to a variation of
the fact situation set forth therein. Thus, if
an earlier ruling held that a principle ap-
plied to A, and the new ruling holds that
the same principle also applies to B, the
earlier ruling is amplified. (Compare with
modified, below).
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 pub-
lished ruling and points out an essential
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 published position. (Compare
withamplifiedandclarified, above).
Obsoleteddescribes a previously pub-
lished ruling that is not considered deter-
minative with respect to future transac-
tions. This term is most commonly used in
a ruling that lists previously published rul-
ings that are obsoleted because of changes
in laws or regulations. A ruling may also
be obsoleted because the substance has
been included in regulations subsequently
adopted.
Revokeddescribes situations where the
position in the previously published ruling
is not correct and the correct position is
being stated in a 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 previously published over a pe-
riod of time in separate rulings. If the new
ruling does more than restate the sub-
stance of a prior ruling, a combination of
terms is used. For example,modifiedand
supersededdescribes a situation where the
substance of a previously published ruling
is being changed in part and is continued
without change in part and it is desired to
restate the valid portion of the previously
published ruling in a new ruling that is
self contained. In this case, the previously
published ruling is first modified and then,
as modified, is superseded.
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 rul-
ings 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 ma-
terial published in the Bulletin.
A—Individual.
Acq.—Acquiescence.
B—Individual.
BE—Beneficiary.
BK—Bank.
B.T.A.—Board of Tax Appeals.
C—Individual.
C.B.—Cumulative Bulletin.
CFR—Code of Federal Regulations.
CI—City.
COOP—Cooperative.
Ct.D.—Court Decision.
CY—County.
D—Decedent.
DC—Dummy Corporation.
DE—Donee.
Del. Order—Delegation Order.
DISC—Domestic International Sales Corporation.
DR—Donor.
E—Estate.
EE—Employee.
E.O.—Executive Order.
ER—Employer.
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduciary.
FC—Foreign Country.
FICA—Federal Insurance Contributions Act.
FISC—Foreign International Sales Company.
FPH—Foreign Personal Holding Company.
F.R.—Federal Register.
FUTA—Federal Unemployment Tax Act.
FX—Foreign corporation.
G.C.M.—Chief Counsel’s Memorandum.
GE—Grantee.
GP—General Partner.
GR—Grantor.
IC—Insurance Company.
I.R.B.—Internal Revenue Bulletin.
LE—Lessee.
LP—Limited Partner.
LR—Lessor.
M—Minor.
Nonacq.—Nonacquiescence.
O—Organization.
P—Parent Corporation.
PHC—Personal Holding Company.
PO—Possession of the U.S.
PR—Partner.
PRS—Partnership.
PTE
—Prohibited Transaction Exemption.
Pub. L.—Public Law.
REIT—Real Estate Investment Trust.
Rev. Proc.—Revenue Procedure.
Rev. Rul.—Revenue Ruling.
S—Subsidiary.
S.P.R.—Statement of Procedural Rules.
Stat.—Statutes at Large.
T—Target Corporation.
T.C.—Tax Court.
T.D.—Treasury Decision.
TFE—Transferee.
TFR—Transferor.
T.I.R.—Technical Information Release.
TP—Taxpayer.
TR—Trust.
TT—Trustee.
U.S.C.—United States Code.
X—Corporation.
Y—Corporation.
Z—Corporation.
Bulletin No. 2017–21May 22, 2017
i

Numerical Finding List
1
Bulletin 2017–1 through 2017–21
Action on Decision:
2017-1, 2017-7 I.R.B.868
2017-2, 2017-15 I.R.B.1072
2017-3, 2017-15 I.R.B.1072
2017-4, 2017-15 I.R.B.1073
Announcements:
2017-01, 2017-08 I.R.B.941
2017-02, 2017-10 I.R.B.1007
2017-03, 2017-15 I.R.B.1077
2017-04, 2017-16 I.R.B.1106
Notices:
2017-1, 2017-2 I.R.B.367
2017-2, 2017-4 I.R.B.539
2017-3, 2017-2 I.R.B.368
2017-4, 2017-4 I.R.B.541
2017-5, 2017-6 I.R.B.779
2017-6, 2017-3 I.R.B.422
2017-7, 2017-3 I.R.B.423
2017-8, 2017-3 I.R.B.423
2017-9, 2017-4 I.R.B.542
2017-10, 2017-4 I.R.B.544
2017-12, 2017-5 I.R.B.742
2017-13, 2017-6 I.R.B.780
2017-14, 2017-6 I.R.B.783
2017-15, 2017-6 I.R.B.783
2017-16, 2017-7 I.R.B.913
2017-17, 2017-15 I.R.B.1074
2017-18, 2017-9 I.R.B.997
2017-19, 2017-9 I.R.B.1000
2017-20, 2017-11 I.R.B.1010
2017-21, 2017-13 I.R.B.1026
2017-22, 2017-13 I.R.B.1033
2017-23, 2017-16 I.R.B.1100
2017-24, 2017-17 I.R.B.1127
2017-25, 2017-17 I.R.B.1127
2017-26, 2017-17 I.R.B.1129
2017-27, 2017-19 I.R.B.1232
2017-28, 2017-19 I.R.B.1235
2017-29, 2017-20 I.R.B.1243
2017-30, 2017-21 I.R.B.1248
Proposed Regulations:
REG-137604-07, 2017-7 I.R.B.923
REG-128276-12, 2017-2 I.R.B.369
REG-103477-14, 2017-5 I.R.B.746
REG-112324-15, 2017-4 I.R.B.547
REG-127203-15, 2017-7 I.R.B.918
REG-131643-15, 2017-6 I.R.B.865
REG-134438-15, 2017-2 I.R.B.373
REG-112800-16, 2017-4 I.R.B.569
REG-123829-16, 2017-5 I.R.B.764
Proposed Regulations:—Continued
REG-123841-16, 2017-5 I.R.B.766
REG-133353-16, 2017-2 I.R.B.372
REG-134247-16, 2017-5 I.R.B.744
REG-135122-16, 2017-9 I.R.B.1005
Revenue Procedures:
2017-1, 2017-1 I.R.B.1
2017-2, 2017-1 I.R.B.106
2017-3, 2017-1 I.R.B.130
2017-4, 2017-1 I.R.B.146
2017-5, 2017-1 I.R.B.230
2017-7, 2017-1 I.R.B.269
2017-12, 2017-3 I.R.B.424
2017-13, 2017-6 I.R.B.787
2017-14, 2017-3 I.R.B.426
2017-15, 2017-3 I.R.B.437
2017-16, 2017-3 I.R.B.501
2017-18, 2017-5 I.R.B.743
2017-19, 2017-7 I.R.B.913
2017-21, 2017-6 I.R.B.791
2017-22, 2017-6 I.R.B.863
2017-23, 2017-7 I.R.B.915
2017-24, 2017-7 I.R.B.916
2017-25, 2017-14 I.R.B.1039
2017-26, 2017-13 I.R.B.1036
2017-27, 2017-14 I.R.B.1042
2017-28, 2017-14 I.R.B.1061
2017-29, 2017-14 I.R.B.1065
2017-30, 2017-18 I.R.B.1131
2017-31, 2017-16 I.R.B.1104
2017-32, 2017-17 I.R.B.1109
2017-33, 2017-19 I.R.B.1236
2017-35, 2017-21 I.R.B.1250
2017-36, 2017-21 I.R.B.1251
2017-37, 2017-21 I.R.B.1252
Revenue Rulings:
2017-1, 2017-3 I.R.B.377
2017-2, 2017-2 I.R.B.364
2017-3, 2017-4 I.R.B.522
2017-4, 2017-6 I.R.B.776
2017-5, 2017-9 I.R.B.1000
2017-6, 2017-12 I.R.B.1011
2017-7, 2017-10 I.R.B.1009
2017-8, 2017-14 I.R.B.1037
2017-9, 2017-21 I.R.B.1244
2017-10, 2017-17 I.R.B.1108
2017-11, 2017-19 I.R.B.1230
Treasury Decisions:
9794, 2017-2 I.R.B.273
9795, 2017-2 I.R.B.326
9796, 2017-3 I.R.B.380
9801, 2017-2 I.R.B.355
9802, 2017-2 I.R.B.361
9803, 2017-3 I.R.B.384
Treasury Decisions:—Continued
9804, 2017-3 I.R.B.406
9806, 2017-4 I.R.B.524
9807, 2017-5 I.R.B.573
9808, 2017-5 I.R.B.580
9809, 2017-5 I.R.B.664
9810, 2017-6 I.R.B.775
9811, 2017-7 I.R.B.869
9814, 2017-7 I.R.B.878
9815, 2017-9 I.R.B.944
9817, 2017-9 I.R.B.968
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2016 –27 through 2016 –52 is in Internal Revenue Bulletin
2016 –52, dated December 26, 2016.
May 22, 2017Bulletin No. 2017–21
ii

Finding List of Current Actions on
Previously Published Items
1
Bulletin 2017–1 through 2017–21
Notices:
2002-1
Amplified by
Notice 2017-1, 2017-2 I.R.B.367
2010-46
Obsoleted by
Notice 2017-1, 2017-2 I.R.B.367
2016-29
Modified by
Notice 2017-6, 2017-3 I.R.B.422
Revenue Procedures:
2013-22
Clarified by
Rev. Proc. 2017-18, 2017-05 I.R.B.743
2015-57
Modified by
Rev. Proc. 2017-24, 2017-07 I.R.B.916
Treasury Decisions:
2010-46
Obsoleted by
T.D. 9815 2017-09 I.R.B.944
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2016 –27 through 2016 –52 is in Internal Revenue Bulletin
2016 –52, dated December 26, 2016.
Bulletin No. 2017–21May 22, 2017
iii

INTERNAL REVENUE BULLETIN
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