us-irs-revenue-rulings-irb-2019-51-pdf•Internal Revenue Bulletin 2019-51 (PDF rendition): IRS Revenue Rulings
Internal Revenue Bulletin 2019-51 (PDF rendition): IRS Revenue Rulings
us-irs-revenue-rulings-irb-2019-51-pdfInternal Revenue Bulletin 2019-51 (PDF rendition): IRS Revenue RulingsGuidance
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Bulletin No. 2019–51 December 16, 2019 HIGHLIGHTS OF THIS ISSUE These synopses are intended only as aids to the reader in identifying the subject matter covered. They may not be relied upon as authoritative interpretations. ADMINISTRATIVE Rev. Proc. 2019-48, page 1392. Rev. Proc. 2019-48 modifies Rev. Proc. 2011-47 to reflect certain changes enacted by the TCJA, most notably, the tem- porary suspension of the miscellaneous itemized deduction. Unreimbursed employee travel expenses that are miscella- neous itemized deductions are not permitted during taxable years when the miscellaneous itemized deduction is suspend- ed. Rev. Proc. 2019-48 provides optional rules for deemed substantiation of the amount of certain business expenses of traveling away from home reimbursed to an employee or deductible by certain specified employees or self-employed individuals. INCOME TAX Rev. Rul. 2019-27, page 1378. Section 995 - Taxation of DISC Income to Shareholders 2019 Base Period T-Bill Rate. The “base period T-bill rate” for the period ending September 30, 2019, is published as required by section 995(f) of the Internal Revenue Code. SPECIAL ANNOUNCEMENT Notice 2019-63, page 1390. This notice extends the due dates for certain 2019 infor- mation reporting requirements for insurers, self-insuring em- ployers, and certain other providers of minimum essential coverage under section 6055 and for applicable large em- ployers under section 6056. Specifically, this notice extends the due date for furnishing to individuals the 2019 Form 1095-B, Health Coverage, and the 2019 Form 1095-C, Em- ployer-Provided Health Insurance Offer and Coverage, from January 31, 2020, to March 2, 2020. Additionally, this notice provides that the Service will not impose a penalty under section 6722 against reporting entities for failing to furnish a Form 1095-B to responsible individuals if two conditions are met. This notice also extends transitional good-faith relief from section 6721 and 6722 penalties to the 2019 informa- tion reporting requirements under sections 6055 and 6056. Finding Lists begin on page ii. The IRS Mission Provide America’s taxpayers top-quality service by helping them understand and meet their tax responsibilities and en- force the law with integrity and fairness to all. Introduction The Internal Revenue Bulletin is the authoritative instrument of the Commissioner of Internal Revenue for announcing of- ficial rulings and procedures of the Internal Revenue Service and for publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, and other items of general interest. It is published weekly. It is the policy of the Service to publish in the Bulletin all sub- stantive rulings necessary to promote a uniform application of the tax laws, including all rulings that supersede, revoke, modify, or amend any of those previously published in the Bulletin. All published rulings apply retroactively unless other- wise indicated. Procedures relating solely to matters of inter- nal management are not published; however, statements of internal practices and procedures that affect the rights and duties of taxpayers are published. Revenue rulings represent the conclusions of the Service on the application of the law to the pivotal facts stated in the revenue ruling. In those based on positions taken in rul- ings to taxpayers or technical advice to Service field offices, identifying details and information of a confidential nature are deleted to prevent unwarranted invasions of privacy and to comply with statutory requirements. Rulings and procedures reported in the Bulletin do not have the force and effect of Treasury Department Regulations, but they may be used as precedents. Unpublished rulings will not be relied on, used, or cited as precedents by Service personnel in the disposition of other cases. In applying published rulings and procedures, the effect of subsequent legislation, regulations, court decisions, rulings, and procedures must be considered, and Service personnel and others concerned are cautioned against reaching the same conclusions in other cases unless the facts and circumstances are substantially the same. The Bulletin is divided into four parts as follows: Part I.—1986 Code. This part includes rulings and decisions based on provisions of the Internal Revenue Code of 1986. Part II.—Treaties and Tax Legislation. This part is divided into two subparts as follows: Subpart A, Tax Conventions and Other Related Items, and Subpart B, Legislation and Related Committee Reports. Part III.—Administrative, Procedural, and Miscellaneous. To the extent practicable, pertinent cross references to these subjects are contained in the other Parts and Subparts. Also included in this part are Bank Secrecy Act Administrative Rulings. Bank Secrecy Act Administrative Rulings are issued by the Department of the Treasury’s Office of the Assistant Secretary (Enforcement). Part IV.—Items of General Interest. This part includes notices of proposed rulemakings, disbar- ment and suspension lists, and announcements. The last Bulletin for each month includes a cumulative index for the matters published during the preceding months. These monthly indexes are cumulated on a semiannual basis, and are published in the last Bulletin of each semiannual period. The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate. December 16, 2019 Bulletin No. 2019–51 Part I Section 995.—Taxation of DISC Income to Shareholders 2019 Base Period T-Bill Rate. The “base period T-bill rate” for the period ending September 30, 2019, is published as re- quired by section 995(f) of the Internal Revenue Code. Rev. Rul. 2019-27 Section 995(f)(1) of the Internal Reve- nue Code provides that a shareholder of a domestic international sales corporation (“DISC”) shall pay interest each taxable year in an amount equal to the product of the “shareholder’s DISC-related deferred tax liability” for the year (as defined in section 995(f)(2)) and the “base period T-bill rate.” Under section 995(f)(4), the base period T-bill rate is the annual rate of interest determined by the Secretary to be equivalent to the average of the 1-year constant maturity Treasury yields, as published by the Board of Governors of the Federal Reserve System, for the 1-year period ending on September 30 of the calendar year ending with (or of the most recent calendar year ending before) the close of the taxable year of the share- holder. The base period T-bill rate for the pe- riod ending September 30, 2019, is 2.32 percent. Pursuant to section 6622 of the Inter- nal Revenue Code, interest must be com- pounded daily. The table below provides factors for compounding the 2019 base period T-bill rate daily for any number of days in the shareholder’s taxable year (in- cluding for a 52-53 week accounting peri- od). To compute the amount of the interest charge for the shareholder’s taxable year, multiply the amount of the shareholder’s DISC-related deferred tax liability for that year by the base period T-bill rate factor corresponding to the number of days in the shareholder’s taxable year for which the interest charge is being computed. Generally, one would use the factor for 365 days. One would use a different factor only if the shareholder’s taxable year for which the interest charge is being deter- mined is a short taxable year, if the share- holder uses a 52-53 week taxable year, or if the shareholder’s taxable year is a leap year. For the base period T-bill rates for pe- riods ending in prior years, see Rev. Rul. 2018-31, 2018-50 I.R.B. 848; Rev. Rul. 2017-23, 2017-49 I.R.B. 546; Rev. Rul. 2017-01, 2017-03 I.R.B. 377; Rev. Rul. 2015-26, 2015-49 I.R.B. 696; Rev. Rul. 2014-33, 2014-52 I.R.B. 957; Rev. Rul. 2013-24, 2013-49 I.R.B. 594; Rev. Rul. 2012-22, 2012-48 I.R.B. 565; and Rev. Rul. 2011-30, 2011-49 I.R.B. 826. DRAFTING INFORMATION The principal author of this revenue ruling is Kristina L. Novak of the Office of Associate Chief Counsel (International). For further information regarding the rev- enue ruling, contact Ms. Novak at (202) 317-3800 (not a toll-free number). December 16, 2019 1378 Bulletin No. 2019–51 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 10.000063562 20.000127127 30.000190697 40.000254271 50.000317849 60.000381430 70.000445016 80.000508606 90.000572200 100.000635798 110.000699400 120.000763006 130.000826617 140.000890231 150.000953849 160.001017471 170.001081098 180.001144728 190.001208362 200.001272001 210.001335643 220.001399290 230.001462940 240.001526595 250.001590254 260.001653916 270.001717583 280.001781254 290.001844929 300.001908608 310.001972291 320.002035978 330.002099669 340.002163364 350.002227063 Bulletin No. 2019–51 1379 December 16, 2019 December 16, 2019 1380 Bulletin No. 2019–51 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 360.002290766 370.002354474 380.002418185 390.002481900 400.002545620 410.002609343 420.002673071 430.002736802 440.002800538 450.002864277 460.002928021 470.002991769 480.003055521 490.003119276 500.003183036 510.003246800 520.003310568 530.003374340 540.003438116 550.003501897 560.003565681 570.003629469 580.003693262 590.003757058 600.003820858 610.003884663 620.003948471 630.004012284 640.004076101 650.004139921 660.004203746 670.004267575 680.004331408 690.004395245 700.004459086 Bulletin No. 2019–51 1381 December 16, 2019 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 710.004522931 720.004586780 730.004650633 740.004714491 750.004778352 760.004842217 770.004906087 780.004969960 790.005033838 800.005097719 810.005161605 820.005225495 830.005289388 840.005353286 850.005417188 860.005481094 870.005545004 880.005608918 890.005672836 900.005736759 910.005800685 920.005864615 930.005928550 940.005992488 950.006056431 960.006120377 970.006184328 980.006248283 990.006312242 1000.006376204 1010.006440171 1020.006504142 1030.006568117 1040.006632096 1050.006696080 December 16, 2019 1382 Bulletin No. 2019–51 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 1060.006760067 1070.006824058 1080.006888054 1090.006952053 1100.007016057 1110.007080064 1120.007144076 1130.007208092 1140.007272111 1150.007336135 1160.007400163 1170.007464195 1180.007528231 1190.007592271 1200.007656316 1210.007720364 1220.007784416 1230.007848473 1240.007912533 1250.007976598 1260.008040667 1270.008104739 1280.008168816 1290.008232897 1300.008296982 1310.008361071 1320.008425164 1330.008489261 1340.008553362 1350.008617468 1360.008681577 1370.008745690 1380.008809808 1390.008873930 1400.008938055 Bulletin No. 2019–51 1383 December 16, 2019 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 1410.009002185 1420.009066319 1430.009130457 1440.009194599 1450.009258745 1460.009322895 1470.009387049 1480.009451208 1490.009515370 1500.009579536 1510.009643707 1520.009707882 1530.009772060 1540.009836243 1550.009900430 1560.009964621 1570.010028816 1580.010093015 1590.010157218 1600.010221425 1610.010285637 1620.010349852 1630.010414072 1640.010478295 1650.010542523 1660.010606755 1670.010670990 1680.010735230 1690.010799474 1700.010863722 1710.010927975 1720.010992231 1730.011056491 1740.011120756 1750.011185024 December 16, 2019 1384 Bulletin No. 2019–51 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 1760.011249297 1770.011313573 1780.011377854 1790.011442139 1800.011506428 1810.011570721 1820.011635018 1830.011699319 1840.011763624 1850.011827934 1860.011892247 1870.011956565 1880.012020886 1890.012085212 1900.012149542 1910.012213876 1920.012278214 1930.012342556 1940.012406902 1950.012471252 1960.012535606 1970.012599965 1980.012664327 1990.012728694 2000.012793065 2010.012857440 2020.012921818 2030.012986201 2040.013050588 2050.013114980 2060.013179375 2070.013243774 2080.013308178 2090.013372585 2100.013436997 Bulletin No. 2019–51 1385 December 16, 2019 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 2110.013501413 2120.013565832 2130.013630256 2140.013694684 2150.013759116 2160.013823553 2170.013887993 2180.013952437 2190.014016886 2200.014081338 2210.014145795 2220.014210256 2230.014274721 2240.014339190 2250.014403663 2260.014468140 2270.014532621 2280.014597106 2290.014661596 2300.014726089 2310.014790587 2320.014855089 2330.014919595 2340.014984105 2350.015048619 2360.015113137 2370.015177659 2380.015242186 2390.015306716 2400.015371251 2410.015435789 2420.015500332 2430.015564879 2440.015629430 2450.015693985 December 16, 2019 1386 Bulletin No. 2019–51 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 2460.015758544 2470.015823107 2480.015887675 2490.015952246 2500.016016822 2510.016081402 2520.016145985 2530.016210573 2540.016275165 2550.016339761 2560.016404362 2570.016468966 2580.016533574 2590.016598187 2600.016662804 2610.016727424 2620.016792049 2630.016856678 2640.016921311 2650.016985948 2660.017050590 2670.017115235 2680.017179885 2690.017244538 2700.017309196 2710.017373858 2720.017438524 2730.017503194 2740.017567868 2750.017632546 2760.017697229 2770.017761915 2780.017826606 2790.017891301 2800.017955999 Bulletin No. 2019–51 1387 December 16, 2019 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 2810.018020702 2820.018085410 2830.018150121 2840.018214836 2850.018279555 2860.018344279 2870.018409007 2880.018473738 2890.018538474 2900.018603214 2910.018667958 2920.018732706 2930.018797459 2940.018862215 2950.018926976 2960.018991740 2970.019056509 2980.019121282 2990.019186059 3000.019250840 3010.019315626 3020.019380415 3030.019445208 3040.019510006 3050.019574808 3060.019639614 3070.019704424 3080.019769238 3090.019834056 3100.019898878 3110.019963705 3120.020028535 3130.020093370 3140.020158209 3150.020223052 December 16, 2019 1388 Bulletin No. 2019–51 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 3160.020287899 3170.020352750 3180.020417605 3190.020482465 3200.020547328 3210.020612196 3220.020677068 3230.020741944 3240.020806824 3250.020871708 3260.020936596 3270.021001488 3280.021066385 3290.021131286 3300.021196190 3310.021261099 3320.021326012 3330.021390930 3340.021455851 3350.021520776 3360.021585706 3370.021650639 3380.021715577 3390.021780519 3400.021845465 3410.021910415 3420.021975370 3430.022040328 3440.022105291 3450.022170257 3460.022235228 3470.022300203 3480.022365182 3490.022430165 3500.022495153 Bulletin No. 2019–51 1389 December 16, 2019 ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT DAYSFACTOR 3510.022560144 3520.022625140 3530.022690140 3540.022755143 3550.022820151 3560.022885164 3570.022950180 3580.023015200 3590.023080225 3600.023145253 3610.023210286 3620.023275323 3630.023340364 3640.023405409 3650.023470459 3660.023535512 3670.023600570 3680.023665632 3690.023730697 3700.023795767 3710.023860842 December 16, 2019 1390 Bulletin No. 2019–51 Part III Transition Relief Related to Health Coverage Reporting Required by I.R.C. Sections 6055 and 6056 for 2019 Notice 2019-63 PURPOSE This notice extends the due date for certain 2019 information-reporting re- quirements under sections 6055 and 6056 of the Internal Revenue Code (Code) from January 31, 2020, to March 2, 2020. This notice also provides relief from section 6721 and 6722 penalties for certain as- pects of the 2019 information-reporting requirements under sections 6055 and 6056. BACKGROUND Sections 6055 and 6056 were added to the Code by sections 1502 and 1514 of the Patient Protection and Affordable Care Act (ACA), enacted March 23, 2010, Pub. L. No. 111-148, 124 Stat. 119, 250, 256. Section 6055 requires health insur- ance issuers, self-insuring employers, government agencies, and other providers of minimum essential coverage to file and furnish annual information returns and statements regarding coverage provided. Section 6056 requires applicable large em- ployers (generally those with 50 or more full-time employees, including full-time equivalent employees, in the previous year) to file and furnish annual informa- tion returns and statements relating to the health insurance, if any, that the employer offers to its full-time employees. Section 6056 was amended by sections 10106(g) and 10108(j) of the ACA and was further amended by section 1858(b)(5) of the De- partment of Defense and Full-Year Con- tinuing Appropriations Act, 2011, enacted April 15, 2011, Pub. L. No. 112-10, 125 Stat. 38, 169. Section 36B, which was added to the Code by section 1401 of the ACA, pro- vides a premium tax credit for eligible in- dividuals who enroll in coverage through a Health Insurance Marketplace. Section 5000A, which was added to the Code by section 1501(b) of the ACA, generally provides that individuals must have min- imum essential coverage, qualify for an exemption from the minimum essential coverage requirement, or make an in- dividual shared responsibility payment when they file their federal income tax re- turn. Section 11081 of Pub. L. No. 115-97, 131 Stat. 2054, 2092, enacted December 22, 2017, and commonly referred to as the Tax Cuts and Jobs Act, reduces the indi- vidual shared responsibility payment to zero for months beginning after December 31, 2018. Section 6721 imposes a penalty for failing to timely file an information return or for filing an incorrect or incomplete in- formation return. Section 6722 imposes a penalty for failing to timely furnish an information statement or for furnishing an incorrect or incomplete information state- ment. Section 6721 and 6722 penalties are imposed with regard to information returns and statements listed in section 6724(d), which includes those required by sections 6055 and 6056. The regulations under section 6055 re- quire every person that provides minimum essential coverage to an individual during a calendar year to file with the Internal Revenue Service (Service) an informa- tion return and a transmittal on or before the following February 28 (March 31 if filed electronically) and to furnish to the responsible individual identified on the return a written statement on or before January 31 following the calendar year to which the statement relates. See § 1.6055- 1(f) and (g)(4) of the Income Tax Regu- lations; see also § 6055(c)(2). Except as provided in the following paragraph, the Service has designated Form 1094-B, Transmittal of Health Coverage Informa- tion Returns, and Form 1095-B, Health Coverage, to meet the requirements of the section 6055 regulations. The regulations under section 6056 require every applicable large employer or a member of an aggregated group that is determined to be an applicable large employer (ALE member) to file with the Service an information return and a trans- mittal on or before February 28 (March 31 if filed electronically) of the year follow- ing the calendar year to which it relates and to furnish to full-time employees a written statement on or before January 31 following the calendar year to which the statement relates. See § 301.6056-1(e) and (g) of the Procedure and Administra- tion Regulations; see also § 6056(c)(2). The Service has designated Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Informa- tion Returns, and Form 1095-C, Employ- er-Provided Health Insurance Offer and Coverage, to meet the requirements of the section 6056 regulations. In addition, an ALE member that offers health coverage through a self-insured health plan must complete the reporting required under sec- tion 6055 (that is, information about each individual enrolled in the self-insured health plan) using Form 1095-C, Part III, rather than Form 1095-B. 1 ALE members use Form 1095-C, Part III to meet the sec- tion 6055 reporting requirement for all employees, but for employees who are not full-time, ALE members report only cer- tain information to reflect that the Form 1095-C is being used to complete section 6055 reporting but not section 6056 re- porting, which applies only to full-time employees. The regulations under sections 6055 and 6056 allow the Service to grant an ex- tension of time of up to 30 days to furnish Forms 1095-B and 1095-C for good cause shown. See §§ 1.6055-1(g)(4)(i)(B)(1) and 301.6056-1(g)(1)(ii)(A). In addition, filers of Forms 1095-B, 1094-C, and 1095-C may receive an automatic 30-day exten- sion of time to file these forms with the Service by submitting Form 8809, Appli- 1 See the Instructions for Forms 1094-C and 1095-C for the option to file Form 1094-B and Form 1095-B, rather than Form 1094-C and Form 1095-C, to report coverage of certain non-em- ployees. Bulletin No. 2019–51 1391 December 16, 2019 cation for Extension of Time To File Infor- mation Returns, on or before the due date for filing those forms. See §§ 1.6081-1 and 1.6081-8. In limited situations, filers who submit Form 8809 before the automatic 30-day extension period expires may also receive an additional 30-day extension of time to file Forms 1095-B, 1094-C, and 1095-C with the Service. See id. The preambles to the section 6055 and 6056 regulations (T.D. 9660, 79 FR 13220, 2014-13 I.R.B. 842; T.D. 9661, 79 FR 13231, 2014-13 I.R.B. 855) provided that, for reporting of 2015 offers and cov- erage, the Service would not impose pen- alties under sections 6721 and 6722 on re- porting entities that could show that they made good-faith efforts to comply with the information-reporting requirements. This relief applied only to furnishing and filing incorrect or incomplete information reported on a statement or return and not to a failure to timely furnish or file a state- ment or return. Notice 2015-87, 2015-52 I.R.B. 889, reiterated that relief, and No- tice 2015-68, 2015-41 I.R.B. 547, provid- ed additional information about that relief with regard to reporting under section 6055. The preambles also noted the gen- eral rule that, under section 6724 and the related regulations, the section 6721 and 6722 penalties may be waived if a failure to timely furnish or file a statement or re- turn is due to reasonable cause. Through a series of Internal Revenue Bulletin notices, the Service extended the due dates for information-reporting requirements under sections 6055 and 6056 for furnishing statements to individ- uals for the years 2015, 2016, 2017, and 2018. See Notice 2016-4, 2016-3 I.R.B. 279 (2015); Notice 2016-70, 2016-49 I.R.B. 784 (2016); Notice 2018-06, 2018- 2 I.R.B. 300 (2017); Notice 2018-94, 2018-51 I.R.B.1042 (2018). In these no- tices, in general, 2 the Service extended the furnishing due date for the Forms 1095-B and 1095-C by 30 days. Each notice also extended the good-faith transition relief from section 6721 and 6722 penalties to the information-reporting requirements under sections 6055 and 6056 for the years 2015, 2016, 2017, and 2018, respectively. TRANSITION RELIEF A. Extension of Due Date for Furnishing Information Statements to Individuals under Sections 6055 and 6056 for 2019 The Department of the Treasury (Trea- sury Department) and the Service have determined that a substantial number of employers, insurers, and other providers of minimum essential coverage need addi- tional time beyond the January 31, 2020, due date to gather and analyze the infor- mation and prepare the 2019 Forms 1095- B and 1095-C to be furnished to individ- uals. Accordingly, this notice extends the due date for furnishing the 2019 Forms 1095-B and 1095-C, from January 31, 2020, to March 2, 2020. 3 In view of this automatic extension to March 2, 2020, the provisions under §§ 1.6055-1(g)(4)(i)(B) (1) and 301.6056-1(g)(1)(ii)(A) allowing the Service to grant an extension of time of up to 30 days to furnish Forms 1095-B and 1095-C will not apply to the extended due date. Because the extension of the due date to furnish information statements to individuals granted in this notice applies automatically and is as generous as the permissive 30-day extension of time to furnish 2019 information statements un- der sections 6055 and 6056 that may be requested by some reporting entities in submissions to the Service, the Service will not formally respond to such requests. Notwithstanding the extension provided in this notice, employers and other cov- erage providers are encouraged to furnish 2019 statements as soon as they are able. This notice does not extend the due date for filing with the Service the 2019 Forms 1094-B, 1095-B, 1094-C, or 1095- C. However, this notice does not affect the provisions regarding an automatic extension of time for filing information returns; the automatic extension remains available under the normal rules for em- ployers and other coverage providers who submit a Form 8809 on or before the due date. See §§ 1.6081-1 and 1.6081-8. This notice also does not affect the provisions regarding additional extensions of time to file. See id. B. Relief Regarding the Furnishing Requirement under Section 6055 for 2019 In Notice 2018-94, the Treasury De- partment and the Service stated that, be- cause the individual shared responsibility payment is reduced to zero for months beginning after December 31, 2018, they were studying whether and how the re- porting requirements under section 6055 should change, if at all, for future years. The Treasury Department and the Service continue to do so and to request com- ments. Because the individual shared re- sponsibility payment is reduced to zero in 2019, an individual does not need the information on Form 1095-B in order to compute his or her federal tax liability or file an income tax return with the Service. Nonetheless, reporting entities required to furnish Form 1095-B to individuals must expend resources to do so. At this time, the Treasury Department and the Service have determined as a matter of enforce- ment priorities that, for 2019, relief from the penalty under section 6722 for failing to furnish a statement as required under section 6055 is in the interest of sound tax administration in certain cases. In partic- ular, the Service will not assess a penalty under section 6722 against reporting enti- ties for failing to furnish a Form 1095-B to responsible individuals in cases where the following two conditions are met (the 2019 section 6055 furnishing relief). First, the reporting entity posts a notice promi- nently on its website stating that responsi- ble individuals may receive a copy of their 2019 Form 1095-B upon request, accom- panied by an email address and a physical address to which a request may be sent, as well as a telephone number that respon- sible individuals can use to contact the reporting entity with any questions. Sec- ond, the reporting entity furnishes a 2019 Form 1095-B to any responsible individu- al upon request within 30 days of the date the request is received. As noted earlier in this notice, ALE members that offer self-insured health plans are generally required to use Form 1095-C, Part III to meet the section 6055 reporting requirements, instead of Form 2 For 2015, the furnishing due date was extended by 60 days and, for 2018, the furnishing due date was extended by 32 days because the 30th day fell on a Saturday. 3 This Notice extends the due date for furnishing 2019 Forms 1095-B and 1095-C to March 2 to provide a full 30-day extension. This due date takes into account that 2020 is a leap year and that March 1, 2020 is a Sunday. December 16, 2019 1392 Bulletin No. 2019–51 1095-B. However, because of the com- bined reporting under sections 6056 and 6055 on the Form 1095-C for full-time employees of ALE members enrolled in self-insured health plans, the 2019 section 6055 furnishing relief does not extend to the requirement to furnish Forms 1095-C to full-time employees. Accordingly, for full-time employees enrolled in self-in- sured health plans, penalties will contin- ue to be assessed consistent with prior enforcement policies for any failure by ALE members to furnish Form 1095-C, including Part III, according to the ap- plicable instructions. However, the 2019 section 6055 furnishing relief does extend to penalty assessments in connection with the requirement to furnish the Form 1095- C to any employee enrolled in an ALE member’s self-insured health plan who is not a full-time employee for any month of 2019, 4 subject to the requirements of the 2019 section 6055 furnishing relief. The 2019 section 6055 furnishing re- lief does not affect assessment of penal- ties associated with the requirement or the deadline to file with the Service the 2019 Forms 1094-B or 1095-B or the Forms 1094-C or 1095-C, as applicable. C. Extension of Good-Faith Relief for Reporting and Furnishing under Sections 6055 and 6056 for 2019 This notice also extends relief from penalties under sections 6721 and 6722 to reporting entities that report incorrect or incomplete information on the re- turn or statement when these entities can show that they made good-faith efforts to comply with the information-report- ing requirements under sections 6055 and 6056 for 2019 (both for furnishing to in- dividuals and for filing with the Service). This relief applies to missing and inaccu- rate taxpayer identification numbers and dates of birth, as well as other informa- tion required on the return or statement. Reporting entities must make a good-faith effort to comply with the regulations un- der sections 6055 and 6056 to be eligible for this relief. In determining good faith, the Service will take into account wheth- er an employer or other coverage provid- er made reasonable efforts to prepare for reporting the required information to the Service and furnishing it to employees and covered individuals, such as gathering and transmitting the necessary data to an agent to prepare the data for submission to the Service or testing its ability to transmit information to the Service. Reporting en- tities that fail to file an information return or furnish a statement by the extended due dates, except as otherwise provided in this notice, are not eligible for relief. D. Future Years and Request for Comments The Treasury Department and the Ser- vice request comments as to whether an extension of the due date for furnishing statements to individuals under section 6056, and an extension of good-faith re- porting relief under section 6056, will be necessary for future years and, if so, why. Taxpayers and reporting entities may submit comments electronically via the Federal eRulemaking Portal at www. regulations.gov (type “IRS-2019-XX” in the search field on the regulations.gov homepage to find this notice and submit comments). Alternatively, taxpayers and reporting entities may mail comments to: Internal Revenue Service Attn: CC:PA:LPD:PR (Notice 2019- XX) Room 5203 P.O. Box 7604 Ben Franklin Station Washington, D.C. 20044 All comments received will be avail- able for public inspection on www.regu- lations.gov. CONTACT INFORMATION The principal author of this notice is Danielle Pierce of the Office of the As- sociate Chief Counsel (Procedure and Administration). For further information regarding this notice contact Danielle Pierce at (202) 317-6845 (not a toll-free number). 26 CFR 601.105: Examination of returns and claims for refund, credit, or abatement; determination of correct tax liability. (Also: Part I, §§ 62, 67, 162, 267, 274; 1.62-2, 1.162-17, 1.267(a)-1, 1.274-5, 1.274-5T.) Rev. Proc. 2019-48 SECTION 1. PURPOSE Section 11045 of Pub. L. No. 115-97, 131 Stat. 2054, 2088 (2017), common- ly referred to as the Tax Cuts and Jobs Act (TCJA), amended § 67 of the Inter- nal Revenue Code (Code) to suspend all miscellaneous itemized deductions for taxable years beginning after December 31, 2017, and before January 1, 2026. In addition, § 13304 of the TCJA amended § 274 of the Code to generally disallow a deduction for expenses with respect to entertainment, amusement, or recreation for amounts incurred or paid after De- cember 31, 2017. This revenue procedure modifies Rev. Proc. 2011-47, 2011-42 I.R.B. 520, to incorporate the changes made by the TCJA, and provides rules for using a per diem rate to substantiate, un- der § 274(d) and § 1.274-5 of the Income Tax Regulations, the amount of ordinary and necessary business expenses paid or incurred while traveling away from home. Taxpayers are not required to use a method described in this revenue proce- dure. A taxpayer may substantiate actual allowable expenses if the taxpayer main- tains adequate records or other sufficient evidence. This revenue procedure provides rules for using a per diem rate to substantiate the amount of an employee’s expenses for lodging, meal, and incidental expenses, or for meal and incidental expenses only, that a payor (an employer, its agent, or a third party) reimburses. Certain specified employees and self-employed individu- als that deduct unreimbursed expenses for travel away from home may use a per diem rate for meals and incidental expens- es, or incidental expenses only, under this revenue procedure. This revenue proce- dure does not provide rules for using a per 4 For such an employee, the Instructions for Forms 1094-C and 1095-C provide that the employer is to enter code 1G on line 14 for the Form 1095-C, but the ALE member is not otherwise required to complete Part II of Form 1095-C. Bulletin No. 2019–51 1393 December 16, 2019 diem rate to substantiate the amount of lodging expenses only. The Internal Revenue Service (Service) publishes an annual notice that provides the special per diem rates for purposes of sections 4.04, 4.05, and 5 of this revenue procedure and the list of high-cost locali- ties for purposes of section 5 of this rev- enue procedure. See, for example, Notice 2019-55, 2019-42 I.R.B. 937 (or succes- sor). The annual notice provides (1) the special transportation industry meal and incidental expenses rates (M&IE rates), (2) the rate for the incidental expenses only deduction, and (3) the rates and list of high-cost localities for purposes of the high-low substantiation method. SECTION 2. BACKGROUND AND CHANGES .01 Section 162(a) of the Code allows a deduction for ordinary and necessary ex- penses paid or incurred during the taxable year in carrying on any trade or business, including expenses for travel away from home. Under § 262 of the Code, a taxpay- er may not deduct personal travel or living expenses. .02 Section 274(n) generally limits the amount allowable as a deduction under § 162 for any expense for food or bever- ages to 50 percent of the otherwise allow- able amount. For an individual during, or incident to, a period of duty subject to the hours of service limitations of the Depart- ment of Transportation, § 274(n)(3) pro- vides that, for taxable years beginning in 2008 or thereafter, the deductible percent- age for these expenses is 80 percent. .03 To deduct expenses for travel away from home, a taxpayer must substantiate the expenses under § 274(d), which also authorizes the Secretary of the Treasury or his delegate to prescribe by regulation that some or all of the substantiation require- ments do not apply to an expense that does not exceed a particular amount. .04 Section 1.274-5(g) authorizes the Commissioner of Internal Revenue (Com- missioner) to prescribe rules under which reimbursement arrangements or per diem allowances are regarded (1) as equivalent to substantiation, by adequate records or other sufficient evidence, of the amount of travel expenses for purposes of § 1.274- 5(c), and (2) as satisfying the requirements of an adequate accounting to the employer of the amount of travel expenses for pur- poses of § 1.274-5(f). .05 For purposes of determining ad- justed gross income, § 62(a)(2)(A) of the Code allows an employee to deduct busi- ness expenses the employee pays or incurs in performing services under a reimburse- ment or other expense allowance arrange- ment with a payor. In addition, § 62(a)(2) (B)-(E) allow qualified performing artists, fee-basis state or local government offi- cials, eligible educators, and Armed Forc- es reservists to deduct specified business expenses paid or incurred in performing services. The expenses paid or incurred by employees that are deductible under § 62(a)(2) in computing adjusted gross income are above-the-line deductions de- termined without regard to § 67. .06 Section 62(c) provides that an ar- rangement is not treated as a reimburse- ment or other expense allowance ar- rangement for purposes of § 62(a)(2)(A) if it (1) does not require the employee to substantiate the expenses covered by the arrangement to the payor, or (2) allows the employee to retain any amount in excess of the substantiated expenses covered un- der the arrangement. Section 62(c) further provides, however, that substantiation is not required for the expense to the extent provided in regulations under § 274(d). .07 Under § 1.62-2(c) of the Income Tax Regulations, a reimbursement or oth- er expense allowance arrangement satis- fies the requirements of § 62(c) if it meets the requirements of business connection, substantiation, and returning amounts in excess of expenses. In that case, all amounts paid under the arrangement are treated as paid under an accountable plan and are excluded from income and wages. If an arrangement does not meet one or more of these requirements, all amounts paid under the arrangement are treated as paid under a nonaccountable plan and are included in an employee’s gross income, must be reported as wages or compensa- tion on the employee’s Form W-2, and are subject to the withholding and payment of employment taxes (Federal Insurance Contributions Act, Federal Unemploy- ment Tax Act, Railroad Retirement Tax Act, Railroad Unemployment Repayment Tax, and income tax under subtitle A of the Code). .08 Section 1.62-2(e)(2) provides that the amount of a business expense substan- tiated under § 1.274-5(g) is treated as sub- stantiated for purposes of § 1.62-2. .09 Under § 1.62-2(f)(2), the Commis- sioner may prescribe rules for treating an arrangement providing per diem allow- ances as satisfying the requirement of re- turning amounts in excess of expenses if the arrangement requires the employee to return amounts that relate to unsubstanti- ated travel days, even though the arrange- ment does not require the employee to return the portion of the allowance that re- lates to substantiated travel days and that exceeds the deemed substantiated amount for those days. The allowance must be reasonably calculated not to exceed the amount of the employee’s expenses or anticipated expenses and the employee must be required to return within a rea- sonable period of time any portion of the allowance that relates to unsubstantiated travel days. Under § 1.62-2(h)(2)(i)(B), the portion of the allowance that relates to substantiated travel days, that exceeds the substantiated amount for those days, and that the employee is not required to return is subject to withholding and payment of employment taxes. See §§ 31.3121(a)- 3, 31.3231(e)-1(a)(5), 31.3306(b)-2, and 31.3401(a)-4 of the Employment Tax Regulations. .10 Under § 1.62-2(h)(2)(i)(B)(4), the Commissioner may prescribe special rules for the timing of withholding and paying employment taxes on per diem allowanc- es. .11 Section 1.274-5(j)(1) authorizes the Commissioner to establish a meth- od allowing a taxpayer to treat a specif- ic amount as paid or incurred for meals while traveling away from home instead of substantiating the actual cost. .12 Section 1.274-5(j)(3) authorizes the Commissioner to establish a meth- od allowing a taxpayer to treat a specific amount as paid or incurred for incidental expenses while traveling away from home in lieu of substantiating the actual cost. .13 Section 67(a) provides generally that, in the case of an individual, the mis- cellaneous itemized deductions for any taxable year shall be allowed only to the extent that the aggregate of such deduc- tions exceeds 2 percent of adjusted gross income. December 16, 2019 1394 Bulletin No. 2019–51 .14 Section 11045 of the TCJA amend- ed § 67 to temporarily suspend all miscel- laneous itemized deductions that are sub- ject to the two-percent of adjusted gross income floor. For any taxable year begin- ning after December 31, 2017, and before January 1, 2026 (suspension period), a taxpayer is not permitted to claim miscel- laneous itemized deductions, including unreimbursed employee travel expenses. .15 Section 13304 of the TCJA amend- ed § 274 to generally disallow a deduction for expenses with respect to entertain- ment, amusement, or recreation incurred or paid after December 31, 2017. Other- wise allowable meal expenses remain de- ductible, subject to the 50 percent limita- tion in § 274(n)(1). .16 This revenue procedure includes modifications to Rev. Proc. 2011-47 as follows: (1) The definition of “incidental ex- penses” in section 3.02 is updated to re- flect the definition of this term in the cur- rent Federal Travel Regulations, 41 C.F.R. 300-3.1. (2) Sections 7.05, 7.06, and 7.07 are deleted to reflect changes made by the TCJA: (a) unreimbursed employee travel expenses that are miscellaneous itemized deductions subject to the two-percent of adjusted gross income floor are not per- mitted during the suspension period, and (b) a deduction for expenses with respect to entertainment, amusement, or recre- ation is generally disallowed. New sec- tions 7.05, 7.06 and 7.07 are added to clar- ify that employees described in § 62(a)(2) (B)-(E), may continue to use the methods allowed under sections 4.03 and 4.05 of this revenue procedure to substantiate their expenses. SECTION 3. DEFINITIONS .01 Per diem allowance. The term “per diem allowance” means a payment under a reimbursement or other expense allow- ance arrangement that is -- (1) Paid for ordinary and necessary business expenses incurred, or that the payor reasonably anticipates will be in- curred, by an employee for lodging, meal, and incidental expenses, or for meal and incidental expenses, for travel away from home performing services as an employee of the employer, (2) Reasonably calculated not to ex- ceed the amount of the expenses or the anticipated expenses, and (3) Paid at or below the applicable federal per diem rate, a flat rate or stated schedule, or in accordance with any other Service-specified rate or schedule. .02 Federal per diem rate and federal M&IE rate. (1) In general. The federal per diem rate is equal to the sum of the applicable federal lodging expense rate and the appli- cable federal M&IE rate for the day and locality of travel. (a) CONUS rates. The General Ser- vices Administration (GSA) publishes the rates for localities in the continental Unit- ed States (CONUS), as noted in Appendix A to 41 C.F.R. ch. 301. The GSA rates are available on the internet at www.gsa.gov. (b) OCONUS rates. The rates for local- ities outside the continental United States (OCONUS) are established by the Secre- tary of Defense (rates for non-foreign lo- calities, including Alaska, Hawaii, Puerto Rico, the Northern Mariana Islands, and the possessions of the United States) and by the Secretary of State (rates for foreign localities). These rates are published in the Per Diem Supplement to the Standardized Regulations (Government Civilians, For- eign Areas) (updated on a monthly basis) and are available on the internet at www. defensetravel.dod.mil and www.state.gov. (2) Locality of travel. The term “lo- cality of travel” means the locality where an employee or self-employed individual traveling away from home stops for sleep or rest. (3) Incidental expenses. The term “in- cidental expenses” has the same meaning as in the Federal Travel Regulations, 41 C.F.R. 300-3.1 (fees and tips given to porters, baggage carriers, bellhops, hotel staff, and staff on ships). Future changes to the definition of incidental expenses in the Federal Travel Regulations will be announced in the annual notice providing the special per diem rates. .03 Flat rate or stated schedule. (1) In general. Except as provided in section 3.03(2) of this revenue procedure, an allowance is paid at a flat rate or stated schedule if it is provided on a uniform and objective basis for the expenses described in section 3.01(1) of this revenue proce- dure. The allowance may be paid for the number of days away from home perform- ing services as an employee or on any oth- er basis that is consistently applied and in accordance with reasonable business prac- tice. Thus, for example, an hourly pay- ment to cover meal and incidental expens- es paid to a pilot or flight attendant who is traveling away from home performing services as an employee is an allowance paid at a flat rate or stated schedule. Like- wise, a payment based on the number of miles traveled (such as cents per mile) to cover meal and incidental expenses paid to an over-the-road truck driver who is traveling away from home performing services as an employee is an allowance paid at a flat rate or stated schedule. (2) Limitation. An allowance that is computed on a basis similar to that used in computing an employee’s wages or other compensation (such as the number of hours worked, miles traveled, or piec- es produced) does not meet the business connection requirement of § 1.62-2(d), is not a per diem allowance, and is not paid at a flat rate or stated schedule, unless, as of December 12, 1989, (a) the allowance was identified by the payor either by mak- ing a separate payment or by specifically identifying the amount of the allowance, or (b) an allowance computed on that ba- sis was commonly used in the industry in which the employee performed services. See § 1.62-2(d)(3)(ii). .04 Partners and volunteers. Individ- uals subject to the rules of Subchapter K of chapter 1 of subtitle A of the Code (partners) and individuals performing ser- vices without remuneration (volunteers) who receive reimbursements from payors may use the methods allowed under this revenue procedure to substantiate their expenses. The rules of sections 3, 4, 5, and 6 (except section 6.06) of this revenue procedure apply to reimbursements from payors to partners or volunteers. SECTION 4. PER DIEM SUBSTANTIATION METHOD .01 Per diem allowance. If a payor pays a per diem allowance in lieu of reim- bursing actual lodging, meal, and inciden- tal expenses incurred or reasonably antic- ipated to be incurred by an employee for travel away from home, the amount of the expenses that is deemed substantiated for Bulletin No. 2019–51 1395 December 16, 2019 each calendar day is equal to the lesser of the per diem allowance for that day or the amount computed at the federal per diem rate (see section 3.02 of this revenue pro- cedure) for the locality of travel for that day (or partial day, see section 6.04 of this revenue procedure). See section 4.06(1) of this revenue procedure for transition rules. .02 Meal and incidental expenses only per diem allowance. If a payor pays a per diem allowance only for meal and inci- dental expenses in lieu of reimbursing actual meal and incidental expenses in- curred or to be incurred by an employee for travel away from home, the amount of the expenses that is deemed substantiated for each calendar day is equal to the lesser of the per diem allowance for that day or the amount computed at the federal M&IE rate for the locality of travel for that day or partial day. A per diem allowance is treat- ed as paid for meal and incidental expens- es only if (1) the payor pays the employee for actual expenses for lodging based on receipts submitted to the payor, (2) the payor provides the lodging in kind, (3) the payor pays the actual expenses for lodg- ing directly to the provider of the lodging, (4) the payor does not have a reasonable belief that the employee will or did incur lodging expenses, or (5) the allowance is computed on a basis similar to that used in computing an employee’s wages or oth- er compensation (such as the number of hours worked, miles traveled, or pieces produced). See section 4.06(1) of this rev- enue procedure for transition rules. .03 Method for meal and incidental expenses only deduction. Instead of the actual expense amount, employees de- scribed in § 62(a)(2)(B)-(E), and self-em- ployed individuals may substantiate the amount of deductible meal expenses by using an amount computed at the fed- eral M&IE rate for the locality of travel for each calendar day or partial day the employee or self-employed individual is traveling away from home. This amount is deemed substantiated for purposes of § 1.274-5T(b)(2)(i) and (c), provided the employee or self-employed individual substantiates the elements of time, place, and business purpose of the travel for that day or partial day in accordance with those regulations. See section 6.05(1) of this revenue procedure for rules related to the application of the § 274(n) limitation to amounts determined under this section 4.03. See section 4.05 of this revenue pro- cedure for a method for substantiating the deductible amount of incidental expenses that employees described in § 62(a)(2) (B)-(E), or self-employed individuals who do not pay or incur meal expenses may use. See section 4.06(1) of this revenue procedure for transition rules. .04 Special rules for the transportation industry. (1) In general. This section 4.04 ap- plies to (a) a payor that pays a per diem allowance only for meal and incidental expenses for travel away from home to an employee in the transportation indus- try and computes the amount under sec- tion 4.02 of this revenue procedure, or (b) self-employed individuals in the transpor- tation industry who compute the deduct- ible amount for meal and incidental ex- penses for travel away from home under section 4.03 of this revenue procedure. (2) Transportation industry defined. For purposes of this section 4.04, an employee or self-employed individual is in the trans- portation industry only if the employee’s or self-employed individual’s work (a) is of the type that directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and (b) involves regu- larly traveling away from home and stop- ping during a single trip at localities with differing federal M&IE rates. For purpos- es of the preceding sentence, a payor must determine that an employee or a group of employees is in the transportation indus- try by using a method that is consistently applied and in accordance with reasonable business practice. (3) Rates. A taxpayer described in sec- tion 4.04(1) of this revenue procedure may use the CONUS and OCONUS special M&IE rates (published in an annual no- tice) for the transportation industry. A pay- or that uses either or both of these special rates for an employee must use the special rate(s) for all amounts deemed substan- tiated under section 4.02 of this revenue procedure paid to that employee for trav- el away from home within CONUS and/ or OCONUS during the calendar year. Similarly, a self-employed individual who uses either or both of these special rates must use the special rate(s) for all amounts deemed substantiated under section 4.03 of this revenue procedure for travel away from home within CONUS and/or OCO- NUS during the calendar year. See section 4.06(2) of this revenue procedure for tran- sition rules. (4) Periodic rule. A payor described in section 4.04(1) of this revenue procedure may compute the amount of an employ- ee’s expenses that is deemed substantiated under section 4.02 of this revenue proce- dure periodically (not less frequently than monthly) rather than daily by comparing the total per diem allowance paid for the period to the sum of the amounts comput- ed either at the federal M&IE rate(s) for the localities of travel, or at the special rate described in section 4.04(3) of this revenue procedure, for the days or partial days the employee is away from home during the period. (5) Examples. (a) Example 1. Taxpayer, an employee in the transportation industry, travels away from home on business within CONUS for 10 days during a calendar month. A payor pays Taxpayer a per diem allowance for meal and incidental expenses only that the payor computes using section 4.04(3) of this revenue procedure. The CONUS spe- cial M&IE rate is $59 per day. The amount deemed substantiated under section 4.02 of this revenue procedure is equal to the lesser of the total per diem allowance paid for the month ($590) or $590 (10 days away from home paid using the special transportation federal M&IE rate at $59 per day). In this example, the total per diem allowance paid for the month and the special transportation industry federal M&IE rate are the same amount. (b) Example 2. Taxpayer, a truck driver employee in the transportation industry, is paid a “cents-per-mile” allowance that qualifies as an allowance paid under a flat rate or stated schedule as defined in sec- tion 3.03 of this revenue procedure. Tax- payer travels away from home on business for 10 days. Based on the number of miles Taxpayer is expected to drive per day, Taxpayer’s employer pays an allowance of $500 for the 10 days of business travel. The CONUS special M&IE rate is $59 per day. Taxpayer actually drives for 8 days, and does not drive for the other 2 days Taxpayer is away from home. Taxpayer is paid under the periodic rule used for trans- portation industry employers and employ- ees in accordance with section 4.04(4) December 16, 2019 1396 Bulletin No. 2019–51 of this revenue procedure. The amount deemed substantiated is the full $500 be- cause that amount does not exceed $590 (10 days away from home at $59 per day). .05 Method for incidental expenses only deduction. Instead of using actual expenses in computing the amount al- lowable as a deduction for ordinary and necessary incidental expenses paid or incurred for travel away from home, em- ployees described in § 62(a)(2)(B)-(E), and self-employed individuals who pay or incur incidental expenses but do not pay or incur meal expenses for a calendar day or partial day of travel away from home may use, for each calendar day or partial day the employee described in this sec- tion 4.05 or self-employed individual is away from home, an amount that the Ser- vice publishes in an annual notice. This amount is deemed substantiated for pur- poses of § 1.274-5T(b)(2)(i) and (c), pro- vided the employee or self-employed indi- vidual substantiates the elements of time, place, and business purpose of the travel for that day or partial day in accordance with those regulations. The method autho- rized by this section 4.05 may not be used by payors that reimburse expenses under section 4.01, 4.02, or 5.01 of this revenue procedure, or by employees described in § 62(a)(2)(B)-(E) or self-employed in- dividuals who use the method described in section 4.03 of this revenue procedure to substantiate the amount of deductible meal and incidental expenses. See section 6.05(5) of this revenue procedure for rules related to the application of the § 274(n) limitation to amounts determined under this section 4.05. .06 Transition rules. (1) In general. In applying section 4.01, 4.02, or 4.03 of this revenue pro- cedure, taxpayers may continue to use the CONUS rates in effect for the first 9 months of the calendar year, instead of the updated GSA rates, for expenses of all CONUS travel away from home that are paid or incurred during the last 3 months of the calendar year. A taxpayer must use either the rates for the first 9 months of the calendar year or the updated rates for the period October 1 through December 31 of each calendar year consistently. (2) Special transportation industry rates. Under the calendar-year convention provided in section 4.04(3) of this revenue procedure, a taxpayer who uses the feder- al M&IE rates during the first 9 months of the calendar year to substantiate the amount of an individual’s travel expenses under sections 4.02 or 4.03 of this revenue procedure may not use, for that individu- al, the special transportation industry rates published in an annual notice until Janu- ary 1 of the next calendar year. Similar- ly, a taxpayer who uses the special trans- portation industry rates during the first 9 months of the calendar year to substan- tiate the amount of an individual’s travel expenses may not use, for that individual, the federal M&IE rates until January 1 of the next calendar year. SECTION 5. HIGH-LOW SUBSTANTIATION METHOD .01 In general. A payor that pays a per diem allowance in lieu of reimbursing ac- tual expenses an employee pays or incurs or will pay or incur for travel away from home may use the high-low substantia- tion method described in this section 5 in lieu of the per diem substantiation method described in section 4.01 of this revenue procedure or the meal and incidental ex- penses only method described in section 4.02 of this revenue procedure. If a payor uses the high-low substantiation method, the amount of the expenses that is deemed substantiated for each calendar day is equal to the lesser of the actual per diem allowance for that day or the amount com- puted under section 5.02 of this revenue procedure. Employees and self-employed individuals may not use the high-low sub- stantiation method in lieu of the meal and incidental expenses only deduction meth- od described in section 4.03 of this reve- nue procedure. .02 Application of high-low method. Under the high-low substantiation meth- od, a high rate applies to localities des- ignated as high-cost localities and a low rate applies to every other locality within CONUS (one high rate and one low rate for lodging, meal, and incidental expens- es and one high rate and one low rate for meal and incidental expenses only). The high or low rates, as appropriate, apply as if they were the federal per diem rate or the federal M&IE rate for the locality of travel. The high and low rates, amounts treated as meal expenses for purposes of § 274(n), and a list of high-cost localities are published in an annual notice. .03 Limitation. A payor that uses the high-low substantiation method for an employee must use that method for all amounts paid to that employee for travel away from home within CONUS during the calendar year. The payor may use any permissible method (actual expenses, the per diem substantiation method described in section 4.01 of this revenue procedure, or the meal and incidental expenses only per diem substantiation method described in section 4.02 of this revenue procedure) to reimburse that employee for any OCO- NUS travel away from home. .04 Transition rules. For travel in the last 3 months of a calendar year-- (1) A payor must continue to use the same method (per diem method under sections 4.01 or 4.02 of this revenue pro- cedure, or high-low method) for an em- ployee as the payor used during the first 9 months of the calendar year; and (2) A payor may use either the rates and high-cost localities in effect for the first 9 months of the calendar year or the updated rates and high-cost localities in effect for the last 3 months of the calendar year if the payor uses the same rates and local- ities consistently for all employees reim- bursed under the high-low method. .05 Examples. (1) Example 1. Employer pays a per diem allowance for lodging, meal, and incidental expenses to Employee for trav- el away from home using the high-low substantiation method. Employee travels away from home for 5 full days to City A within CONUS. City A is listed as a high-cost locality. Employer reimburses employee at a rate of $225 per day for each of employee’s 5 days of travel. The per diem rate for a high-cost locality is $250. The amount deemed substantiated under section 5 of this revenue procedure is $225 per day (the lesser of the per diem allowance for each day ($225) or the per diem rate for a high-cost locality ($250)). (2) Example 2. Employer pays a per diem allowance for meal and inciden- tal expenses only to Employee for trav- el away from home using the high-low substantiation method. Employee travels away from home to City B (within CO- NUS) each month of Year 1. For all of Year 1, Employer reimburses Employee at Bulletin No. 2019–51 1397 December 16, 2019 a rate of $50 per day for meal and inciden- tal expenses only. For the first 9 months of Year 1, City B is listed as a high-cost locality. The M&IE rate is $60 for a high- cost locality and $45 for all other locali- ties. For the last 3 months of Year 1, City B is not listed as a high-cost locality, and the M&IE rate for City B is $48. Employ- er chooses to use the rates and list of high- cost localities in effect during the first 9 months of Year 1 for the last 3 months of Year 1 (instead of the updated rates for the last 3 months of Year 1). If Employer uses the rates and high-cost localities in effect during the first 9 months of Year 1 for the last 3 months of Year 1 consistently for all employees, the amount deemed sub- stantiated for Employee’s travel to City B during the last 3 months of Year 1 is $50, the lesser of the M&IE rate for a high-cost locality ($60) or the employee’s per diem allowance for each day ($50). SECTION 6. LIMITATIONS AND SPECIAL RULES .01 In general. The federal per diem rate and the federal M&IE rate described in section 3.02 of this revenue procedure for the locality of travel apply in the same manner as they apply under the Feder- al Travel Regulations, 41 C.F.R. Part 301, except as provided in sections 6.02 through 6.04 of this revenue procedure. .02 Federal per diem rate. A receipt for lodging expenses is not required in deter- mining the amount of expenses deemed substantiated at the federal per diem rate (including lodging, meal, and incidental expenses in one rate) under section 4.01 or 5.01. See section 7.01 of this revenue procedure for the requirement that an em- ployee substantiate the time, place, and business purpose of the expense. .03 Meals provided in kind. A payor is not required to reduce the federal per diem rate or the federal M&IE rate for the lo- cality of travel for meals provided in kind, provided the payor has a reasonable belief that the employee incurred or will incur meal and incidental expenses during each day of travel. .04 Proration of the federal per diem or M&IE rate. Under the Federal Travel Regulations, in determining the federal per diem rate or the federal M&IE rate for the locality of travel, the full applicable federal M&IE rate is available for a full day of travel from 12:01 a.m. to 12:00 midnight. A taxpayer must use the method described in section 6.04(1) of this reve- nue procedure for purposes of determin- ing the amount deemed substantiated for meal and incidental expenses or for inci- dental expenses only under section 4.03, 4.05, or 5 of this revenue procedure for partial days of travel away from home. For purposes of determining the amount deemed substantiated for a reimbursement for lodging, meal, and incidental expenses under section 4.01, 4.02, or 5 of this rev- enue procedure for partial days of travel away from home, a payor may use either of the following methods to prorate the federal M&IE rate to determine the feder- al per diem rate or the federal M&IE rate for the partial days of travel: (1) The rate may be prorated using the method prescribed by the Federal Trav- el Regulations for meal and incidental expenses for partial days, see 41 C.F.R. 301-11.101, by allocating three-fourths of the applicable rate to each partial day of travel; or (2) The rate may be prorated using any method that is consistently applied and is consistent with reasonable business prac- tice. For example, if an employee travels away from home from 9 a.m. one day to 5 p.m. the next day, a method of prora- tion that results in an amount equal to two times the federal M&IE rate is consistent with reasonable business practice (even though the Federal Travel Regulations al- low only one and a half times the federal M&IE rate). .05 Application of the appropriate § 274(n) limitation on meal expenses. Except as provided in section 6.05(5) of this revenue procedure, all or part of the amount of an expense deemed substanti- ated under this revenue procedure is sub- ject to the appropriate limitation under § 274(n) (see section 2.02 of this revenue procedure) on the deductibility of food and beverage expenses. (1) A taxpayer must treat the entire amount computed for meal and incidental expenses under section 4.03 of this reve- nue procedure as an expense for food and beverages. (2) If a per diem allowance is paid for meal and incidental expenses only, a pay- or must treat an amount equal to the lesser of the allowance or the federal M&IE rate for the locality of travel for each day or partial day (see section 6.04 of this reve- nue procedure) as an expense for food and beverages. (3) If a per diem allowance is paid for lodging, meal, and incidental expenses for each calendar day or partial day an em- ployee is away from home at a rate equal to or in excess of the federal per diem rate for the locality of travel, a payor must treat an amount equal to the federal M&IE rate for the locality of travel for each calendar day or partial day as an expense for food or beverages. (4) If a per diem allowance is paid for lodging, meal, and incidental expenses for each calendar day or partial day an em- ployee is away from home at a rate less than the federal per diem rate for the lo- cality of travel, a payor must: (a) Treat an amount equal to the fed- eral M&IE rate for the locality of travel for each calendar day or partial day or, if less, the amount of the allowance, as an expense for food or beverages; or (b) Treat an amount equal to 40 percent of the allowance as an expense for food or beverages. (5) None of the amount for incidental expenses computed under section 4.05 of this revenue procedure is subject to limita- tion under § 274(n). .06 No double reimbursement or de- duction. If a payor pays a per diem al- lowance in lieu of reimbursing actual lodging, meal, and incidental expenses, or meal and incidental expenses only, under section 4 or 5 of this revenue procedure, and the amount is treated as paid under an accountable plan, any additional payment for those expenses is treated as paid un- der a nonaccountable plan, is included in an employee’s gross income, is reported as wages or other compensation on the employee’s Form W-2, and is subject to withholding and payment of employ- ment taxes. Similarly, if an employee or self-employed individual computes the amount allowable as a deduction for meal and incidental expenses for travel away from home under section 4.03 or 4.04 of this revenue procedure, no other deduc- tion is allowed to the employee or self-em- ployed individual for those expenses. For example, an employee receives a per diem allowance from a payor for meal and in- December 16, 2019 1398 Bulletin No. 2019–51 cidental expenses incurred while traveling away from home and the amount is treated as paid under an accountable plan. During that trip, the employee pays for dinner for the employee and two business associ- ates. The payor reimburses as a business meal expense the meal expense for the employee and the two business associates. Because the payor also pays the employee a per diem allowance for meal and inci- dental expenses, the amount paid for the employee’s portion of the business meal expense is treated as paid under a nonac- countable plan, is reported as wages or other compensation on the employee’s Form W-2, and is subject to withholding and payment of employment taxes. .07 Related parties. Sections 4.01 and 5 of this revenue procedure do not apply if a payor and an employee are related within the meaning of § 267(b), but for this pur- pose the percentage of ownership interest referred to in § 267(b)(2) is 10 percent. SECTION 7. APPLICATION .01 An employee satisfies the adequate accounting and substantiation require- ments of § 1.274-5(c) and (f)(4) and § 1.274-5T(c) if— (1) The employee uses this revenue procedure to substantiate to a payor the amount of the employee’s travel expens- es, and (2) Within a reasonable period of time, the employee also substantiates to the payor the elements of time, place, and business purpose of the travel in accor- dance with § 1.274-5T(b)(2) and (c) and § 1.274-5(c) (other than § 1.274-5(c)(2) (iii)(A)). .02 An arrangement providing per diem allowances is treated as satisfying the requirement of § 1.62-2(f)(2) of re- turning amounts in excess of expenses if an employee is required to return within a reasonable period of time (as defined in § 1.62-2(g)) any portion of the allowance that relates to unsubstantiated travel days, even though the arrangement does not re- quire the employee to return the portion of the allowance that relates to substantiated travel days and that exceeds the amount of the employee’s expenses deemed substan- tiated. For example, a payor provides an employee an advance per diem allowance for meal and incidental expenses of $250, based on an anticipated 5 days of busi- ness travel at $50 per day to a locality for which the federal M&IE rate is $46, and the employee substantiates 3 full days of business travel. The requirement to return excess amounts is treated as satisfied if the employee is required to return within a reasonable period of time (as defined in § 1.62-2(g)) the portion of the allowance that is attributable to the 2 unsubstantiat- ed days of travel ($100), even though the employee is not required to return the por- tion of the allowance ($12) that exceeds the amount of the employee’s expenses deemed substantiated under section 4.02 of this revenue procedure ($138) for the 3 substantiated days of travel. However, the $12 excess portion of the allowance is treated as paid under a nonaccountable plan as discussed in section 7.04 of this revenue procedure. .03 An employee is not required to include in gross income the portion of a per diem allowance received from a pay- or that is less than or equal to the amount deemed substantiated under the rules pro- vided in section 4 or 5 of this revenue pro- cedure if the employee substantiates the business travel expenses covered by the per diem allowance in accordance with section 7.01 of this revenue procedure. See § 1.274-5T(f)(2)(i). If the remaining requirements for an accountable plan pro- vided in § 1.62-2 are satisfied, that portion of the allowance is treated as paid under an accountable plan, is not reported as wages or other compensation on the em- ployee’s Form W-2, and is exempt from the withholding and payment of employ- ment taxes. See § 1.62-2(c)(2) and (c)(4). .04 An employee is required to include in gross income only the portion of the per diem allowance received from a payor that exceeds the amount deemed substantiated under the rules provided in section 4 or 5 of this revenue procedure if the employee substantiates the business travel expenses covered by the per diem allowance in ac- cordance with section 7.01 of this revenue procedure. See § 1.274-5T(f)(2)(ii). In ad- dition, the excess portion of the allowance is treated as paid under a nonaccountable plan, is reported as wages or other com- pensation on the employee’s Form W-2, and is subject to withholding and payment of employment taxes. See § 1.62-2(c)(3) (ii), (c)(5), and (h)(2)(i)(B). .05 An employee described in § 62(a) (2)(B)-(E) who pays or incurs meal ex- penses and does not receive a per diem al- lowance for meal and incidental expenses may deduct an amount computed under section 4.03 of this revenue procedure in computing adjusted gross income. As an above-the-line deduction, such amount for such an employee is determined without regard to § 67, but is subject to the lim- itations set forth in § 62(a)(2)(B)-(E) and § 274(n). During the suspension period, a taxpayer may not deduct unreimbursed employee travel expenses as itemized de- ductions under § 67 in computing taxable income. .06 An employee described in § 62(a) (2)(B)-(E) who does not pay or incur amounts for meal expenses and does not receive a per diem allowance for inciden- tal expenses may deduct an amount com- puted under section 4.05 of this revenue procedure in computing adjusted gross income. As an above-the-line deduc- tion, such amount for such an employee is determined without regard to § 67, but is subject to the limitations set forth in § 62(a)(2)(B)-(E). During the suspension period, a taxpayer may not deduct unreim- bursed employee travel expenses as item- ized deductions under § 67 in computing taxable income. .07 If the amount of the expenses that is deemed substantiated under the rules provided in sections 4.01, 4.02, or 5 of this revenue procedure is less than the amount of an employee’s business ex- penses for travel away from home, an employee described in § 62(a)(2)(B)-(E) may deduct, in computing adjusted gross income, the amount by which the busi- ness travel expenses exceed the amount that is deemed substantiated, provided the employee substantiates all the busi- ness travel expenses (not just the excess over the federal per diem rate), includes on Form 2106, “Employee Business Ex- penses,” the deemed substantiated por- tion of the per diem allowance received from the payor, and includes in gross in- come the portion (if any) of the per diem allowance received from the payor that exceeds the amount deemed substantiat- ed. See § 1.274-5T(f)(2)(iii). However, Bulletin No. 2019–51 1399 December 16, 2019 for purposes of claiming this deduction for meal and incidental expenses, sub- stantiation of the amount of the expenses is not required if the employee is claim- ing a deduction that is equal to or less than the amount computed under section 4.03 of this revenue procedure minus the amount deemed substantiated under sec- tions 4.02 and 7.01 of this revenue pro- cedure. The amount of the deduction is determined without regard to § 67, and is subject to the limitations set forth in § 62(a)(2)(B)-(E) and § 274(n). .08 A self-employed individual who pays or incurs meal expenses for a cal- endar day or partial day of travel away from home may deduct an amount com- puted under section 4.03 of this revenue procedure in determining adjusted gross income under § 62(a)(1), subject to the appropriate limitation on meal expenses in § 274(n). .09 A self-employed individual who does not pay or incur meal expenses for a calendar day or partial day of travel away from home may deduct an amount com- puted under section 4.05 of this revenue procedure in determining adjusted gross income under § 62(a)(1). SECTION 8. WITHHOLDING AND PAYMENT OF EMPLOYMENT TAXES .01 The portion of a per diem allow- ance, if any, that relates to the days of business travel substantiated and that ex- ceeds the amount deemed substantiated for those days under section 4.01, 4.02, or 5 of this revenue procedure is treated as paid under a nonaccountable plan and is subject to withholding and payment of employment taxes. See § 1.62-2(h)(2)(i) (B). .02 In the case of a per diem allowance paid as a reimbursement, the excess de- scribed in section 8.01 of this revenue pro- cedure is subject to withholding and pay- ment of employment taxes in the payroll period in which a payor reimburses the ex- penses for the days of travel substantiated. See § 1.62-2(h)(2)(i)(B)(2). .03 In the case of a per diem allowance paid as an advance, the excess described in section 8.01 of this revenue procedure is subject to withholding and payment of employment taxes no later than the first payroll period following the payroll peri- od in which the days of travel for which the advance was paid are substantiated. See § 1.62-2(h)(2)(i)(B)(3). If an employ- ee does not substantiate some or all of the days of travel for which the advance was paid within a reasonable period of time or does not return the portion of the allow- ance that relates to those days within a reasonable period of time, the portion of the allowance that relates to those days is subject to withholding and payment of employment taxes no later than the first payroll period following the end of the reasonable period. See § 1.62-2(h)(2)(i) (A). .04 In the case of a per diem allowance only for meal and incidental expenses for travel away from home paid to an employ- ee in the transportation industry by a payor that uses the rule in section 4.04(4) of this revenue procedure, the excess of the per diem allowance paid for the period over the amount deemed substantiated for the period under section 4.02 of this revenue procedure (after applying section 4.04(4) of this revenue procedure), is subject to withholding and payment of employment taxes no later than the first payroll period following the payroll period in which the excess is computed. See § 1.62-2(h)(2)(i) (B)(4). .05 For example, an employer pays an employee a per diem allowance under an arrangement that otherwise meets the re- quirements of an accountable plan to cov- er business expenses for meals and lodg- ing for travel away from home at a rate of 120 percent of the federal per diem rate for the localities to which the employee trav- els. The employer does not require the em- ployee to return the 20 percent by which the reimbursement for those expenses ex- ceeds the federal per diem rate. The em- ployee substantiates 6 days of travel away from home: 2 days in a locality where the federal per diem rate is $150 and 4 days in a locality where the federal per diem rate is $130. The employer reimburses the employee $984 for the 6 days of travel away from home (2 x (120% x $150) + 4 x (120% x $130)), and does not require the employee to return the excess payment of $164 (2 days x $30 ($180-$150) + 4 days x $26 ($156-$130)). For the payroll period in which the employer reimburses the ex- penses, the employer must withhold and pay employment taxes on $164. See sec- tion 8.02 of this revenue procedure. .06 All payments to an employee un- der a per diem allowance arrangement are treated as paid under a nonaccount- able plan if the reimbursement arrange- ment evidences a pattern of abuse. An arrangement evidences a pattern of abuse if, for example, it has no process to de- termine when an allowance exceeds the amount that may be deemed substanti- ated and the arrangement routinely pays allowances in excess of the amount that may be deemed substantiated without requiring actual substantiation or repay- ment of the excess amount, or treating the excess allowances as wages for em- ployment tax purposes. See § 62(c), § 1.62-2(k), and Rev. Rul. 2006-56, 2006-2 C.B. 874. Thus, these payments are in- cluded in the employee’s gross income, are reported as wages or other compen- sation on the employee’s Form W-2, and are subject to withholding and payment of employment taxes. See § 1.62-2(c)(3), (c)(5), and (h)(2). .07 If a payor arranges to pay an amount to an employee regardless of whether the employee incurs (or is rea- sonably expected to incur) deductible business expenses or other bona fide ex- penses related to the employer’s business that are not deductible, the arrangement does not meet the business connection re- quirement of § 1.62-2(d) and all amounts paid under the arrangement are treated as paid under a nonaccountable plan. Thus, an arrangement that recharacterizes tax- able wages as nontaxable reimburse- ments or allowances in order to avoid the suspension of miscellaneous itemized deductions under § 67(g) does not satis- fy the business connection requirement of the accountable plan rules under § 62(c) and the applicable regulations. See § 62(c), § 1.62-2(d), and Rev. Rul. 2012- 25, 2012-37 I.R.B. 337. SECTION 9. EFFECTIVE DATE This revenue procedure is effective for per diem allowances for lodging, meal and incidental expenses, or for meal and incidental expenses only that are paid to December 16, 2019 1400 Bulletin No. 2019–51 an employee on or after November 26, 2019, for travel away from home on or after November 26, 2019. For purposes of computing the amount allowable as a deduction for travel away from home, this revenue procedure is effective for meal and incidental expenses or for incidental expenses only paid or incurred on or af- ter November 26, 2019. Notwithstanding the effective date in this section 9, amend- ments made by the TCJA to § 67 are ef- fective for taxable years beginning after December 31, 2017, and to § 274 are ef- fective for amounts incurred or paid after December 31, 2017. SECTION 10. EFFECT ON OTHER DOCUMENTS Rev. Proc. 2011-47 is modified, and as modified, is superseded on November 26, 2019. DRAFTING INFORMATION The principal author of this revenue procedure is Maxine Woo-Garcia of the Office of Associate Chief Counsel (In- come Tax & Accounting). For further information regarding this revenue pro- cedure contact Ms. Woo-Garcia at (202) 317-7005 (not a toll-free number) or the individual identified in the most recent an- nual per diem notice. Bulletin No. 2019–51 i December 16, 2019 Definition of Terms Revenue rulings and revenue procedures (hereinafter referred to as “rulings”) that have an effect on previous rulings use the following defined terms to describe the effect: Amplified describes a situation where no change is being made in a prior pub- lished position, but the prior position is being extended to apply to a variation of the fact situation set forth therein. Thus, if an earlier ruling held that a principle ap- plied to A, and the new ruling holds that the same principle also applies to B, the earlier ruling is amplified. (Compare with modified, below). Clarified is used in those instances where the language in a prior ruling is be- ing made clear because the language has caused, or may cause, some confusion. It is not used where a position in a prior rul- ing is being changed. Distinguished describes a situation where a ruling mentions a previously pub- lished ruling and points out an essential difference between them. Modified is used where the substance of a previously published position is being changed. Thus, if a prior ruling held that a principle applied to A but not to B, and the new ruling holds that it applies to both A and B, the prior ruling is modified because it corrects a published position. (Compare with amplified and clarified, above). Obsoleted describes a previously pub- lished ruling that is not considered deter- minative with respect to future transactions. This term is most commonly used in a ruling that lists previously published rulings that are obsoleted because of changes in laws or regulations. A ruling may also be obsoleted because the substance has been included in regulations subsequently adopted. Revoked describes situations where the position in the previously published ruling is not correct and the correct position is being stated in a new ruling. Superseded describes a situation where the new ruling does nothing more than restate the substance and situation of a previously published ruling (or rulings). Thus, the term is used to republish under the 1986 Code and regulations the same position published under the 1939 Code and regulations. The term is also used when it is desired to republish in a single ruling a series of situations, names, etc., that were previously published over a period of time in separate rulings. If the new ruling does more than restate the sub- stance of a prior ruling, a combination of terms is used. For example, modified and superseded describes a situation where the substance of a previously published ruling is being changed in part and is continued without change in part and it is desired to restate the valid portion of the previous- ly published ruling in a new ruling that is self contained. In this case, the previously published ruling is first modified and then, as modified, is superseded. Supplemented is used in situations in which a list, such as a list of the names of countries, is published in a ruling and that list is expanded by adding further names in subsequent rulings. After the original ruling has been supplemented several times, a new ruling may be published that includes the list in the original ruling and the additions, and supersedes all prior rul- ings in the series. Suspended is used in rare situations to show that the previous published rulings will not be applied pending some future action such as the issuance of new or amended regulations, the outcome of cas- es in litigation, or the outcome of a Ser- vice study. Abbreviations The following abbreviations in current use and formerly used will appear in material published in the Bulletin. A—Individual. Acq.—Acquiescence. B—Individual. BE—Beneficiary. BK—Bank. B.T.A.—Board of Tax Appeals. C—Individual. C.B.—Cumulative Bulletin. CFR—Code of Federal Regulations. CI—City. COOP—Cooperative. Ct.D.—Court Decision. CY—County. D—Decedent. DC—Dummy Corporation. DE—Donee. Del. Order—Delegation Order. DISC—Domestic International Sales Corporation. DR—Donor. E—Estate. EE—Employee. E.O.—Executive Order. ER—Employer. ERISA—Employee Retirement Income Security Act. EX—Executor. F—Fiduciary. FC—Foreign Country. FICA—Federal Insurance Contributions Act. FISC—Foreign International Sales Company. FPH—Foreign Personal Holding Company. F.R.—Federal Register. FUTA—Federal Unemployment Tax Act. FX—Foreign corporation. G.C.M.—Chief Counsel’s Memorandum. GE—Grantee. GP—General Partner. GR—Grantor. IC—Insurance Company. I.R.B.—Internal Revenue Bulletin. LE—Lessee. LP—Limited Partner. LR—Lessor. M—Minor. Nonacq.—Nonacquiescence. O—Organization. P—Parent Corporation. PHC—Personal Holding Company. PO—Possession of the U.S. PR—Partner. PRS—Partnership. PTE—Prohibited Transaction Exemption. Pub. L.—Public Law. REIT—Real Estate Investment Trust. Rev. Proc.—Revenue Procedure. Rev. Rul.—Revenue Ruling. S—Subsidiary. S.P.R.—Statement of Procedural Rules. Stat.—Statutes at Large. T—Target Corporation. T.C.—Tax Court. T.D.—Treasury Decision. TFE—Transferee. TFR—Transferor. T.I.R.—Technical Information Release. TP—Taxpayer. TR—Trust. TT—Trustee. U.S.C.—United States Code. X—Corporation. Y—Corporation. Z—Corporation. December 16, 2019 ii Bulletin No. 2019–51 Numerical Finding List 1 Bulletin 2019–51 AOD: 2019-02, 2019-41 I.R.B. 806 2019-03, 2019-42 I.R.B. 934 Announcements: 2019-07, 2019-27 I.R.B. 62 2019-08, 2019-32 I.R.B. 621 2019-10, 2019-46 I.R.B. 1049 Notices: 2019-12, 2019-27 I.R.B. 57 2019-40, 2019-27 I.R.B. 59 2019-41, 2019-28 I.R.B. 256 2019-42, 2019-29 I.R.B. 352 2019-27, 2019-31 I.R.B. 484 2019-43, 2019-31 I.R.B. 487 2019-24, 2019-31 I.R.B. 489 2019-45, 2019-32 I.R.B. 593 2019-48, 2019-36 I.R.B. 678 2019-46, 2019-37 I.R.B. 695 2019-49, 2019-37 I.R.B. 699 2019-50, 2019-37 I.R.B. 700 2019-47, 2019-39 I.R.B. 731 2019-51, 2019-41 I.R.B. 866 2019-52, 2019-41 I.R.B. 869 2019-54, 2019-42 I.R.B. 935 2019-55, 2019-42 I.R.B. 937 2019-58, 2019-44 I.R.B. 1022 2019-56, 2019-45 I.R.B. 1046 2019-59, 2019-47 I.R.B. 1091 2019-60, 2019-49 I.R.B. 1292 2019-61, 2019-49 I.R.B. 1294 2019-63, 2019-51 I.R.B. 1390 Proposed Regulations: REG-105476-18, 2019-27 I.R.B. 63 REG-106282-18, 2019-28 I.R.B. 259 REG-101828-19, 2019-29 I.R.B. 412 REG-106877-18, 2019-30 I.R.B. 441 REG-121508-18, 2019-30 I.R.B. 456 REG-105474-18, 2019-31 I.R.B. 493 REG-118425-18, 2019-31 I.R.B. 539 REG-130700-14, 2019-36 I.R.B. 681 REG-101378-19, 2019-37 I.R.B. 702 REG-104554-18, 2019-39 I.R.B. 737 REG-104870-18, 2019-39 I.R.B. 754 REG-102508-16, 2019-40 I.R.B. 777 REG-125710-18, 2019-40 I.R.B. 785 REG-106808-19, 2019-41 I.R.B. 912 REG-136401-18, 2019-42 I.R.B. 960 REG-104223-18, 2019-43 I.R.B. 989 REG-118784-18, 2019-44 I.R.B. 1024 Proposed Regulations:—Continued REG-128246-18, 2019-44 I.R.B. 1037 REG-123112-19, 2019-47 I.R.B. 1104 REG-131071-18, 2019-48 I.R.B. 1217 REG-132210-18, 2019-48 I.R.B. 1232 REG-118378-19, 2019-50 I.R.B. 1310 Revenue Rulings: 2019-16, 2019-28 I.R.B. 96 2019-17, 2019-32 I.R.B. 583 2019-18, 2019-35 I.R.B. 668 2019-19, 2019-36 I.R.B. 674 2019-20, 2019-36 I.R.B. 675 2019-21, 2019-38 I.R.B. 708 2019-22, 2019-40 I.R.B. 776 2019-23, 2019-41 I.R.B. 807 2019-24, 2019-44 I.R.B. 1004 2019-25, 2019-45 I.R.B. 1042 2019-26, 2019-49 I.R.B. 1286 2019-27, 2019-51 I.R.B. 1378 Revenue Procedures: 2019-24, 2019-29 I.R.B. 353 2019-28, 2019-32 I.R.B. 596 2019-29, 2019-32 I.R.B. 620 2019-30, 2019-33 I.R.B. 638 2019-31, 2019-33 I.R.B. 643 2019-32, 2019-33 I.R.B. 659 2019-33, 2019-34 I.R.B. 662 2019-34, 2019-35 I.R.B. 669 2019-23, 2019-38 I.R.B. 725 2019-36, 2019-38 I.R.B. 729 2019-37, 2019-39 I.R.B. 731 2019-35, 2019-41 I.R.B. 870 2019-38, 2019-42 I.R.B. 942 2019-39, 2019-42 I.R.B. 945 2019-40, 2019-43 I.R.B. 982 2019-41, 2019-44 I.R.B. 1022 2019-44, 2019-47 I.R.B. 1093 2019-43, 2019-48 I.R.B. 1107 2019-45, 2019-48 I.R.B. 1215 2019-42, 2019-49 I.R.B. 1298 2019-46, 2019-49 I.R.B. 1301 2019-48, 2019-51 I.R.B. 1392 Treasury Decisions: 9863, 2019-27 I.R.B. 1 9864, 2019-27 I.R.B. 6 9865, 2019-27 I.R.B. 27 9867, 2019-28 I.R.B. 98 9868, 2019-28 I.R.B. 252 9866, 2019-29 I.R.B. 261 9861, 2019-30 I.R.B. 433 9869, 2019-30 I.R.B. 438 9862, 2019-31 I.R.B. 477 9872, 2019-32 I.R.B. 585 Treasury Decisions:—Continued 9871, 2019-33 I.R.B. 624 9873, 2019-33 I.R.B. 630 9874, 2019-41 I.R.B. 809 9875, 2019-41 I.R.B. 856 9876, 2019-44 I.R.B. 1005 9877, 2019-44 I.R.B. 1007 9878, 2019-45 I.R.B. 1044 9879, 2019-47 I.R.B. 1052 9880, 2019-47 I.R.B. 1085 9881, 2019-49 I.R.B. 1288 9883, 2019-49 I.R.B. 1289 1 A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2018–27 through 2018–52 is in Internal Revenue Bulletin 2018–52, dated December 27, 2018. Bulletin No. 2019–51 iii December 16, 2019 Finding List of Current Actions on Previously Published Items 1 Bulletin 2019–51 1 A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2018–27 through 2018–52 is in Internal Revenue Bulletin 2018–52, dated December 27, 2018. Internal Revenue Service Washington, DC 20224 Official Business Penalty for Private Use, $300 INTERNAL REVENUE BULLETIN The Introduction at the beginning of this issue describes the purpose and content of this publication. The weekly Internal Revenue Bulletins are available at www.irs.gov/irb/. We Welcome Comments About the Internal Revenue Bulletin If you have comments concerning the format or production of the Internal Revenue Bulletin or suggestions for improving it, we would be pleased to hear from you. You can email us your suggestions or comments through the IRS Internet Home Page www.irs.gov) or write to the Internal Revenue Service, Publishing Division, IRB Publishing Program Desk, 1111 Constitution Ave. NW, IR-6230 Washington, DC 20224.
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