Part IV. Items of General Interest

The name of an organization that no longer qualifies as an organization described in section 170(c)(2) of the Internal Revenue Code of 1986 is listed below.

Generally, the Service will not disallow deductions for contributions made to a listed organization on or before the date of announcement in the Internal Revenue Bulletin that an organization no longer qualifies. However, the Service is not precluded from disallowing a deduction for any contributions made after an organization ceases to qualify under section 170(c)(2) if the organization has not timely filed a suit for declaratory judgment under section 7428 and if the contributor (1) had knowledge of the revocation of the ruling or determination letter, (2) was aware that such revocation was imminent, or (3) was in part responsible for or was aware of the activities or omissions of the organization that brought about this revocation.

If on the other hand a suit for declaratory judgment has been timely filed, contributions from individuals and organizations described in section 170(c)(2) that are otherwise allowable will continue to be deductible. Protection under section 7428(c) would begin on (DATE) 1997, and would end on the date the court first determines that the organization is not described in section 170(c)(2) as more particularly set forth in section 7428(c)(1). For individual contributors, the maximum deduction protected is $1,000, with a husband and wife treated as one contributor. This benefit is not extended to any individual who was responsible, in whole or in part, for the acts or omissions of the organization that were the basis for revocation.

H & M Home for Alternative Living

Detroit, MI

Extension of Test of Mediation Procedure for Appeals

Announcement 97–1

SUMMARY: This document extends the test of the mediation procedure set forth in Announcement 95–86, 1995–44 I.R.B. 27, for an additional one-year period beginning on January 13, 1997.

FOR FURTHER INFORMATION CONTACT: Thomas Carter Louthan, Director, Office of Dispute Resolution and Specialty Programs, National Office Appeals, (202) 401–4098 (not a toll-free number).

EXTENSION OF TEST OF MEDIATION PROCEDURE FOR APPEALS

Summary: This procedure allows taxpayers, in certain cases that are already in the Appeals administrative process and that are not docketed in any court, to request mediation of one or more issues as a dispute resolution technique. Under the procedure, the taxpayer and Appeals attempt to negotiate a settlement, assisted by an objective and neutral third party who has no authority to impose a decision. This document extends the test of the mediation procedure set forth in Announcement 95–86 for an additional one-year period.

Background: Announcement 95–86, which contains the procedures that taxpayers may use to request mediation, applies to issues in Coordinated Examination Program cases assigned to Appeals Team Chiefs. A one-year test of the mediation procedure concluded on October 30, 1996. During this period, nine requests for mediation were made, in which four were approved. The mediation program is consistent with IRS’ efforts to improve tax administration, provide customer service and reduce taxpayer burden. During the additional one-year test period, Appeals will try mediation in more cases so that the program can be further evaluated.

Effective Date: This Announcement ex

tends the test of the mediation procedure set forth in Announcement 95–86 for an additional one-year period beginning on January 13, 1997.

For further information contact: Thomas Carter Louthan, Director, Office of Dispute Resolution and Specialty Programs, National Office Appeals, (202) 401–4098 (not a toll-free number).

Change to Schedule Q

Announcement 97–2

This announcement modifies Schedule Q (January 1996) of the Form 5300 series applications to reflect amendments to § 401(a)(26) of the Internal Revenue Code made by § 1432 of the Small Business Job Protection Act of 1996 (SBJPA), effective for plan years beginning after December 31, 1996. Beginning with the 1997 plan year, the minimum participation requirements of § 401(a)(26) apply only to defined benefit plans. Therefore, until the application form is revised, applicants requesting a determination letter for a defined contribution plan for plan years beginning after December 31, 1996, may answer ‘‘Yes’’ to questions 2a and 2i of Part II of Schedule Q (January 1996). The additional information described in the instruction to line 2(a) (Demo 2) need not be submitted for defined contribution plans.

Applicants should note that § 401(a)(26)(A)(ii) was amended by SBJPA to require a plan to benefit at least 2 employees (or 1 employee if there is only 1 employee) for plan years after December 31, 1996. Schedule Q does not reflect this modification to § 401(a)(26)(A)(ii).

Deletions From Cumulative List of Organizations Contributions to Which are Deductible Under Section 170 of the Code

Announcement 97–3

1997-2 I.R.B. 62