Part IV. Items — Internal Revenue Bulletin 1998-30

Special Analysis

It has been determined that this notice of proposed rulemaking is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It has also been determined that this regulation does not have a significant impact on small entities because this regulation, which only contains a limited effective date rule, impacts only U.S. corporations with investments in foreign corporations. Thus, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply to these regulations, and therefore, a Regulatory Flexibility Analysis is not required. Pursuant to section 7805(f) of the Internal Revenue Code, this notice of proposed rulemaking will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.

Comments

Before these proposed regulations are adopted as final regulations, consideration will be given to any written comments (a signed original and eight (8) copies) that are submitted timely to the Internal Revenue Service. All comments will be available for public inspection and copying.

Drafting Information

The principal author of these proposed regulations is Philip L. Tretiak of the Office of Associate Chief Counsel (International), IRS. However, other personnel from the IRS and the Treasury Department participated in their development.

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Proposed Amendments to the Regulations

Accordingly, 26 CFR part 1 is proposed to be amended as follows:

PART 1—INCOME TAXES

Paragraph 1. The authority citation for part 1 continues to read in part as follows:

Authority: 26 U.S.C. 7805. * * *

§1.367(b)–6 [Amended]

Par. 2. Section 1.367(b)–6, as proposed to be added on Monday, August 26, 1991

Foreign Liquidations and Reorganizations; Amendment

Announcement 98–69

AGENCY: Internal Revenue Service (IRS), Treasury

ACTION: Amendment to notice of proposed rulemaking.

SUMMARY: This document removes from an existing (1991) notice of proposed rulemaking [INTL–54–91; INTL–178–86, 1991–2 C.B. 1070] the special (August 26, 1991) effective date rule for the definition of the all earnings and profits amount. The IRS and the Treasury Department believe that issues regarding the all earnings and profits amount should be studied; thus, when final regulations under section 367(b) are issued with respect to the all earnings and profits amount, such regulations will have a prospective effective date. This modification may affect domestic corporations in connection with an acquisition of a foreign corporation in a liquidation described in section 332 or in an asset acquisition described in section 368(a)(1)).

DATES: Written comments must be received by September 17, 1998.

ADDRESSES: Send submissions to: CC:DOM:CORP:R (REG–209035–86), Room 5228, Internal Revenue Service, POB 7604, Ben Franklin Station, Washington, DC 20044. In the alternative, submissions may be hand delivered between the hours of 8 a.m. and 5 p.m. to: CC:DOM:CORP:R (REG–209035–86), Courier’s Desk, Internal Revenue Service, 1111 Constitution Ave., NW, Washington, DC.

FOR FURTHER INFORMATION CONTACT: Philip L. Tretiak at (202) 6223860 (not a toll-free call).

SUPPLEMENTARY INFORMATION:

Background

Section 367(b) was enacted in its current form by the Tax Reform Act of 1976. On December 27, 1977, proposed and temporary regulations §§7.367(b)–1 through 7.367(b)–12 were adopted (T.D.

7530, 1978–1 C.B. 92). Prior to the issuance of a notice of proposed rulemaking in 1991 (the 1991 proposed regulations), discussed below, the regulations under section 367(b) were amended on several occasions. The 1991 proposed regulations, which were published in the Federal Register on August 26, 1991 (56 F.R. 41993), propose to completely revise the regulations under section 367(b), as well as the rules under section 367(a) with respect to certain transfers of stock or securities by U.S. persons to foreign corporations.

Section 1.367(b)–6(a) of the proposed regulations provides that the rules contained in the section 367(b) proposed regulations will be effective for exchanges that occur on or after the date that is 30 days after final regulations are published. However, an exception to the general effective date provides that §1.367(b)–2(d) (relating to the definition and computation of the “all earnings and profits amount”) is effective for exchanges that occur on or after August 26, 1991. T.D. 8770, a package of final regulations, published in 1998–27 I.R.B. 4, contains final rules with respect to the section 367(a) portion of the 1991 proposed regulations (to the extent that such rules were not previously finalized) and final rules with respect to the section 367(b) portion of the 1991 proposed regulations, but generally only to the extent that a particular transaction is subject to both sections 367(a) and (b). The final regulations do not address the all earnings and profits amount.

The IRS and the Treasury Department believe that issues regarding the all earnings and profits amount should be studied before final regulations are promulgated. Moreover, the IRS and the Treasury Department believe that the final regulations concerning the all earnings and profits amount should not be subject to a special effective date. Thus, this notice of proposed rulemaking removes from the 1991 proposed regulations the special (August 26, 1991) effective date rule for the definition of the all earnings and profits amount. When final regulations under section 367(b) are issued with respect to the all earnings and profits amount, such regulations will have a prospective effective date.

July 27, 1998 16 1998–30 I.R.B.

(56 F.R. 42015), is amended by removing the last sentence of paragraph (a).

Michael P. Dolan, Deputy Commissioner of

Internal Revenue.

(Filed by the Office of the Federal Register on June 18, 1998, 8:45 a.m., and published in the issue of the Federal Register for June 19, 1998, 63 F.R. 33595)

Deletions from Cumulative List of Organizations Contributions to Which Are Deductible Under Section 170 of the Code

Announcement 98–70

The names of organizations that no longer qualify as organizations described in section 170(c)(2) of the Internal Revenue Code of 1986 are 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 July 27, 1998, 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.

Larry Lee Ministries

Rowlett, TX

Share, Inc.

Chicago, IL

Foundations Status of Certain Organizations

Announcement 98–71

Development Corporation, Metairie, LA

Oromo Community in San Diego, San

Diego, CA Owensboro Rotary Club Foundation Inc.,

Owensboro, KY Pak Impak, Doylestown, PA Pan African Federation Organization Inc.,

Philadelphia, PA Parent Teacher Organization of Benvenue

Elementary School, Rocky Mount, NC Parents Reaching Out of Davidson

County, Lexington, NC Parents Teach Parents English as a

The following organizations have failed to establish or have been unable to maintain their status as public charities or as operating foundations. Accordingly, grantors and contributors may not, after this date, rely on previous rulings or designations in the Cumulative List of Organizations (Publication 78), or on the presumption arising from the filing of notices under section 508(b) of the Code. This listing does not indicate that the organizations have lost their status as organizations described in section 501(c)(3), eligible to receive deductible contributions.

Former Public Charities. The following organizations (which have been treated as organizations that are not private foundations described in section 509(a) of the Code) are now classified as private foundations: Oconee Greenway Organization Inc.,

Second Language Inc., Saddle River, NJ Park City Youth Coalition I Incorporated,

Association, Miami, FL Personal Development Institute Inc.,

Park City, UT Park Falls Area Community Foundation

Inc., Park Falls, WI Partners for Independence Inc., Piney

Flats, TN Partnerships in Building Illinois, Peoria,

IL Pathways Inc., Reidsville, NC Patricia Stevens College Foundation Inc.,

St. Louis, MO P A W Safety Charities, Dallas, TX Peachtree City Concert Band Inc.,

Peachtree City, GA Pebbles of Faith, Inc., Bolivar, MO Pennsylvania Advisory Committee on

Athens, GA Ohio Emergency Response Center,

Alcohol Drugs and Disabilities, Philadelphia, PA People Reaching Out Center, Chicago, IL Perrine Baseball and Softball

London, OH Oklahoma Coalition for Victims Rights

Tucson, AZ Phoenix Center Association, Phoenix,

AZ Physicians for a Violence-Free Society,

Inc., Tulsa, OK Old Erie Community Development

Corporation, Evansville, IN On the Daddy Track Inc., New

Berlinville, PA Open Hands Ministry Inc., Buford,

Dallas, TX Pikes Peak Festival of Learning Inc.,

Colorado Springs, CO Pines of McCormick, McCormick, SC Pioneering Black America Foundation,

GA Operation Save the Children Inc.,

Wentzville, MO Pittsburgh Community Reinvestment

San Antonio, TX Operation S T R E E T S Inc.,

Jacksonville, FL Orangedale Parent-Teacher-Student

Organization, Phoenix, AZ Orchid Association, Middletown, OH Orland Park Pioneer Wrestling Boosters

Group, Pittsburgh, PA Plexus, Richmond, VA Plymouth Housing Alliance, Plymouth,

MN Ponte Vedra-Palm Valley Athletic

Association Inc., Ponte Verda Beach, FL Posey International Center for the Study

Association, Orland Park, IL Orleans Community Housing

of Traditional Knowledge, Henderson, KY

1998–30 I.R.B. 17 July 27, 1998

Present Time Dream Factory, Santa Fe,

Salvation Army Reno Residences Inc.,

Seagoville, TX Stop Sudden Infant Death Syndrome

NM Presentation Catholic Church

Stephens Evangelistic Association, Inc.,

Foundation Inc., Stoughton, WI Summit County Rotary Foundation,

Beckenridge, CO Summit Educational Ass. Inc., New

Community in Action Inc., Chicago, IL Prestonburg-Floyd County Public

Rancho Palos Verdes, CA Satellite Touch Down Club Inc., Satellite

Beach, FL Scat Association, Middletown, OH Scenic Associates, Wilmington, NC Scholastic Art Awards of Central Indiana

Minnesota, Cottage Grove, MN Stoughton Rotary Special Projects

Properties Corporation, Prestonburg, KY Prevention Place Inc., Forest City, NC Probationers Educational Growth

Berlin, WI Super Leaders Incorporated, Washington,

DC Sussex County Foundation for Special

Needs Inc., Sparta, NJ Teacher Education Foundation, Baton

Advisory Council Inc., New Port Richey, FL Professional Ski Instructors of America Intermountain Division, Salt Lake City, UT Project Goodwill Inc., Columbus, OH Project Help of West Orlando, Orlando,

Inc., Indianapolis, IN Science Exposures Inc., Rochester, MN Seneca Falls, Chicago, IL Senior Citizen Housing Alliance,

Longmont, CO Share Arkansas, Little Rock, AR Sids Alliance of Illinois Inc., Glenview,

IL Singing Americans of Stanley County

North Carolina Inc., Badin, NC Singles Helping Others Inc., Princeton,

FL Project S T A R S, Baytown, TX Project Training Education and

Rouge, LA Teamster Disaster Relief Fund,

Washington, DC Teen Reach Corporation, Crestwood, IL Teens Educators Moms Pops

Organization Tempo of Lakeland, Lakeland, FL Tendu Inc., Houston, TX Tennessee Art Education Association,

Motivation Inc., Beavercreek, OH Pyramid Recovery Center, Memphis, TN Quakertown Community Hospital

NJ Sluggers Forever Inc., New Ulm, MN Smith College Class of 1988,

San Antonio, TX Snyder Educational Enrichment

Medical Foundation, Bethlehem, PA Quantum Testing and Research Institute,

Park Forest, IL Raphael Heights Homes Inc., Phila, PA Reality Theatre Company, Albuquerque,

Minneapolis, MN South Beach Film Festival Inc., North

Miami Beach, FL South George Street Community

Foundation, Snyder, OK Society for Chronic Diseases,

Waverly, TN Tennessee Early Intervention Network

for Children with Disabilities, Nashville, TN Terrapin Theatre, Chicago, IL Tewsbury Athletic Association Inc.,

NM Red Path Inc., Flagstaff, AZ Renaissance Economic Development

Project of Park Heights Inc., Baltimore, MD Resource Reutilization Network Inc.,

Association Inc., Lehigh Acres, FL Southeast Asian American Community

Organization LTD, Des Moines, IA Southeastern Minnesota High School

Partnership, York, PA South Gulf Basketball Officials

Califon, NJ Thacker Avenue Elementary PTO,

Leonia, NJ Resourcemobile Inc., Miami, FL Resurrection Catholic School

Endowment Fund, Lakeland, FL Rev. Willie L. Jordan Community Service

Honors Choir, Byron, MN Southern Nursing Research Society,

Columbia, SC Southern Orthodox Radio

Center Inc., Harvey, IL Rio Vista Equipo Medico Inc.,

Kissimmee, FL The D. Association for Youth, Seattle,

WA Thirty One Cuozzo St. Inc., Belleville,

NJ 3-Dimensional Recovery Services Inc., Oklahoma City, OK 311 Main Street, Carnegie, PA Thunderbird Clubhouse Board Inc.,

Norman, OK Tight & Shiny Theater Productions,

Shrewsbury, NJ River Cities Boy Choir, Parkersburg, WV Riverfront Musical Festival Inc., Tampa,

FL Riverside Development Corporation Inc.,

Communications Enterprises Source, Miami, FL Southwest Museum Foundation Inc.,

Mesa, AZ Sparta White County Citizens for the

Arts, Sparta, TN Sprague High School Choir Boosters

Chicago, IL Top of Florida Soccer Club Inc.,

Minneapolis, MN River View Health Systems Inc.,

Tallahessee, FL Topeka Teens Making a Difference Inc.,

Topeka, KS Tow Operators Working to Eliminate

Erdenheim, PA Robert Abbott Middle School PTO,

Foundation Inc., Salem, OR Springview Substance Abuse & Outreach

Waukegan, IL Robert E. Willis Sr. Gift Book Program

Program, Chat, TN St. Landry High School Rodeo

Association, Opelousas, LA St. Marthas Housing II Inc., Sarasota, FL St. Paul Midway Lions Club Foundation

Drunk Driving Inc., Greencastle, IN Towncreek Vision Corp., Leland, NC Transistional Units Assisting Mankind,

Houston, TX Trautwein School Mothers Club of the

Mehlville School District, St. Louis, MO Trees for Memphis Incorporated,

Inc., Murfreesboro, TN Ros Inc., Birmingham, AL Rotary Club of Niles Morton Grove

Charitable Foundation, Niles, IL R-USA, Evergreen, CO Safe Campuses Now Inc., Athens, GA Safe Talk Inc., Littlestown, PA

Inc., W. St. Paul, MN St. Thomas All Stars Steel Band,

Rio Rancho, NM

St. Thomas, VI Stapleton Coyote Booster Club,

Germantown, TN

July 27, 1998 18 1998–30 I.R.B.

West Tennessee Cares, Jackson, TN Western States Conference for Pharmacy

Trenton Park Neighborhood Corporation,

Victim Sensitive Intervention Program,

Chicago, IL Victory Through L O V E Inc., Deland,

Washington, DC Trinity Family Center, Lancaster, PA Tulsa Youth Hockey Association, Tulsa,

FL Village Conservancy Inc., Cashiers, NC Virginia Gay Hospital, Vinton, IA Visually Impaired-Blind Support Training

Residents Fellowships, Stockton, CA Westmoreland Chodo Inc., Latrobe, PA Westmoreland Human Services Inc.,

Greensburg, PA Westpine Middle School Parent Teacher

Organization, Sunrise, FL Whitestone Corporation, Lumberton, NJ Wilson County Transportation Service

OK Turner Jackson Memorial Fund Inc.,

Trenton, NJ Tyler Home Health Services,

Tunkhannock, PA U-Care Inc., Milwaukee, WI United Black Fund of Prince Georges

County Maryland Inc., Hyattsville, MD United Sponsors Society, Sicklerville, NJ United States Driving Foundation, Inc.,

and Assistance Group, Blythe, CA VJS Inc., Seneca, PA Volunteer Action Center of Indian River

County Inc., Vero Beach, FL Volunteer Council for the Arizona Dept.

of Youth Treatment and Rehabilitation, Phoenix, AZ Walk Worthy Inc., Altamonte Springs, FL Wall St. Danceworks Inc., Asheville, NC War Casualties Memorial Association

Inc., Wilson, NC Windsor Freer Parents Association,

Imperial, MO Winstanley-Industry Park Neighborhood

Organization, East St. Louis, IL With Love Foundation Inc., Houston, TX Wives Clubs Thrift Shop, Great Falls, MT World Medical Relief, Geneva, IL Wyoming Agricultural Leadership

Annapolis, MD Unity Hospice Care Inc., Morgantown,

Inc., Phenix City, AL Ward Family Foundation Inc., Chicago,

Council, Cheyenne, WY Yacai Inc., Baltimore, MD Yale Hospital Properites Inc., Yale, MI Young Virtuosos International, Dallas,

TX Youth Sports Association, Long Beach,

WV Unitversity of Minnesota M. Club

IL Warren Police Drug Abuse Resistance

Foundation, St. Louis, MN Up on the Mountain Inc., Signal

Mountain, TN Up With Down Syndrome Inc.,

Columbus, GA Uplift Recovery Home Inc., Chicago, IL Upper Valley Association for the

Education of Young Children, Piqua, OH Uptown Lenoir Heritage Association Inc.,

Education D A R E Inc., Warren, MI Washington Action Line, New Orleans,

LA Wayzata Womens Choir, Wayzata, MN Weber Human Services, Ogden, UT Well-Spring, Allentown, PA Wellspring Ministries, Whitehall, PA Wesley Agape House Inc., Alexandria,

VA West Cecil B. Moore Community

Lenoir, NC Utah Chamber Artists, Midvale, UT Veterans & Community Outreach

Foundation, Flowery Branch, GA Veterans Memorial Park Monument

Corporation, Philadelphia, PA West Central Illinois Center for

Foundation Inc., Pensacola, FL Veterans Self Help Group Foundation,

Independent Living, Quincy, IL West Mesa High School Mustang

CA If an organization listed above submits information that warrants the renewal of its classification as a public charity or as a private operating foundation, the Internal Revenue Service will issue a ruling or determination letter with the revised classification as to foundation status. Grantors and contributors may thereafter rely upon such ruling or determination letter as provided in section 1.509(a)–7 of the Income Tax Regulations. It is not the practice of the Service to announce such revised classification of foundation status in the Internal Revenue Bulletin.

Flint, MI Vetter Foundation, Omaha, NE Vicki Popdan Foundation, Gaithersburg,

Football Boosters, Albuquerque, NM West Orange High School Foundation

Inc., Windermere, FL West Tallahatchie Day Care Inc., Webb,

1998–30 I.R.B. 19 July 27, 1998