SECTION 3. STREAMLINED

PROCEDURES

.01 The streamlined procedures in this section apply to Eligible Qualified Plans. The term “Eligible Qualified Plan” means a Qualified Plan that has not been amended for GUST within its GUST remedial amendment period and for which an application for a determination letter that considers all of the requirements of GUST is filed by September 3, 2002. However, a plan is not an Eligible Qualified Plan if the plan is a late amender without regard to GUST (for example, in the case of a plan other than a governmental or nonelecting church plan, if the plan was not timely amended for the Tax Reform Act of 1986, the Unemployment Compensation Act of 1992 or the Omnibus Budget and Reconciliation Act of 1993.) For purposes of this revenue procedure, the failure to amend any disqualifying provision for which the GUST remedial amendment period is available will be treated as a failure to amend the plan for GUST.

.02 The procedures in this section apply to Eligible Qualified Plans in lieu of the procedures in Rev. Proc. 2001–17. Rev. Proc. 2001–17 will continue to apply to late amended plans that are not eligible under this revenue procedure, including late amended plans for which determination letter applications are not filed by September 3, 2002.

.03 The Service will, upon resolution of the determination letter application, treat an Eligible Qualified Plan as having been amended for GUST within the GUST remedial amendment period and issue a favorable determination letter if the plan sponsor has submitted payment of the fee described in section 3.04. This fee is in addition to the determination letter user fee, if applicable.

1 “GUST” refers to the following:

• the Uruguay Round Agreements Act, Pub. L. 103–465;

• the Uniformed Services Employment and Reemployment Rights Act of 1994, Pub. L. 103–353;

• the Small Business Job Protection Act of 1996, Pub. L. 104–188;

• the Taxpayer Relief Act of 1997, Pub L. 105–34;

• the Internal Revenue Service Restructuring and Reform Act of 1998, Pub. L. 105–206; and

• the Community Renewal Tax Relief Act of 2000, Pub. L. 106–554.

2002–24 I.R.B. 1187 June 17, 2002

only the incremental cost of permitting the use of the clean-burning fuel (electricity) can be taken into account when determining the allowable deduction under § 179A.

The Internal Revenue Service has received numerous inquiries from taxpayers concerning the determination of the incremental cost for specific hybrid vehicles for purposes of § 179A. This revenue procedure sets forth a process allowing a taxpayer who purchases a hybrid vehicle to rely on the original equipment manufacturer’s (or, in the case of a foreign original equipment manufacturer, its domestic distributor’s) certification of the incremental cost of the property for purposes of § 179A.

.02 Qualifying Motor Vehicles . This revenue procedure applies only to motor vehicles that meet the requirements of § 179A. In order to be eligible for the deduction under § 179A, a motor vehicle must: (1) be acquired for use by the taxpayer and not for resale and have its original use commence with the taxpayer; (2) meet the applicable federal and state emissions standards with respect to each fuel by which the vehicle is propelled; (3) be manufactured primarily for use on public streets, roads, and highways; (4) have at least four wheels; and (5) not operate exclusively on a rail or rails. Section 179A and this revenue procedure do not apply to motor vehicles that are primarily powered by electricity and qualify for the credit provided in § 30 or to motor vehicles that are used predominantly outside the United States.

.03 Deduction Amount Limitations . Under § 179A, except in the case of any truck or van with a gross vehicle weight rating greater than 10,000 pounds or any bus with a seating capacity of at least 20 adults (not including the driver), the maximum cost that may be taken into account when determining the deduction is $2,000 for motor vehicles placed in service on or before December 31, 2003. The $2,000 maximum is reduced by 25 percent for motor vehicles placed in service in calendar year 2004, 50 percent for motor vehicles placed in service in calendar year 2005, and 75 percent for motor vehicles placed in service in calendar year 2006. No deduction is allowed for motor vehicles placed in service after December 31, 2006. No deduction is allowed with

.04 The amount of the fee is as follows:

Number of Participants (per Form 5300 or Form 5307) Fee 1 - 100 $1,000 101 - 1000 $3,000 1001 or more $10,000

.05 If the plan sponsor of a late amended Qualified Plan does not resolve the failure to timely amend the plan under this revenue procedure or under Rev. Proc. 2001–17, the plan will be subject to disqualification.