Part I. Rulings — Internal Revenue Bulletin 2003-27

Section 42.—Low-Income Housing Credit

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 103.—Interest on State and Local Bonds

The Service clarifies the answers to six questions concerning tax-exempt qualified New York Liberty Bonds issued under section 1400L(d). See Notice 2003–40, page 10.

Section 280G.—Golden Parachute Payments

Federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 382.—Limitation on Net Operating Loss Carryforwards and Certain Built-In Losses Following Ownership Change

The adjusted applicable federal long-term rate is set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 412.—Minimum Funding Standards

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 446.—General Rule for Methods of Accounting

26 CFR 1.446-1: General rule for methods of accounting.

For certain accounting method changes within the inventory price index computation (IPIC) method of accounting for last-in, first-out (LIFO) inventories, the 5-year prior change scope limitation in section 4.02(6) of Rev. Proc. 2002–9,

2002–1 C.B. 327, is waived. See Rev. Proc. 2003–45, page 11.

Section 467.—Certain Payments for the Use of Property or Services

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 468.—Special Rules for Mining and Solid Waste Reclamation and Closing Costs

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 482.—Allocation of Income and Deductions Among Taxpayers

Federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 483.—Interest on Certain Deferred Payments

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 642.—Special Rules for Credits and Deductions

Federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 807.—Rules for Certain Reserves

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the

month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 846.—Discounted Unpaid Losses Defined

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 1274.—Determina- tion of Issue Price in the Case of Certain Debt Instruments Issued for Property

(Also Sections 42, 280G, 382, 412, 467, 468, 482, 483, 642, 807, 846, 1288, 7520, 7872.)

Federal rates; adjusted federal rates; adjusted federal long-term rate and the long-term exempt rate. For purposes of sections 382, 1274, 1288, and other sections of the Code, tables set forth the rates for July 2003.

Rev. Rul. 2003–71

This revenue ruling provides various prescribed rates for federal income tax purposes for July 2003 (the current month). Table 1 contains the short-term, mid-term, and long-term applicable federal rates (AFR) for the current month for purposes of section 1274(d) of the Internal Revenue Code. Table 2 contains the shortterm, mid-term, and long-term adjusted applicable federal rates (adjusted AFR) for the current month for purposes of section 1288(b). Table 3 sets forth the adjusted federal long-term rate and the long-term taxexempt rate described in section 382(f). Table 4 contains the appropriate percentages for determining the low-income housing credit described in section 42(b)(2) for buildings placed in service during the current month. Table 5 contains the federal rate for determining the present value of annuity, an interest for life or for a term of years, or a remainder or a reversionary interest for purposes of section 7520. Finally, Table 6 contains the blended annual rate for 2003 for purposes of section 7872.

2003–27 I.R.B. 1 July 7, 2003

REV. RUL. 2003–71 TABLE 1

Applicable Federal Rates (AFR) for July 2003

Period for Compounding

Annual Semiannual Quarterly Monthly Short-Term

AFR 1.23% 1.23% 1.23% 1.23% 110% AFR 1.35% 1.35% 1.35% 1.35% 120% AFR 1.49% 1.48% 1.48% 1.48% 130% AFR 1.61% 1.60% 1.60% 1.59%

Mid-Term

AFR 2.55% 2.53% 2.52% 2.52% 110% AFR 2.80% 2.78% 2.77% 2.76% 120% AFR 3.06% 3.04% 3.03% 3.02% 130% AFR 3.32% 3.29% 3.28% 3.27% 150% AFR 3.84% 3.80% 3.78% 3.77% 175% AFR 4.48% 4.43% 4.41% 4.39%

Long-Term

AFR 4.17% 4.13% 4.11% 4.09% 110% AFR 4.59% 4.54% 4.51% 4.50% 120% AFR 5.02% 4.96% 4.93% 4.91% 130% AFR 5.44% 5.37% 5.33% 5.31%

REV. RUL. 2003–71 TABLE 2

Adjusted AFR for July 2003

Period for Compounding

Annual Semiannual Quarterly Monthly

Short-term adjusted AFR

Mid-term adjusted AFR

Long-term adjusted AFR

1.09% 1.09% 1.09% 1.09%

2.29% 2.28% 2.27% 2.27%

4.05% 4.01% 3.99% 3.98%

July 7, 2003 2 2003–27 I.R.B.

REV. RUL. 2003–71 TABLE 3

Rates Under Section 382 for July 2003

Adjusted federal long-term rate for the current month 4.05%

Long-term tax-exempt rate for ownership changes during the current month (the highest of the adjusted federal long-term rates for the current month and the prior two months.) 4.45%

REV. RUL. 2003–71 TABLE 4

Appropriate Percentages Under Section 42(b)(2) for July 2003

Appropriate percentage for the 70% present value low-income housing credit 7.78%

Appropriate percentage for the 30% present value low-income housing credit 3.33%

REV. RUL. 2003–71 TABLE 5

Rate Under Section 7520 for July 2003

Applicable federal rate for determining the present value of an annuity, an interest for life or a term of years, or a remainder or reversionary interest 3.0%

REV. RUL. 2003–71 TABLE 6

Blended Annual Rate for 2003

Section 7872(e)(2) blended annual rate for 2003 1.52%

Section 1288.—Treatment of Original Issue Discounts on Tax-Exempt Obligations

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 1400L.—Tax Benefits for New York Liberty Zone

The Service clarifies the answers to six questions concerning tax-exempt qualified New York Liberty Bonds issued under section 1400L(d).

See Notice 2003–40, page 10.

Section 4980B.—Failure to Satisfy Continuation Coverage Requirements of Group Health Plans

26 CFR 54.4980B–2: Plans that must comply. (Also section 7805; § 54.4980B–9.)

Small employer plan exception to the COBRA continuation coverage require- ments in mergers and acquisitions. Guidance is provided on when a group health plan maintained by an employer that grows to have more than 20 employees through

a stock or asset acquisition is required to begin complying with the COBRA continuation coverage requirements.

Rev. Rul. 2003–70

ISSUES

If, as a result of a transfer of stock, two previously separate employers are treated as a single employer for purposes of the COBRA continuation coverage requirements, how is the number of employees who were employed by the combined entity during the preceding calendar year determined for purposes of applying to the combined entity the exception from the

2003–27 I.R.B. 3 July 7, 2003

group health plan to any employee in connection with the sale.

In Situation 1, as a result of the stock transfer, P and O are treated as a single employer for purposes of section 4980B. Accordingly, in applying the small employer plan exception of section 4980B(d) to a group health plan maintained by the combined entity following the stock transfer, employees of both P and O during the previous calendar year must be taken into account. Since P and O combined normally employed at least 20 employees during the previous calendar year, a group health plan maintained by the combined entity becomes subject to COBRA as of the date of the stock transfer.

In Situation 2, Company R acquires substantially all the assets of a business and continues the business operations associated with those assets without interruption or substantial change. R alone normally employed fewer than 20 employees during the previous calendar year, but together R and the acquired business normally employed at least 20 employees during the previous calendar year. However, the acquisition of assets by R does not cause R to be considered a single employer with any part of the seller of the assets. Thus, the group health plan maintained by R continues to be excepted from COBRA until, with the normal application of the rules for determining whether a plan is a smallemployer plan, the January 1 following a year in which R normally employed at least 20 employees. If, however, under the rules of Q&A–8(c) in § 54.4980B–9, R is a successor employer to the seller of the assets, then the group health plan of R will have the obligation to make COBRA continuation coverage available to any M&A qualified beneficiaries of the seller in accordance with the rules of Q&A–4(c) in § 54.4980B–2, even though R is otherwise excepted from COBRA.

HOLDING

In Situation 1, a group health plan maintained by the combined entity ceases to be excepted from COBRA as a small-employer plan as of the date of the stock transfer. In Situation 2, a group health plan maintained by the acquiring company continues to be excepted from COBRA as a small-employer plan for at least the remainder of the year of the asset acquisition.

COBRA continuation coverage requirements for group health plans maintained by employers that normally employed fewer than 20 employees during the preceding calendar year (the small employer plan exception)?

If one employer acquires substantial assets (such as a plant or division or substantially all the assets of a trade or business) of another employer, when are the employees associated with the acquired assets taken into account for purposes of applying the small employer plan exception to the acquiring employer?

FACTS

Situation 1 . Company P maintains a group health plan. P normally employed fewer than 20 employees during the previous calendar year. Under section 414(t) of the Internal Revenue Code, no other entity is treated as a single employer with P . During the current calendar year, stock in Corporation O is transferred so that after the transfer P and O are considered to be part of a single employer. The combined number of employees normally employed by P and O during the previous calendar year was at least 20.

Situation 2 . Company R maintains a group health plan. R normally employed fewer than 20 employees during the previous calendar year. No other entity is considered to be part of a single employer with R . During the current calendar year, R acquires substantially all the assets of a business and continues the business operations associated with those assets without interruption or substantial change. The combined number of employees normally employed by R and the acquired business during the previous calendar year was at least 20.

LAW AND ANALYSIS

Section 4980B of the Code requires certain group health plans to make continuation coverage available to certain individuals who would otherwise lose their coverage under the plan as a result of certain occurrences (the “COBRA continuation coverage requirements”). Section 4980B imposes an excise tax if a plan subject to the COBRA continuation coverage requirements fails to comply with those requirements. Section 414(t) provides that all employees who are treated as employed by a

single employer under section 414(b), (c), or (m) are treated as employed by a single employer for purposes of section 4980B and that the provisions of section 414(o) apply with respect to the requirements of section 4980B.

Section 4980B(d) of the Code and Q&A–4 of § 54.4980B–2 of the Miscellaneous Excise Tax Regulations provide that small-employer plans are excepted from COBRA. Q&A–5(a) of § 54.4980B–2 provides that, except in the case of a multiemployer plan, a small-employer plan is a plan maintained by an employer that normally employed fewer than 20 employees during the preceding calendar year. Under Q&A–5(b) of § 54.4980B–2, an employer is considered to have normally employed fewer than 20 employees during a particular calendar year if, and only if, it had fewer than 20 employees on at least 50 percent of its typical business days during that year. Under Q&A–4(c) of § 54.4980B–2, a small-employer plan otherwise excepted from COBRA is nonetheless subject to COBRA with respect to qualified beneficiaries who experience a qualifying event during a period when the plan is not a small-employer plan.

Q&A–1 of § 54.4980B–9 defines stock sale for purposes of § 54.4980B–9 as a transfer of stock in a corporation that causes the corporation to become a different employer or a member of a different employer. Under Q&A–2 of § 54.4980B–2, an employer is defined to include any person who is a member of a group described in section 414(b), (c), (m), or (o) that includes a person for whom services are performed.

Q&A–1 of § 54.4980B–9 defines asset sale for purposes of § 54.4980B–9 as a transfer of substantial assets, such as a plant or division or substantially all the assets of a trade or business. Q&A–2 of § 54.4980B–2 provides that the term employer includes a successor to a person for whom services are performed and crossreferences the rules in Q&A–8(c) of § 54.4980B–9 for determining when a purchaser of assets is a successor employer to the employer selling the assets. Under Q&A–8(c) of § 54.4980B–9, a buyer of substantial assets is not considered a successor employer to the seller of the assets unless the buyer continues the business operations associated with the purchased assets without interruption or substantial change and the seller ceases to provide any

July 7, 2003 4 2003–27 I.R.B.

taxpayers who are abroad, no such extension shall be for more than 6 months. The regulations under section 6081 provide specific rules taxpayers must follow to request an extension of time to file federal tax returns.

Under the generally applicable rule, a taxpayer must submit an application for the extension on or before the due date of the return. The application must be in writing, must be properly signed by the taxpayer or his duly authorized agent, and must clearly set forth the particular tax return for which the extension of the time for filing is desired and a full recital of the reasons for requesting the extension. These rules apply to all returns other than those for which the regulations provide special rules. In addition, the Employment Tax Regulations provide rules for employers to obtain an extension of time to file the Social Security Administration copy of Forms W–2 and W–3. Under those rules, the request must contain a concise statement of the reasons for requesting the extension.

Explanation of Provisions

Information Returns

Filers and transmitters of information returns on Form 1099 (series), 1098 (series), 5498 (series), W–2 (series), W–2G, 1042–S, and 8027 can obtain an extension of time to file these information returns by submitting a signed paper Form 8809, “Request for Extension of Time to File Information Returns.” The extensions are most often for a period of 30 days. Filers and transmitters may thereafter request an additional 30-day extension. The extensions apply only to the filing with the government. The filer or transmitter is still required to provide statements to the recipients by the date specified in the Code or the regulations.

Currently, in compliance with the regulations, Form 8809 requires a signature and asks for an explanation of the reasons for the request for an extension. In current practice, however, the explanation is not a determining factor for the initial extension. If the filer supplies the name, address, Employer Identification Number, tax year, and type of form(s), the initial extension is routinely granted. An extension beyond the initial 30-day period will not be granted, however, unless the filer provides a detailed explanation.

EFFECTIVE DATE

For purposes of the excise tax of section 4980B of the Code, this ruling is effective for stock sales and asset sales that take effect on or after July 7, 2003.

DRAFTING INFORMATION

The principal author of this revenue ruling is Russ Weinheimer of the Office of Division Counsel/Associate Chief Counsel (Tax Exempt and Government Entities). For further information regarding this revenue ruling, contact Mr. Weinheimer at (202) 622–6080 (not a toll-free number).

Section 6081.—Extension of Time for Filing Returns

26 CFR 1.6081–8T: Automatic extension of time to file certain information returns (temporary).

T.D. 9061

DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Parts 1, 31, and 602

Automatic Extension of Time to File Certain Information Returns and Exempt Organization Returns

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final and temporary regulations.

SUMMARY: This document contains temporary regulations providing an automatic extension of time to file certain information returns and exempt organization returns. The temporary regulations remove the requirement for a signature and an explanation to obtain an automatic extension of time to file these returns. The temporary regulations affect taxpayers who are required to file certain information returns and/or exempt organization returns and need an extension of time to file. The text of the temporary regulations also serves as a portion of the text of the proposed regulations set forth in the notice of proposed rulemaking (REG–107618–02) on page 13 of this issue of the Bulletin.

DATES: Effective Date : These regulations are effective on June 11, 2003.

Applicability Date : For dates of applicability for these regulations, see §§1.6081– 8T, 1.6081–9T, and 31.6081(a)–1T(d).

FOR FURTHER INFORMATION CONTACT: Charles A. Hall, (202) 622–4940 (not a toll-free number).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

These temporary regulations are being issued without prior notice and public procedure pursuant to the Administrative Procedure Act (5 U.S.C. 553). For this reason, the collection of information contained in these regulations has been reviewed and, pending receipt and evaluation of public comments, approved by the Office of Management and Budget under OMB control number 1545–1840. Responses to this collection of information are required by the IRS for taxpayers to obtain a benefit (an automatic extension of time to file certain information or exempt organization returns).

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

For further information concerning this collection of information, and where to submit comments on the collection of information and the accuracy of the estimated burden, and suggestions for reducing this burden, please refer to the preamble to the cross-referencing notice of proposed rulemaking published in this issue of the Bulletin.

Books and records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.

Background

This document contains amendments to 26 CFR parts 1, 31, and 602 under section 6081 of the Internal Revenue Code. Section 6081(a) provides that the Secretary may grant a reasonable extension of time for filing any return, declaration, statement, or other document required by Title 26 or by regulations. Except in the case of

2003–27 I.R.B. 5 July 7, 2003

Authority: 26 U.S.C. 7805 * * * Section 1.6081–8T also issued under 26 U.S.C. 6081.

Section 1.6081–9T also issued under 26 U.S.C. 6081. * * *

§1.6081–1T [Removed]

Par. 2. Section 1.6081–1T is removed. Par. 3. Section 1.6081–8T is added to read as follows:

§1.6081–8T Automatic extension of time to file certain information returns (temporary).

(a) In general . A person required to file an information return (the filer) on Form W–2 series, W–2G, 1042–S, 1098 series, 1099 series, 5498 series, or 8027 will be allowed an automatic 30-day extension of time to file the return after the date prescribed for filing the return if the filer or the person transmitting the return for the filer (the transmitter) files an application in accordance with paragraph (b) of this section.

(b) Requirements . To satisfy this paragraph (b), an application must—

(1) Be submitted on Form 8809, “Re- quest for Extension of Time To File Infor- mation Returns,” or in any other manner as may be prescribed by the Commissioner; and

(2) Be filed with the Internal Revenue Service office designated in the application’s instructions on or before the date prescribed for filing the information return.

(d) Additional 30-day extension of time to file —(1) In general . This paragraph (d) provides procedures for obtaining an additional extension of time for filing an information return on a form listed in paragraph (a) of this section. No extension of time will be granted under this paragraph (d) unless the filer or transmitter has first obtained an automatic extension.

(2) Procedures . In the case of an information return on a form listed in paragraph (a) of this section, one additional 30day extension of time to file the return may be allowed if the filer or transmitter submits a request for the additional extension before the expiration of the automatic 30-day extension. The request must— (i) Be submitted on Form 8809 or in any other manner as may be prescribed by the Commissioner;

These temporary regulations allow filers and transmitters to request an automatic 30-day extension of time to file without having to sign Form 8809 and provide an explanation. An explanation and a signature are required if filers and transmitters need additional time to file after receiving the automatic 30-day extension. These regulations also permit employers to obtain an extension of time to file the Social Security Administration copy of Forms W–2 and W–3 without providing a statement of the reasons for requesting the extension.

The new rules will allow the IRS to develop an effective online version of the extension request. Filers and transmitters will benefit from the simplified extension procedure that will provide immediate approval. The IRS will benefit from the efficiencies inherent in such a system and will move closer to achieving electronic filing goals.

Filers and transmitters are eligible for only one automatic extension of time to file. Filers and transmitters filing Forms W–2 on an expedited basis under section 31.6071(a)–1(a)(3)(ii) may receive an automatic extension of time to file Forms W–2 under Rev. Proc. 96–57, 1996–2 C.B. 389. These filers and transmitters are not eligible to obtain the 30-day automatic extension under §1.6081–8T(b). If these filers and transmitters need additional time, they may request an extension under the generally applicable procedures for obtaining additional extensions of time to file Form W–2.

Exempt Organization Returns

These temporary regulations also allow an exempt organization required to file a return on Form 990 (series), 1041–A, 4720, 5227, 6069, or 8870 an automatic three-month extension of time to file if (a) an application is submitted on Form 8868, “Application for Extension of Time To File an Exempt Organization Return,” (b) the application is filed on or before the date the return is due, (c) the application shows the full amount properly estimated as tax, and (d) the application is accompanied by full remittance of the amount properly estimated as tax that is unpaid as of the date prescribed for the filing of the return.

A signature and an explanation of the reasons for requesting the extension are not required for an exempt organization to re

ceive the automatic three-month extension of time to file. If an exempt organization needs additional time to file a return after receiving the automatic three-month extension, the exempt organization may file a signed Form 8868 that explains in detail why the additional time is needed. The IRS may grant an additional three months for the exempt organization to file.

Deadwood Provisions

These regulations also remove §1.6081–1T and §§31.6011(a)–5(b)(1) and 31.6081(a)–1(a)(2). Section 1.6081–1T is removed because it relates only to returns for tax years ending before February 1, 1985. Sections 31.6011(a)–5(b)(1) and 31.6081(a)–1(a)(2) are removed because they relate to information returns that are no longer required.

Special Analyses

It has been determined that this Treasury decision 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 section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to the regulations. For the applicability of the Regulatory Flexibility Act (5 U.S.C. chapter 6), refer to the Special Analyses section of the preamble to the cross-reference notice of proposed rulemaking published in this issue of the Bulletin. Pursuant to section 7805(f) of the Internal Revenue Code, these temporary regulations will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small businesses.

Drafting Information

The principal author of the regulations is Charles A. Hall of the Office of Associate Chief Counsel, Procedure and Administration (Administrative Provisions and Judicial Practice Division).

* * * * *

Amendments to the Regulations

Accordingly, 26 CFR parts 1, 31, and 602 are amended as follows:

PART 1—INCOME TAXES

Paragraph 1. The authority citation for part 1 is amended by adding entries in numerical order to read in part as follows:

July 7, 2003 6 2003–27 I.R.B.

Par. 9. Section 31.6081(a)–1 is amended by:

Removing paragraph (a)(2).
Redesignating paragraph (a)(3) as paragraph (a)(2).
Revising newly designated paragraph (a)(2)(i).

The revision reads as follows:

§31.6081(a)–1 Extensions of time for filing returns and other documents.

(a) - - (2) * * * (i) [Reserved]. For guidance on extensions of time to file the Social Security Administration copy of Forms W–2 and W–3 due after June 11, 2003, see §31.6081(a)–1T.

* * * * *

Par. 10. Section 31.6081(a)–1T is added to read as follows:

§31.6081(a)–1T Extensions of time for filing returns and other documents (temporary).

(a)(1) [Reserved]. For further guidance, see §31.6081(a)–1(a)(1).

(2) Information returns of employers on Forms W–2 and W–3 —(i) In general . The Commissioner may grant an extension of time in which to file the Social Security Administration copy of Forms W–2 and the accompanying transmittal form which constitutes an information return under paragraph §31.6051–2(a). For further guidance regarding extensions of time to file the Social Security Administration copy of Forms W–2 and W–3, see §1.6081–8T of this chapter.

(a)(2)(ii) through (c) [Reserved]. For further guidance, see §31.6081(a)–1(a)(2)(ii) through (c).

(d) Effective date . This section applies to requests for extensions of time to file the Social Security Administration copy of Forms W–2 and W–3 due after June 11, 2003. The applicability of this section expires on June 10, 2006.

PART 602—OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT

Par. 11. The authority citation for part 602 continues to read as follows: Authority: 26 U.S.C. 7805. Par. 12. In §602.101, paragraph (b) is amended by adding the following entries in numerical order to the table to read as follows:

(ii) Explain in detail why the additional time is needed;

(iii) Be signed by the filer or transmitter; and

(iv) Otherwise satisfy the requirements of §1.6081–1.

(e) No effect on time to provide state- ment to recipients . An extension under this section of time to file an information return does not extend the due date for providing a statement to the person with respect to whom the information is required to be reported.

(f) Effective date . This section applies to requests for extension of time to file information returns due after June 11, 2003. The applicability of this section expires on June 10, 2006.

Par. 4. Section 1.6081–9T is added to read as follows:

§1.6081–9T Automatic extension of time to file exempt organization returns (temporary).

(a) In general . An exempt organization required to file a return on Form 990 (series), 1041–A, 4720, 5227, 6069, or 8870 will be allowed an automatic three-month extension of time to file the return after the date prescribed for filing if the exempt organization files an application in accordance with paragraph (b) of this section. For guidance on extensions of time for an exempt organization to file Form 1120–POL, U.S. Income Tax Return for Certain Po- litical Organizations, see §1.6081–3.

(b) Requirements . To satisfy this paragraph (b), an application for an automatic extension under this section must—

(1) Be submitted on Form 8868, “Ap- plication for Extension of Time To File an Exempt Organization Return,” or in any other manner as may be prescribed by the Commissioner;

(2) Be filed with the Internal Revenue Service office designated in the application’s instructions on or before the date prescribed for filing the information return;

(3) Show the full amount properly estimated as tentative tax for the exempt organization for the taxable year; and

(4) Be accompanied by the full remittance of the amount properly estimated as tentative tax which is unpaid as of the date prescribed for the filing of the return.

to the exempt organization a notice of termination. The notice must be mailed at least 10 days prior to the termination date designated in such notice. The notice of termination must be mailed to the address shown on the application for extension or to the exempt organization’s last known address. For further guidance regarding the definition of last known address, see §301.6212–2 of this chapter.

(d) Penalties . See sections 6651 and 6652(c) for failure to file an exempt organization return or failure to pay the amount shown as tax on the return.

(e) Coordination with §1.6081–1 . No extension of time will be granted under §1.6081–1 for filing an exempt organization return listed in paragraph (a) of this section until an automatic extension has been allowed pursuant to this section.

(f) Effective date . This section applies to requests for extensions of time to file an exempt organization return due after June 11, 2003. The applicability of this section expires on June 10, 2006.

PART 31—EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT SOURCE

Par. 5. The authority citation for part 31 continues to read as follows:

Authority: 26 U.S.C. 7805 * * * Section 31.6081(a)–1T also issued under 26 U.S.C. 6081. * * *

Par. 6. Section 31.6011(a)–5 is amended by revising paragraph (b) to read as follows:

§31.6011(a)–5 Monthly returns.

* * * * *

(b) Information returns on Form W–3 and Social Security Administration cop- ies of Form W–2. See §31.6051–2 for requirements with respect to information returns on Form W–3 and Social Security Administration copies of Form W–2.

* * * * *

§31.6051–1 [Amended]

Par. 7. Section 31.6051–1(d)(2)(i)( c ) is amended by removing the language “§31.6081(a)–1(a)(3)” and adding “§31.6081(a)–1(a)(2)” in its place.

§31.6051–2 [Amended]

Par. 8. Section 31.6051–2(c) is amended by removing the language “31.6081(a)– 1(a)(3)” and adding “31.6081(a)–1(a)(2)” in its place.

2003–27 I.R.B. 7 July 7, 2003

§602.101 OMB Control numbers.

* * * * *

(b) * * *

CFR part or section where identified and described

Current OMB

identified and described control No.

* * * * *

1.6081–8T........................................................................................................................................................................... 1545–1840

1.6081–9T........................................................................................................................................................................... 1545–1840

* * * * *

David A. Mader, Assistant Deputy Commissioner of

Internal Revenue.

Approved May 21, 2003.

Pamela F. Olson, Assistant Secretary of the Treasury.

(Filed by the Office of the Federal Register on June 10, 2003, 8:45 a.m., and published in the issue of the Federal Register for June 11, 2003, 68 F.R. 34797)

Section 7520.—Valuation Tables

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

Section 7872.—Treatment of Loans With Below-Market Interest Rates

The adjusted applicable federal short-term, mid-term, and long-term rates are set forth for the month of July 2003. See Rev. Rul. 2003–71, page 1.

July 7, 2003 8 2003–27 I.R.B.