Bulletin No. 2005-4 January 24, 2005

or terminated, determines whether or not it is subject to current section 1374.

Notice 2005–8, page 368. This notice states that a partnership’s contributions to a partner’s Health Savings Account (HSA) may be treated as distributions under section 731 of the Code or as guaranteed payments under section 707(c). HSA contributions treated as section 731 distributions are not deductible by the partnership, and may be deductible by the partner under sections 223(a) and 62(a)(19) and are excluded from net earnings from self-employment. HSA contributions treated as guaranteed payments under section 707(c) derived from the partnership’s trade or business and for services rendered to the partnership may be deductible by the partnership, are included in the partner’s gross income, may be deductible by the partner under sections 223(a) and 62(a)(19), and are included in net earnings from self-employment. An S corporation’s contributions to 2-percent shareholder-employee’s HSA for services rendered to the S corporation are treated as section 707(c) guaranteed payments. For employment tax purposes, the 2-percent shareholder-employee is treated as an employee subject to FICA, unless the requirements of section 3121(a)(2)(B) are met.

Announcement 2005–6, page 377. In July 2004, the Service issued a revision to Form 656, Offer in Compromise. The purpose of this announcement is to highlight the addition of a “check-the-box” disclosure authorization (new Item 14), which allows the taxpayer to designate someone to assist him or her while the Service is processing the offer.

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Announcement of Declaratory Judgment Proceedings Under Section 7428 begins on page 380. Announcements of Disbarments and Suspensions begin on page 376. Finding Lists begin on page ii.