SECTION 1. PURPOSE

The Internal Revenue Service and Treasury Department currently are developing regulations under § 199 of the Internal Revenue Code, enacted as part of the American Jobs Creation Act of 2004, Pub. L. No. 108–357 (the Act), regarding the deduction relating to income attributable to domestic production activities. This notice provides interim guidance on which taxpayers may rely until the regulations are issued. The Service and Treasury Department expect that the regulations will incorporate the rules set forth in this notice and will be effective for taxable years beginning after December 31, 2004, the effective date of § 199. See § 102(e) of the Act. This notice requests comments on the interim guidance provided herein and any additional guidance that should be provided in regulations. Comments must be received by March 31, 2005.