Part IV. Items — Internal Revenue Bulletin 2011-47

Notice of Proposed Rulemaking by Cross Reference to Temporary Regulation

Deduction for Qualified Film and Television Production Costs

REG–146297–09

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking by cross reference to temporary regulation.

SUMMARY: In this issue of the Bulletin, the IRS is issuing temporary regulations (T.D. 9552) relating to deductions for the costs of producing film and television productions. Those temporary regulations reflect changes to the law made by the Tax Extenders and Alternative Minimum Tax Relief Act of 2008, and affect taxpayers that produce films and television productions within the United States. The text of those temporary regulations also serves as the text of these proposed regulations.

DATES: Written comments and requests for a public hearing must be received by January 17, 2012.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG–146297–09), room 5205, Internal Revenue Service, PO Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to: CC:PA:LPD:PR (REG–146297–09), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue N.W., Washington, DC, or sent electronically via the Federal eRulemaking Portal at www.regulations.gov (IRS REG–146297–09).

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, Bernard P. Harvey, (202) 622–4930; concerning submissions and to request a hearing, Richard.A.Hurst@irscounsel.treas.gov, (202) 622–7180 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Background

Section 181 was added to the Code by section 244 of the American Jobs Creation Act of 2004, Public Law No. 108–357 (118 Stat. 1418) (October 22, 2004), and was modified by section 403(e) of the Gulf Opportunity Zone Act of 2005, Public Law No. 109–135 (119 Stat. 2577) (December 21, 2005). Section 502 of the Tax Extenders and Alternative Minimum Tax Relief Act of 2008, Public Law No. 110–343 (122 Stat. 3765) (October 3, 2008) further modified section 181 for film and television productions commencing after December 31, 2007, and extended section 181 to film and television productions commencing before January 1, 2010. Section 181 was extended again to film and television productions commencing before January 1, 2012, by section 744 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Public Law No. 111–312 (December 17, 2010).

Explanation of Provisions

Temporary regulations in this issue of the Bulletin amend the Income Tax Regulations (26 CFR part 1) to add regulations under section 181 of the Internal Revenue Code. The temporary regulations provide rules specific to film and television productions commencing on or after January 1, 2008, to reflect the Tax Extenders and Alternative Minimum Tax Relief Act of 2008. The text of those temporary regulations also serves as the text of these proposed regulations. The preamble to the temporary regulations explains these proposed regulations.

Special Analyses

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 also has been determined that section 553(b) and (d) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. Because these proposed regulations do not impose a

collection of information on small entities, the Regulatory Flexibility Act (5 U.S.C. Chapter 6) does not apply. Pursuant to section 7805(f) of the Code, this notice of proposed rulemaking has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.

Comments and Requests for a Public Hearing

Before these proposed regulations are adopted as final regulations, consideration will be given to any written comments (a signed original and eight (8) copies) or electronically generated comments that are submitted timely to the IRS. The IRS and the Treasury Department request comments on the clarity of the proposed rule and how it may be made easier to understand. All comments will be available for public inspection and copying. A public hearing may be scheduled if requested in writing by a person who timely submits comments. If a public hearing is scheduled, notice of the date, time, and place for the hearing will be published in the Fed- eral Register .

Drafting Information

The principal author of these regulations is Bernard P. Harvey, Office of Associate Chief Counsel (Income Tax and Accounting). However, other personnel from the IRS and the Treasury Department participated in their development.

- - - -

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 * * * Par. 2. Section 1.181–0 is added as follows:

§1.181–0 Table of contents .

[The text of this proposed amendment to §1.181–0 is the same as the text of

November 21, 2011 795 2011–47 I.R.B.

§1.181–0T published elsewhere in this issue of the Bulletin].

Par . 3. Section 1.181–1 is amended by adding paragraphs (a)(1)(ii), (a)(6), (b)(1)(ii), (b)(2)(vi) and (c)(2) to read as follows:

§1.181–1 Deduction for qualified film and television production costs .

(a) * * * (1) * * * (ii) [The text of this proposed amendment to §1.181–1(a)(1)(ii) is the same as the text for §1.181–1T(a)(1)(ii) published elsewhere in this issue of the Bulletin].

- - - (6) [The text of this proposed amendment to §1.181–1(a)(6) is the same as the text for §1.181–1T(a)(6) published elsewhere in this issue of the Bulletin].
- - - (b) * * * (1) * * * (ii) [The text of this proposed amendment to §1.181–1(b)(1)(ii) is the same as the text for §1.181T(b)(1)(ii) published elsewhere in this issue of the Bulletin].
- - - (2)* - (vi) [The text of this proposed amendment to §1.181–1(b)(2)(vi) is the same as the text for §1.181–1T(b)(2)(vi) published elsewhere in this issue of the Bulletin].

(c) - - (2) [The text of this proposed amendment to §1.181–1(c)(2) is the same as the text for §1.181–1T(c)(2) published elsewhere in this issue of the Bulletin].

Steven T. Miller, Deputy Commissioner for Services and Enforcement.

(Filed by the Office of the Federal Register on October 18, 2011, 8:45 a.m., and published in the issue of the Federal Register for October 19, 2011, 76 F.R. 64879)

Deletions From Cumulative List of Organizations Contributions to Which are Deductible Under Section 170 of the Code

Announcement 2011–72

The Internal Revenue Service has revoked its determination that the organizations listed below qualify as organizations described in sections 501(c)(3) and 170(c)(2) of the Internal Revenue Code of 1986. 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 November 21, 2011, 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, in whole or in part, for the acts or omissions of the organization that were the basis for revocation.

National Heritage Foundation, Inc.

Falls Church, VA