SECTION 1. PURPOSE

This revenue procedure updates Rev. Proc. 2012–51, 2012–51 I.R.B. 719 and identifies circumstances under which the disclosure on a taxpayer’s income tax return with respect to an item or position is adequate for the purpose of reducing the understatement of income tax under section 6662(d) of the Internal Revenue Code (relating to the substantial understatement aspect of the accuracy-related penalty), and for the purpose of avoiding the tax return preparer penalty under section 6694(a) (relating to understatements due to unreasonable positions) with respect to income tax returns. This revenue procedure does not apply with respect to any other penalty provisions, including any other provision of the section 6662 accuracy-related penalty. If this revenue procedure does not include an item, disclosure is adequate with respect to that item only if made on a properly completed Form 8275 or 8275–R, as appropriate, attached to the return for the year or to a qualified amended return.

This revenue procedure applies to any income-tax return filed on 2013 tax forms for a taxable year beginning in 2013, and to any income-tax return filed in 2014 on 2013 tax forms for short taxable years beginning in 2014.