SECTION 2. BACKGROUND

On May 4, 2017, the Department of the Treasury (Treasury Department) and the Internal Revenue Service (IRS) released Revenue Procedure 2017–37, 2017–21 I.R.B. 1252, which provided the 2018 inflation adjusted amounts for HSAs as determined under section 223. Under Rev. Proc. 2017–37, the annual limitation on deductions under section 223(b)(2)(B) for an individual with family coverage under an HDHP was $6,900.

Subsequently, statutory amendments by “An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018” (the Act), Pub. L. 115–97, 131 Stat. 2504, enacted December 22, 2017, modified the inflation adjustments for certain provisions of the Internal Revenue Code, including the inflation adjustments under section 223. On March 2, 2018, the Treasury Department and the IRS released Rev. Proc. 2018–18, which superseded Rev. Proc. 2017–37, to reflect the statutory amendments to the inflation adjustments under the Act. Under section 4 of Rev. Proc. 2018–18, the annual limitation on deductions under section 223(b)(2)(B) for an individual with family coverage under an HDHP was $6,850 for 2018 - a $50 reduction from the limitation announced in Rev. Proc. 2017–37. Rev. Proc. 2018–18 did not change any other annual limitation or any other requirement under section 223 for calendar year 2018.

In response to Rev. Proc. 2018–18, stakeholders informed the Treasury Department and the IRS that implementing the $50 reduction to the limitation on deductions for individuals with family coverage would impose numerous unanticipated administrative and financial burdens. Specifically, stakeholders noted that some individuals with

3. Whether the recommendation involves existing regulations or other guidance that is outdated, unnecessary, ineffective, insufficient, or unnecessarily burdensome and that should be modified, streamlined, expanded, replaced, or withdrawn;
4. Whether the recommended guidance would be in accordance with Executive Order 13771, Executive Order 13777 (82 FR 12285), or other executive orders.
5. Whether the recommended guidance promotes sound tax administration;
6. Whether the Service can administer the recommended guidance on a uniform basis; and
7. Whether the recommended guidance can be drafted in a manner that will enable taxpayers to easily understand and apply the guidance.

Since the enactment of the Act, the Treasury Department and the IRS have received a number of letters specifically asking for guidance related to the implementation of provisions in the Act. These suggestions have informed the projects that are currently in development and will also be considered in formulating the 2018–2019 Priority Guidance Plan, as will any additional recommendations for guidance related to the Act.

Please submit recommendations by June 15, 2018, for possible inclusion on the original 2018–2019 Priority Guidance Plan. Taxpayers may, however, submit recommendations for guidance at any time during the year. The Treasury Department and the Service will update the 2018–2019 Priority Guidance Plan periodically to reflect additional guidance that the Treasury Department and the Service intend to publish during the plan year. The periodic updates allow the Treasury Department and the Service to respond to the need for additional guidance that may arise during the plan year.

Taxpayers are not required to submit recommendations for guidance in any particular format. Taxpayers should, however, briefly describe the recommended guidance and explain the need for the guidance. In addition, taxpayers may include an analysis of how the issue should be resolved. For recommendations to modify, streamline, or withdraw existing regulations or other guidance, taxpayers

should explain how the changes would reduce taxpayer cost and/or burden or benefit tax administration. It would be helpful if taxpayers suggesting more than one guidance project prioritize the projects by order of importance. If a large number of projects are being suggested, it would be helpful if the projects were grouped by subject matter and then in terms of high, medium, or low priority. Requests for guidance in the form of petitions for rulemaking will be considered with other recommendations for guidance in accordance with the considerations described in this notice.

Taxpayers may mail comments to:

Internal Revenue Service Attn: CC:PA:LPD:PR (Notice 2018– 43) Room 5203 P.O. Box 7604 Ben Franklin Station Washington, D.C. 20044

or hand deliver comments Monday through Friday between the hours of 8 a.m. and 4 p.m. to:

Courier’s Desk Internal Revenue Service Attn: CC:PA:LPD:PR (Notice 2018–43) 1111 Constitution Avenue, N.W. Washington, D.C. 20224

Alternatively, taxpayers may submit comments electronically via the Federal eRulemaking Portal at www.regulations. gov (type IRS–2018–0010 in the search field on the regulations.gov homepage to find this notice and submit comments). All recommendations for guidance submitted by the public in response to this notice will be available for public inspection and copying in their entirety. For further information regarding this notice, contact Emily M. Lesniak of the Office of the Associate Chief Counsel (Procedure and Administration) at (202) 317-3400 (not a toll-free number).

Rev. Proc. 2018–27