Announcement 2024-42 — Internal Revenue Bulletin 2024-52

The following is a copy of the Competent Authority Arrangement entered into by the competent authorities of the United States of America and the Kingdom of Norway under paragraph 2 of Article 27 (Mutual Agreement Procedure) of the Convention between the United States of America and the Kingdom of Norway for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and Property, signed on December 3, 1971, and as amended by the Protocol signed on September 19, 1980, in which the competent authorities confirm that Article 20 (Investment or Holding Companies) is not applicable to a U.S. investment company that qualifies as a Regulated Investment Company pursuant to sections 851 (Definition of regulated investment company) and 852 (Taxation of regulated investment companies and their shareholders) of the Internal Revenue Code.

The text of the Competent Authority Arrangement is as follows:

COMPETENT AUTHORITY ARRANGEMENT

The Competent Authorities of the United States of America and the Kingdom of Norway hereby enter into the following Compe tent Authority Arrangement (the “ Arrangement ”) under the Convention between the United States of America and the Kingdom of Norway for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and Property, signed on December 3, 1971, and as amended by the Protocol signed on September 19, 1980 (the “ Treaty ”). This Arrangement is entered into under paragraph 2 of Article 27 (Mutual Agreement Procedure) of the Treaty.

Article 20 (Investment or Holding Companies) of the Treaty is not applicable to a U.S. investment company when such company qualifies as a Regulated Investment Company (“RIC”) pursuant to sections 851 (Definition of regulated investment company) and 852 (Taxation of regulated investment companies and their shareholders) of the U.S. Internal Revenue Code, Title 26, Subtitle A, Chapter 1, Subchapter M, Part I, United States Code.

Nothing in this Arrangement restricts the Competent Authorities on the interpretation or application of Article 20 of the Treaty with respect to companies other than RICs.

If, after the Arrangement is signed, there is a substantive amendment to the U.S laws mentioned above, the Arrangement is no longer valid from the effective date of the amendment.

Signed by the undersigned Competent Authorities:

/s/ Trude Steinnes Sønvisen /s/ Holly O. Paz

Trude Steinnes Sønvisen Holly O. Paz Norwegian Competent Authority U.S. Competent Authority

Date: October 29, 2024 Date: November 6, 2024

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by sufficient evidence corroborating the taxpayer’s own statement as to the amount, time and place, business purposes of the expenditure, and the business relationship to the taxpayer of the person receiving the benefit. These substantiation requirements apply to expenses incurred in the use of any listed property, as defined in section 280F(d)(4), which includes any passenger automobile and any other property used as a means of transportation.

In 1985, Congress modified section 274(d) and added section 274(i), creat ing an exception from the substantiation requirements for qualified nonpersonal use vehicles. Public Law 99-44 2, 99 Stat. 77 (1985). Section 274(i) provides that the term “qualified nonpersonal use vehicle” means any vehicle, which by reason of its nature, is not likely to be used more than a de minimis amount for personal purposes.

Both the business and personal use of an employer-provided vehicle that is a qualified nonpersonal use vehicle under section 274(i) qualifies under section 132(d) as a working condition fringe ben efit that is excluded from the employee’s income. Thus, if an employer provides an employee with a qualified nonpersonal use vehicle, the employee does not need to keep records of how the vehicle is used, and the total use of the vehicle is excluded from the employee’s income as a work ing condition fringe benefit under section 132(d). See §§1.132-5(h) and 1.274-5(k). The legislative history to section 274(i) includes examples of qualified nonper sonal use vehicles such as school buses, qualified specialized utility repair trucks, qualified moving vans, clearly marked police and fire vehicles, and unmarked law enforcement vehicles. H.R. Rep. No. 99-67, at 16 (1985) (Conf. Rep.). The leg islative history indicates that Congress intended the IRS and the Treasury Depart ment to expand the list to include other vehicles that, by reason of their nature, are highly unlikely to be used more than a very minimal amount for personal pur poses. H.R. Rep. No. 99-34, at 11 (1985).

Temporary Regulations §1.274-5T(k) and (l) were issued in 1985, identifying categories of qualified nonpersonal use vehicles and providing definitions (by cross reference) of terms such as “auto mobile,” “vehicle,” and “personal use.” TD 8061, 50 FR 46006, 46033, and

Notice of Proposed Rulemaking

Substantiation Requirements and Qualified Nonpersonal Use Vehicles

REG-106595-22

AGENCY : Internal Revenue Service (IRS), Treasury.

ACTION : Notice of proposed rulemak ing.

SUMMARY : This document sets forth proposed regulations relating to the defini tion of qualified nonpersonal use vehicles. Qualified nonpersonal use vehicles are excepted from the substantiation require ments that apply to certain listed property. These proposed regulations add unmarked vehicles used by firefighters or members of a rescue squad or ambulance crew as a new type of qualified nonpersonal use vehicle. These regulations affect govern mental units that provide firefighter or rescue squad or ambulance crew member employees with unmarked qualified non personal use vehicles and the employees who use those vehicles.

DATES : Written or electronic comments and requests for a public hearing must be received by March 3, 2025.

ADDRESSES : Commenters are strongly encouraged to submit public comments electronically via the Federal eRulemak ing Portal at http://www.regulations.gov (indicate IRS and REG-106595-22) by following the online instructions for sub mitting comments. Requests for a public hearing must be submitted as prescribed in the “Comments and Requests for a Public Hearing” section. Once submitted to the Federal Rulemaking Portal, com ments cannot be edited or withdrawn. The Department of the Treasury (Treasury Department) and the IRS will publish for public availability any comment submit ted electronically or on paper, to the IRS’s public docket. Send paper submissions to CC:PA:01:PR (REG-106595-22), Room

5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044.

FOR FURTHER INFORMATION CONTACT : Concerning the proposed regulations, Stephanie Caden at (202) 317-4774; concerning submissions of comments or requests for a public hearing, the Publications and Regulations section by email at publichearings@irs.gov (pre ferred) or (202) 317-6901 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Authority

This notice of proposed rulemaking contains proposed regulations issued under the authority granted to the Secre tary of the Treasury or her delegate (Sec retary) by sections 274(p) and 132(o) of the Internal Revenue Code (Code) that would amend the Income Tax Regulations (26 CFR part 1) under sections 274(i) and 132(d) related to qualified nonpersonal use vehicles. Section 274(p) provides the Secretary with an express grant of regula tory authority with respect to section 274 as the Secretary may deem necessary to carry out the purposes of that section. Sec tion 132(o) provides the Secretary with an express grant of regulatory authority with respect to section 132 to prescribe such regulations as may be necessary or appro priate to carry out the purposes of that sec tion. In addition, section 7805(a) autho rizes the Secretary to prescribe all needful rules and regulations for the enforcement of the Code.

Background

In general, section 274 limits or disal lows deductions for certain expenditures that otherwise would be allowable under chapter 1 of the Code, primarily under section 162(a), which allows a deduction for ordinary and necessary expenses paid or incurred during the taxable year in car rying on any trade or business.

Section 274(d), as relevant to these proposed regulations, provides that a tax payer is not allowed a deduction or credit for certain expenses unless the expenses are substantiated by adequate records or

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Police and fire vehicles that are clearly marked and law enforcement vehi cles that are unmarked were included as categories of qualified nonpersonal use vehicles. However, clearly marked vehi cles provided to Federal, State, and local government workers who respond to emergency situations as public safety offi cers but who are not employed by either a fire department or police department were not included as qualified nonpersonal use vehicles.

In 2008, proposed regulations were issued to incorporate the text of §1.2745T(k) and add clearly marked public safety officer vehicles as a new type of qualified nonpersonal use vehicle. 73 FR 32500. An example illustrating the appli cation of the rules to a clearly marked public safety officer vehicle was included at §1.274-5(k)(8) as Example 3 .

In 2010, final regulations were pub lished adding clearly marked public safety officer vehicles to the list of qualified non personal use vehicles. TD 9483, 75 FR 27934 (current regulations). As a result, emergency responders who are provided a clearly marked vehicle receive the same tax treatment whether they work for the police department, fire department, or other governmental unit, or any agency or instrumentality thereof.

Explanation of Provisions

The Treasury Department and the IRS have become aware that certain emer gency responders not covered by the cur rent regulations are provided unmarked vehicles by a governmental unit or an agency or instrumentality thereof (govern mental unit). In particular, stakeholders have commented that fire chiefs or mem bers of rescue squads or ambulance crews who, when not on a regular shift, need to be on call at all times to respond to emer gencies will often be assigned unmarked command vehicles to travel safely and quickly to a scene and perform emer gency services. While the authorized use of unmarked vehicles by law enforcement officers employed on a full-time basis by a governmental unit that is responsible for the prevention or investigation of crime involving injury to persons or property (including apprehension or detention of persons for such crimes) satisfies the cur

rent regulations governing qualified non personal use vehicles, the use of unmarked vehicles provided to firefighters or mem bers of a rescue squad or ambulance crew does not satisfy the current regulations.

Section 274(i) defines a qualified non personal use vehicle as one which, by rea son of its nature, “is not likely to be used more than a de minimis amount for per sonal purposes.” The current regulations define qualified nonpersonal use vehicles to include clearly marked police, fire, or public safety officer vehicles that are owned or leased by a governmental unit and required to be used for commuting by a police officer, firefighter, or public safety officer (as defined in section 402(l) (4)(C)) who, when not on a regular shift, is on call at all times. Any personal use (other than commuting) of the vehicle out side the limit of the police officer’s arrest powers or the firefighter’s or public safety officer’s obligation to respond to an emer gency must be prohibited by the govern mental unit. See §1.274-5(k)(2)(ii)(A) and (k)(3). The various examples included in §1.274-5(k)(8) illustrate that a prohibition on personal use (other than commuting) is intended to exist in situations where both commuting and only de minimis personal use, such as personal errands, are permit ted.

The current regulations also define qualified nonpersonal use vehicles as including unmarked law enforcement vehicles owned or leased by Federal, State, county, or local governmental agen cies or departments that officially autho rize the business and personal use of the vehicle by law enforcement officers whom they employ, provided any personal use is incidental to law enforcement functions. See §1.274-5(k)(2)(ii)(R) and (k)(6). The regulations define law enforcement offi cers as individuals who are employed on a full-time basis by a governmental unit that is responsible for the prevention or inves tigation of crime involving injury to per sons or property (including apprehension or detention of persons for those crimes), who are authorized by law to carry fire arms, execute search warrants, and to make arrests (other than merely a citizen’s arrest), and who regularly carry firearms (except when it is not possible to do so because of the requirements of undercover work). See §1.274-5(k)(6)(ii). Unmarked

law enforcement vehicles allow law enforcement officers to operate inconspic uously, e.g., so that they can conduct these duties while performing undercover work.

Historically, firefighters and rescue squad and ambulance crew members were provided with vehicles that had mark ings to indicate their status as emergency response vehicles. More recently, the IRS and Treasury Department have become aware that some governmental units are assigning these emergency responders unmarked vehicles due to increased inci dents of harassment of first responders and vandalism of clearly marked fire and emergency vehicles and equipment.

Generally, fire and emergency response departments retain the title to the unmarked vehicles and maintain pol icies that limit the use of the vehicles for personal, non-work purposes. Because firefighters and members of a rescue squad or ambulance crew respond to a wide variety of emergencies at all hours, including fires, medical crises, vehicular accidents, natural disasters, and terrorist attacks, these vehicles typically are spe cially equipped to allow firefighters and members of rescue squads or ambulance crews who, even when not on a regular shift, are on call at all times to travel safely and efficiently to the scene of an emer gency and provide emergency services. Onboard equipment may include lights and sirens, medical emergency equip ment, life-saving devices such as defibril lators, and radios that assist firefighters, rescue squads, or ambulance crews in communicating with a central source and other emergency response crews related, for example, to traffic or hospital capac ity. Onboard equipment may also include items such as personal protective equip ment (helmet, coat, boots), emergency oxygen tanks, reference books, and lap top computers that enable workers to access important information related to the emergency. Under the current regu lations, emergency responders must sub stantiate all of the time they spend using these unmarked vehicles for work related purposes, and the value of any personal use of these vehicles, even if minimal, must be included in the employees’ tax able income.

Unmarked fiirefighter and rescue squad or ambulance crew vehicles are

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less likely to be utilized in undercover work than unmarked law enforcement vehicles. However, the use of unmarked vehicles allows firefighters and other emergency personnel who commute and are required to be on call at all times, even when not on a regular shift, to travel inconspicuously, thereby reducing risk of harassment and vandalism. Also, as described above, unmarked firefighter and rescue squad or ambulance crew vehicles typically are specially outfit ted with onboard equipment, which is used by firefighters and emergency per sonnel to suppress fires, conduct rescue activities, or provide emergency medi cal services as part of an official emer gency response system. Because these vehicles are generally specially outfitted with such equipment, any personal use of these vehicles is likely to be minimal. Thus, adding unmarked firefighter, res cue squad or ambulance crew vehicles as a new category of qualified nonpersonal use vehicle is consistent with the under lying intent of section 274(i).

Accordingly, the proposed regulations would amend §1.274-5(k)(2)(ii) to add unmarked vehicles used by firefighters, members of rescue squads, or ambulance crews to the list of qualified nonpersonal use vehicles that are exempt from the substantiation requirements of section 274(d). In addition, the proposed regula tions would amend §1.274-5(k) to add a new §1.274-5(k)(7) providing definitions for the terms “unmarked firefighter, rescue squad or ambulance crew vehicles”, “fire fighter,” and “member of a rescue squad or ambulance crew,” and add §1.274-5(k) (9)(v) ( Example 5 ) illustrating the new provision.

The proposed regulations provide that the substantiation requirements of sec tion 274(d) do not apply to an unmarked firefighter, rescue squad, or ambulance crew vehicle that is required to be used for commuting by the firefighter or mem ber of a rescue squad or ambulance crew, who, when not on a regular shift, is on call at all times. Because any personal use of an unmarked firefighter, rescue squad, or ambulance crew vehicle should be min imal and incidental to its main purpose in providing emergency services, the proposed regulations also provide that personal use of the vehicle, other than

commuting and personal errands, that is outside the firefighter’s or rescue squad or ambulance crew member’s obligation to respond to an emergency must be prohib ited by the governmental unit that owns or leases the vehicle and employs the fire fighter or rescue squad or ambulance crew member.

The proposed regulations define an “unmarked firefighter, rescue squad, or ambulance crew vehicle” as a vehicle, that is owned or leased by a governmen tal unit, or any agency or instrumentality thereof, and that is specially outfitted to allow firefighters or members of rescue squads and ambulance crews to travel safely and efficiently to the scene of an emergency and provide emergency ser vices. The description of the types of special equipment found in the unmarked vehicles is derived from information pro vided by stakeholders requesting updates to the current regulations. The proposed regulations also provide that a license plate marking or insignia do not disqual ify a vehicle from being an unmarked firefighter, rescue squad, or ambulance crew vehicle.

The definition of “firefighter” for pur poses of these proposed regulations, is modeled in part on the definition of “law enforcement officer” in §1.274-5(k)(6) (ii) and draws from relevant language in the Public Safety Officers’ Benefits Act (PSOB Act)’s definition of “action outside of jurisdiction” in 34 U.S.C. 10284(1)(C), as well as from outside sources. The defi nition of “member of a rescue squad or ambulance crew” in these proposed reg ulations is the same definition that is set forth in 34 U.S.C. 10284(10), which was enacted as an amendment to the PSOB Act that establishes a framework for the expeditious and fair processing of claims brought by disabled law enforcement offi cers, firefighters, and other first respond ers or their survivors. H. Rep. No. 112548 (2012). These proposed regulations provide an example of circumstances in which a member of a rescue squad or ambulance crew assigned an unmarked vehicle would qualify for the exclusion under this new provision.

Finally, these proposed regulations pro vide conforming amendments to §§1.1321(g) and 1.132-5(h)(1).

The purpose of these proposed reg ulations is to ensure that firefighters and members of rescue squads and ambulance crews who are officially authorized to use specially equipped unmarked vehicles to respond to emergencies are accorded the same tax treatment as other first respond ers who use qualified nonpersonal use vehicles. The Treasury Department and the IRS request comments on whether the definitions of “unmarked firefighter, res cue squad or ambulance crew vehicles,” “firefighter,” and “member of a rescue squad or ambulance crew,” are sufficient to accomplish the intended purpose of these proposed regulations or whether any of them might lead to potential abuse.

Applicability Date

Proposed §1.274-5(k)(2)(ii)(S), (k) (7), (k)(9)(v) and references to §1.2745(k)(9) in §1.132-5(h) are proposed to apply to tax years beginning on or after the date of publication of final regula tions in the Federal Register . Until the date of publication of final regulations in the Federal Register, for purposes of proposed §1.274-5(k)(2)(ii)(S), (k)(7), (k)(9)(v) and references to §1.274-5(k) (9) in §1.132-5(h), taxpayers may rely on the guidance provided in these proposed regulations.

Special Analyses

I. Regulatory Planning and Review— Economic Analysis

Pursuant to the Memorandum of Agreement, Review of Treasury Regula tions under Executive Order 12866 (June 9, 2023), tax regulatory actions issued by the IRS are not subject to the requirements of section 6 of Executive Order 12866, as amended. Therefore, a regulatory impact assessment is not required.

II. Paperwork Reduction Act

This proposed regulation does not create new collection requirements, as defined under the Paperwork Reduction Act (44 U.S.C. 35); and does not alter any previously approved Office of Manage ment and Budget information collection requirements and their associated burden.

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PART 1—INCOME TAXES

Paragraph 1. The authority citation for part 1 is amended by revising the entries for §§1.132-0 through 1.132-8T and §1.274-5 to read in part as follows:

Authority : 26 U.S.C. 7805 * * *

Sections 1.132-0 through 1.132-8T also issued under 26 U.S.C. 132(o).

Section 1.274-5 also issued under 26 U.S.C. 274(p).

Par. 2. Section 1.132-1 is amended by adding a sentence to the end of paragraph (g) to read as follows:

§1.132-1 Exclusion from gross income for certain fringe benefits.

(g) * * * In addition, references to §1.274-5(k)(9) in §1.132-5(h) are applica ble as of [date of publication of final regu lations in the Federal Register ].

Par. 3. Section 1.132-5 is amended by revising paragraph (h)(1) to read as fol lows:

§1.132-5 Working condition fringes.

(h) * * * (1) In general . Except as pro vided in paragraph (h)(2) of this section, 100 percent of the value of the use of a qual ified nonpersonal use vehicle (as described in §1.274-5(k)) is excluded from gross income as a working condition fringe, pro vided that, in the case of a vehicle described in §1.274-5(k)(3) through (9), the use of the vehicle conforms to the requirements of §1.274-5(k)(3) through (9).

Par. 4. Section 1.274-5 is amended by:

Redesignating paragraph (k)(2)(ii) (S) as paragraph (k)(2)(ii)(T) and adding new paragraph (k)(2)(ii)(S);
Redesignating paragraph (k)(8) as paragraph (k)(9);
Redesignating paragraph (k)(7) as new paragraph (k)(8) and adding new paragraph (k)(7);
In newly redesignated paragraph (k) (9), designating Examples 1 through 4 as paragraphs (k)(9)(i) through (k)(9)(iv), respectively.

III. Regulatory Flexibility Act

It is hereby certified that these proposed regulations will not have a significant eco nomic impact on a substantial number of small entities pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6). This certification is based on the fact that these proposed regulations do not impose any new or different requirements on small entities. The proposed regulations would apply only to employers that utilize unmarked fire fighter, rescue squad, or ambulance vehicles and therefore would affect a relatively small number of entities, most of which would be public entities. In addition, these proposed regulations would not affect employment tax reporting or require any additional sub stantiation. Rather, the proposed regulations exempt affected entities from substantiation requirements and for this reason do not add any economic burden to affected entities. Therefore, a Regulatory Flexibility Analy sis under the Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required.

IV. Section 7805(f)

Pursuant to section 7805(f), this notice of proposed rulemaking has been submitted to the Chief Council for the Office of Advocacy of the Small Business Administration for comment on its impact on small business.

V. Unfunded Mandates Reform Act

Section 202 of the Unfunded Mandates Reform Act of 1995 requires that agencies assess anticipated costs and benefits and take certain other actions before issuing a final rule that includes any Federal mandate that may result in expenditures in any one year by a State, local, or Tribal government, in the aggregate, or by the private sector, of $100 million in 1995 dollars, updated annually for inflation. These proposed regu lations do not include any Federal mandate that may result in expenditures by State, local, or Tribal governments, or by the pri vate sector, in excess of that threshold.

VI. Executive Order 13132: Federalism

Executive Order 13132 (Federalism) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial, direct

compliance costs on State and local gov ernments, and is not required by statute, or preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive order. These proposed regulations do not have federal ism implications, do not impose substantial direct compliance costs on State and local governments, and do not preempt State law within the meaning of the Executive order.

Comments and Request for a Public Hearing

Before final regulations regarding the definition of qualified nonpersonal use vehicles are adopted, consideration will be given to any written or electronic com ments on these proposed amendments that are submitted timely (in the manner described under the ADDRESSES head ing) to the IRS. The Treasury Department and the IRS request comments on all aspects of the proposed regulations. Any electronic or paper comments submitted, will be made available at https://www.reg ulations.gov or upon request.

A public hearing will be scheduled if requested in writing by any person who timely submits electronic or written com ments. Requests for a hearing are strongly encouraged to be submitted electronically. If a public hearing is scheduled, notice of the date and time for the public hearing will be published in the Federal Register .

Drafting Information

The principal author of these regula tions is Stephanie L. Caden of the Office of the Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). However, other per sonnel from the Treasury Department and the IRS participated in their development.

List of Subjects in 26 CFR Part 1

Income taxes, Reporting and record keeping requirements.

Proposed Amendments to the Regulations

Accordingly, the Treasury Department and IRS propose to amend 26 CFR part 1 as follows:

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Adding paragraph (k)(9)(v); and
Revising paragraph (m). The additions read as follows:

§1.274-5 Substantiation requirements.

(k) * * * (2) * * * (ii) * * * (S) Unmarked firefighter, rescue squad, or ambulance crew vehicles (as defined in paragraph (k)(7) of this section).

(7) Unmarked firefighter, rescue squad, or ambulance crew vehicles —(i) In gen- eral . The substantiation requirements of section 274(d) and this section do not apply to an unmarked firefighter, res cue squad, or ambulance crew vehicle required to be used for commuting by the firefighter or member of a rescue squad or ambulance crew, who, when not on a regular shift, is on call at all times. Per sonal use (other than commuting) of the vehicle outside the firefighter’s or rescue squad or ambulance crew member’s obli gation to respond to an emergency must be prohibited by the governmental unit, or any agency or instrumentality thereof, that owns or leases the vehicle and employs the firefighter, rescue squad, or ambulance crew member.

(ii) Unmarked firefighter, rescue squad, or ambulance crew vehicle defined . An unmarked firefighter, rescue squad, or ambulance crew vehicle is an unmarked vehicle used by a firefighter, or member of a rescue squad or ambulance crew, that is owned or leased by a governmental unit, or any agency or instrumentality thereof, and that is specially outfitted to allow firefighters or members of rescue squads and ambulance crews to travel safely and

efficiently to the scene of an emergency and provide emergency services. Onboard equipment on the vehicles includes but is not limited to lights and sirens, medical emergency equipment, life-saving devices such as defibrillators, and radios that assist firefighters, rescue squads, or ambulance crews in communicating with a central source or other emergency response crews related, for example, to traffic or hospital capacity. Onboard equipment may also include items such as personal protective equipment (helmet, coat, boots), emer gency oxygen tanks, reference books, and laptop computers that enable workers to access important information related to the emergency. A license plate marking or insignia does not disqualify a vehicle from being an unmarked firefighter, res cue squad, or ambulance crew vehicle for purposes of this paragraph (k)(7).

(iii) Firefighter . The term firefighter means an individual who is employed by a governmental unit, or any agency or instrumentality thereof, that is responsi ble for firefighting, rescue activity, or the provision of emergency medical care, and other related emergency services to pre vent injury to persons or property and has the official authority to engage in fire sup pression and provide related emergency services.

(iv) Member of a rescue squad or ambulance crew . For purposes of this paragraph (k)(7), the term member of a rescue squad or ambulance crew has the same meaning as in 34 U.S.C. 10284(10).

(9) * * * (v) Example 5 . Emergency medical technician, X, is a member of a rescue squad employed by City M. X is provided with an unmarked vehicle (equipped with sirens and medical equipment) for use in

responding to emergencies. X, along with other members of the rescue squad, is ordinarily on duty for a regular shift, and on call during the other hours of the day. X is required to use the unmarked rescue squad vehicle to commute to X’s home in City M. The rescue squad’s official policy regarding unmarked rescue squad vehicles prohibits personal use (other than com muting) of the vehicles outside the city limits. When not using the vehicle on the job, X uses the vehicle only for commut ing, personal errands on the way between work and home, and personal errands within City M. All use of the vehicle by X conforms to the requirements of paragraph (k)(7) of this section. Therefore, the value of that use is excluded from X’s gross income as a working condition fringe and the vehicle is not subject to the substantia tion requirements of section 274(d).

(m) Applicability date . This section applies to expenses paid or incurred after December 31, 1997. However, paragraph (j)(3) of this section applies to expenses paid or incurred after September 30, 2002, and paragraph (k) of this section applies to clearly marked public safety officer vehicles, as defined in paragraph (k)(3) of this section, only with respect to uses occurring after May 19, 2010. The rules of paragraphs (k)(2)(ii)(S), (k)(7) and (k)(9) (v) of this section apply to taxable years ending on or after [date of publication of final regulations in the Federal Register ].

Douglas W. O’Donnell,

Deputy Commissioner .

(Filed by the Office of the Federal Register Decem ber 2, 2024, 8:45 a.m., and published in the issue of the Federal Register for December 3, 2024, 89 FR 95727).

December 23, 2024 1448 Bulletin No. 2024–52