[Federal Register: November 12, 2002 (Volume 67, Number 218)]
[Proposed Rules]
[Page 68539-68540]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12no02-18]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[REG-141832-02]
RIN 1545-BB20
Substantiation of Incidental Expenses
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Notice of proposed rulemaking and notice of proposed rulemaking
by cross-reference to temporary regulations.
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SUMMARY: This document contains proposed amendments to regulations
relating to the requirement to substantiate business expenses for
traveling expenses while away from home. In the Rules and Regulations
section of this issue of the Federal Register, the IRS is issuing
temporary regulations relating to the requirement to substantiate
business expenses for traveling expenses while away from home under
section 274 of the Internal Revenue Code. The text of those regulations
also serves as text for these proposed regulations. This document also
contains proposed regulations amending the regulations under section 62
to conform the cross-reference to the regulations under section 274.
DATES: Written or electronic comments and requests for a public hearing
must be received by February 10, 2003.
ADDRESSES: Send submissions to: CC:ITA:RU (REG-141832-02), Room 5226,
Internal Revenue Service, POB 7604, Ben Franklin Station, Washington,
DC 20044. Submissions may be hand delivered Monday through Friday
between the hours of 8 a.m. and 5 p.m. to: CC:ITA:RU (REG-141832-02),
Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue NW.,
Washington, DC. Alternatively, taxpayers may submit electronic comments
directly to the IRS Internet site at www.irs.gov/regs.
FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations,
John Moriarty, (202) 622-4930; concerning submissions of comments and/
or requests for a public hearing, LaNita Van Dyke, (202) 622-7180 (not
toll-free numbers).
SUPPLEMENTARY INFORMATION:
Background and Explanation of Provisions
Final and temporary regulations in the Rules and Regulations
section of this issue of the Federal Register amend the Income Tax
Regulations (26 CFR part 1) relating to section 274. The temporary
regulations authorize the Commissioner to establish a method under
which a taxpayer may use a specified amount or amounts for incidental
expenses paid or incurred while traveling away from home in lieu of
substantiating the actual cost of incidental expenses. The text of the
temporary regulations also serves, in part, as text for these proposed
regulations. The preamble to the temporary regulations explains the
amendment.
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 is hereby
certified that these regulations will not have a significant economic
impact on a substantial number of small entities. This certification is
based upon the fact that these regulations do not require a collection
of information and do not impose any new or different requirements on
small entities. Therefore, a Regulatory Flexibility Analysis under the
Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required.
Pursuant to section 7805(f) of the Internal Revenue Code, this notice
of proposed rulemaking will be submitted to the Chief Counsel for
Advocacy of the Small Business Administration for comment on their
impact.
Comments and Requests for a Public Hearing
Before these proposed regulations are adopted as final regulations,
consideration will be given to any written (a signed original and eight
copies) or electronic comments that are submitted timely to the IRS.
The IRS and Treasury Department request comments on the clarity of the
proposed rules and how they can be made easier to understand. All
comments will be available for public inspection and copying. A public
hearing will be scheduled if requested in writing by any person that
timely submits written comments. If a public hearing is scheduled,
notice of the date, time, and place for the public hearing will be
published in the Federal Register.
Drafting Information
The principal author of these regulations is John Moriarty, Office
of Associate Chief Counsel (Income Tax & Accounting). However, other
personnel from the IRS and Treasury Department participated in their
development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Proposed Amendments to the Regulations
Accordingly, 26 CFR part 1 is proposed to be amended as follows:
PART 1--INCOME TAXES
1. The authority citation for part 1 continues to read in part as
follows:
Authority: 26 U.S.C. 7805 * * *
Section 1.274-5 also issued under 26 U.S.C. 274(d). * * *
2. Section 1.62-2 is amended by removing the last three sentences
of paragraph (e)(2) and adding two
[[Page 68540]]
sentences in their place to read as follows:
Sec. 1.62-2 Reimbursements and other expense allowance arrangements.
* * * * *
(e) * * *
(2) * * * See Sec. 1.274-5(g) and (j), which grant the
Commissioner the authority to establish optional methods of
substantiating certain expenses. Substantiation of the amount of a
business expense in accordance with rules prescribed pursuant to the
authority granted by Sec. 1.274-5(g) or (j) will be treated as
substantiation of the amount of such expense for purposes of this
section.
* * * * *
3. Section 1.274-5 is amended by:
1. Adding paragraph (j)(3).
2. Adding a new sentence at the end of paragraph (m).
The additions read as follows:
Sec. 1.274-5 Substantiation requirements.
[The text of proposed Sec. 1.274-5(j)(3) and the proposed new
sentence at the end of Sec. 1.274-5(m) are the same as the text of
Sec. 1.274-5T(j)(3) and the last sentence of Sec. 1.274-5T(m)
published elsewhere in this issue of the Federal Register].
Robert E. Wenzel,
Deputy Commissioner of Internal Revenue.
[FR Doc. 02-28544 Filed 11-8-02; 8:45 am]
BILLING CODE 4830-01-P