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Part 32. Published Guidance and Other Guidance to Taxpayers

Chapter 2. Chief Counsel Publication Handbook

Section 3. Drafting Published Guidance (Cont. 1)

32.2.3  Drafting Published Guidance (Cont. 1)

32.2.3.5 
Components of Revenue Rulings, Revenue Procedures, Notices, Announcements, and News Releases

32.2.3.5.1 
Revenue Rulings

32.2.3.5.1.2 
Headings

32.2.3.5.1.2.8  (08-11-2004)
Public Comments

  1. If the revenue ruling solicits public comments include a section, entitled "Comments." The section should include instructions for submitting comments including the appropriate mailing address.

32.2.3.5.1.2.9  (08-11-2004)
Drafting Information

  1. A paragraph relating to drafting information, including the name of the drafting attorney, is included in drafts of proposed revenue rulings. The name of the drafting office may be substituted for the drafting attorney if appropriate. This section must contain some point of contact for further inquiries.

32.2.3.5.2  (08-11-2004)
Revenue Procedures

  1. The body of a revenue procedure may include a table of contents, an appendix, and some of the components listed below (or others) as needed.

  2. A revenue procedure that discusses the contents of an internal management document should include only as much of the internal management document or communication as is necessary for an understanding of the procedure.

  3. Certain revenue procedures, such as those providing instructions concerning the requirements for obtaining a letter ruling or technical advice, are updated annually. See Rev. Proc. 2003-1, 2003-1 I.R.B. 1, and Rev. Proc. 2003-2, 2003-1 I.R.B. 76, (or any successors).

  4. Certain procedures pertaining to particular taxes are set forth in the substantive provisions of the statutes and regulations. Other procedural rules with respect to taxes administered by the Service are set forth in the Statement of Procedural Rules, 26 C.F.R. § 601.

32.2.3.5.2.1  (08-11-2004)
Headings

  1. HEADINGS are used in revenue procedures to identify the following components, as needed.

    • PURPOSE

    • CHANGES

    • BACKGROUND

    • SCOPE

    • PROCEDURE (or APPLICATION)

    • EFFECT ON OTHER REVENUE PROCEDURES (or DOCUMENTS)

    • EFFECTIVE DATE

    • PAPERWORK REDUCTION ACT

    • DRAFTING INFORMATION

  2. A numbering system is used in combination with the headings in revenue procedures. The word "SECTION" is typed in capital letters beginning at the left margin for the heading of the first section, followed in order by a space, the figure 1, a period, a space and the heading typed in capitals (no period at the end of the heading). The word " SECTION" is used for all subsequent sections (and in the table of contents, if applicable). If a section contains more than one paragraph, it may be divided further into subsections, paragraphs, subparagraphs, Divisions, and subdivisions, which are assigned numerical or alphabetical designations (and may be assigned subheadings), as illustrated in Exhibit 32.2.3-4. The subsection designation is indented five spaces from the margin, and each successive division is indented three spaces further, as shown below:

    Example:

    (Left margin)
      SECTION 1, 2, 3, etc.;
        .01, .02, etc. (subsections);
          (1), (2), etc. (paragraphs);
            (a), (b), etc. (subparagraphs);
              (i), (ii), etc. (divisions);
                and (A), (B), etc. (subdivisions).

  3. If a particular revenue procedure does not lend itself to this format, the headings may be omitted altogether and the text presented in narrative form. (Example: Rev. Proc. 77–27, 1977–2 C.B. 537.)

32.2.3.5.2.1.1  (08-11-2004)
Purpose

  1. The purpose of the revenue procedure should be clearly and directly stated. For example, "This revenue procedure provides ... . "

32.2.3.5.2.1.2  (08-11-2004)
Changes

  1. When a revenue procedure changes a prior revenue procedure, a clear explanation of the significant change(s) must be stated in the CHANGES section of the new revenue procedure. Reference should be made to each affected section of the earlier revenue procedure describing each significant change and the reason for it.

32.2.3.5.2.1.3  (08-11-2004)
Background

  1. The BACKGROUND section explains the need for the revenue procedure. In addition, a discussion of the relevant Internal Revenue Code sections, regulations, and prior revenue procedures and revenue rulings that helped form a basis for the revenue procedure should be included in the BACKGROUND section.

32.2.3.5.2.1.4  (08-11-2004)
Scope

  1. The SCOPE section sets forth the extent of the application of the revenue procedure. If the revenue procedure does not apply to a particular situation the SCOPE section should so state.

32.2.3.5.2.1.5  (08-11-2004)
Procedure (or Application)

  1. The PROCEDURE (OR APPLICATION) section sets forth in concise language the various steps or requirements that are necessary to accomplish the purpose of the revenue procedure. It may be advantageous to use more than one section with appropriate subheadings that describe the different situations covered by the revenue procedure.

32.2.3.5.2.1.6  (08-11-2004)
Effect on Other Revenue Procedures (or Documents)

  1. The same rules apply to revenue procedures as to revenue rulings.

  2. If another publication is affected (that is, amplified, clarified, distinguished, modified, obsoleted, revoked, superseded, supplemented, or suspended, as those terms are described in CCDM 32.2.2.8.1) by the new revenue procedure, that fact must be stated. The extent of the change should be stated precisely; it is not sufficient to state that a prior revenue procedure is modified "to the extent that it is inconsistent herewith."

  3. If the effect on a prior publication is described in another section of the new revenue procedure (for example, when a prior revenue procedure is superseded and the significant changes are described in the CHANGES section of the new revenue procedure), a statement that "Rev. Proc. xx-xxx is superseded" must also be included in the EFFECT ON OTHER REVENUE PROCEDURES (or DOCUMENTS) section of the new procedure. This statement in the EFFECT ON OTHER REVENUE PROCEDURES (or DOCUMENTS) section is necessary both to ensure clarity and to aid in updating finding lists and citators.

  4. A revenue procedure may affect a prior publication in more than one way. For example, it may amplify and supersede, clarify and supersede, or modify and supersede, etc. (In such cases both terms are used in the EFFECT ON OTHER REVENUE PROCEDURES (or DOCUMENTS) section. (Illustration: " Rev. Proc. xx-xxx is modified and superseded." )

32.2.3.5.2.1.7  (08-11-2004)
Effective Date

  1. Revenue procedures usually contain an EFFECTIVE DATE heading and provision.

  2. Ordinarily, the effective date of a revenue procedure is either the date of publication or a later date when appropriate. In some cases, however, it is appropriate to state the effective date of a revenue procedure in other terms, including in terms of periods beginning before publication of the revenue procedure, events occurring after the beginning of the year in which a revenue procedure is published, or requests submitted after the beginning of the calendar year in which a revenue procedure is published. See Exhibit 32.2.3-9 for sample effective date provisions.

  3. When the effective date is intended to be concurrent with publication, the effective date should be the date of the IRB in which the revenue procedure is published, or if the revenue procedure is released to the tax services in advance of its publication in the IRB, the effective date should be the date of the release. See Exhibit 32.2.3-9. Do not state that the revenue procedure is effective "immediately."

  4. Prospective application of revenue procedures does not require coding and cross-referencing to section 7805(b)(8).

32.2.3.5.2.1.8  (08-11-2004)
Paperwork Reduction Act

  1. The Paperwork Reduction Act (PRA) requires federal agencies to obtain OMB approval before any collection of information may be enforced. The Paperwork Reduction Act potentially applies to revenue rulings, revenue procedures, notices, and announcements.

  2. In general, the term "collection of information" means a reporting, recordkeeping, or disclosure requirement that is imposed on ten or more persons. It does not matter whether the requirement is voluntary or mandatory or if the requirement is imposed by statute. See 5 C.F.R. § 1320.3(c).

  3. The term "reporting requirement" means a requirement that persons provide information to an entity of the Federal government. For example, a publication that requires a separate statement to be attached to a tax return imposes a paperwork burden subject to the PRA. However, a publication that requires a form to be filed does not impose a paperwork requirement subject to the PRA because the form, and not the publication, is the " instrument of collection" that is subject to the PRA.

  4. The term "recordkeeping requirement" means that persons must maintain specified records, whether or not an entity of the federal government or any other person actually seeks access to the records or is provided such records. See 5 C.F.R. § 1320.3(m). (This mandate to maintain specified records is a requirement in addition to the general books and records requirement of section 6001.) Thus, because a recordkeeping requirement is one that requires specified records, a publication that does not require that particular records be maintained, but nonetheless prompts some taxpayer to maintain records consistent with the provisions of section 6001, does not impose a recordkeeping requirement.

  5. The term "disclosure requirement" means that a person must disclose information to third parties, the Federal government, or to the public at large.

  6. See Exhibit 32.2.3-10 for model language to use in proposed publications concerning the Paperwork Reduction Act.

  7. If a revenue procedure contains a collection of information requirement, the drafting attorney must complete OMB Form 83-I, Paperwork Reduction Act Submission, and a Supporting Statement. See Exhibits 32.1.2-4 and 32.1.2-6. As soon as a final decision is made with respect to a revenue procedure’s collection of information requirements, the drafting attorney must provide the Paperwork Reduction Act contact person with:

    • OMB Form 83-I,

    • Supporting Statement,

    • Copy of the revenue procedure, and

    • Copy of the underlying statute.

  8. For instructions for completing OMB Form 83-I see Exhibit 32.1.2-5. The drafting attorney should submit hard copies of these documents and send an email attaching any electronic versions. The drafting attorney should contact the Paperwork Reduction Act contact person for questions regarding OMB Form 83-I or Supporting Statement.

32.2.3.5.2.1.9  (08-11-2004)
Public Comments

  1. See CCDM 32.2.3.5.1.2.8.

32.2.3.5.2.1.10  (08-11-2004)
Drafting Information

  1. See CCDM 32.2.3.5.1.2.9.

32.2.3.5.2.1.11  (08-11-2004)
Table of Contents and Appendices

  1. A table of contents and appendices can be used to organize a very lengthy revenue procedure or revenue ruling. For examples of table of contents and appendices see Rev. Proc. 2003-1 (or any successors).

32.2.3.5.3  (08-11-2004)
Notices

  1. Notices are used to publicly announce guidance that may involve substantive interpretations of the Internal Revenue Code or other provisions of the law. See CCDM 32.2.2.3.3.

32.2.3.5.3.1  (08-11-2004)
Components of Notices

  1. The components for a notice are reflected in Exhibit 32.2.3-5. Note the following points:

    1. A brief title, describing the subject matter of the notice, is typed below "Part III — Administrative, Procedural, and Miscellaneous."

    2. The word "Notice" followed by the current year designation, is typed below the descriptive title.

    3. Headings should be used in notices when helpful.

  2. Notices have effective dates similar to revenue procedures. See Exhibit 32.2.3-9 for sample effective date provisions.

32.2.3.5.3.2  (08-11-2004)
Paperwork Reduction Act

  1. See CCDM 32.2.3.5.2.1.8.

32.2.3.5.3.3  (08-11-2004)
Public Comments

  1. See CCDM 32.2.3.5.1.2.8.

32.2.3.5.4  (08-11-2004)
Announcements

  1. Announcements are used to publicly announce guidance of an immediate or short-term value and to publish advance notices of proposed rulemaking in the IRB. See CCDM 32.2.2.3.4.

32.2.3.5.4.1  (08-11-2004)
Components of Announcements

  1. The components for an announcement are reflected in Exhibit 32.2.3-6. Note the following points:

    1. A brief title, describing the subject matter of the announcement, is typed below "Part IV—Items of General Interest."

    2. The word "Announcement" followed by the current year designation, is typed below the descriptive heading.

    3. Announcements that originate from identifiable printed matter should be footnoted to indicate their source.

    4. Like revenue rulings (and unlike news releases), announcements speak from the perspective of the Service (that is, in the first person). Therefore, announcements should not contain language like "The IRS today announced" - this language speaks from the perspective of a third party.

  2. Announcements have effective dates similar to revenue procedures. See Exhibit 32.2.3-9 for sample effective date provisions.

32.2.3.5.4.2  (08-11-2004)
Paperwork Reduction Act

  1. See CCDM 32.2.3.5.2.1.8.

32.2.3.5.4.3  (08-11-2004)
Public Comments

  1. See CCDM 32.2.3.5.1.2.8.

32.2.3.5.5  (08-11-2004)
News Releases

  1. Unlike other publications, news releases speak from the perspective of a third party. News releases are used to:

    • Announce hearings

    • Solicit comments

    • Inform the public of a change in procedures

    • Inform the public of a change in address

  2. News releases are nontechnical publications targeted at the nonpractitioner taxpayer public. Technical discussions must be kept to a minimum and material such as Internal Revenue Code section numbers should be avoided if possible and, when used, relegated to the end of the release.

  3. The components for a news release are shown in Exhibit 32.2.3-7. A news release does not contain a paragraph relating to drafting information.

Exhibit 32.2.3-1  (08-11-2004)
Explanation of the Parts of the Internal Revenue Bulletin

A. The Bulletin is divided into four parts as follows:

Part I.- 1986 Code

This part includes rulings and decisions based on provisions of the Internal Revenue Code of 1986.

Part II.- Treaties and Tax Legislation

This part is divided into two subparts as follows: Subpart A, Tax Conventions and Other Related Items, and Subpart B, Legislation and Related Committee Reports.

Part Ill.- Administrative, Procedural, and Miscellaneous

To the extent practicable, pertinent cross references to these subjects are contained in the other Parts and Subparts. Also included in this part are Bankruptcy Secrecy Act Administrative Rulings, which are issued by the department of the Treasury’s Office of the Assistant Secretary (Enforcement).

Part IV.- Items of General Interest

This part includes notices of proposed rulemaking, disbarment and suspension lists, and announcements.

The first Bulletin for each month includes a cumulative index for the matters published during the preceding months. These monthly indexes are cumulated on a semi-annual basis, and are published in the first Bulletin of the succeeding semiannual period respectively.

B. The Bulletin Index-Digest System (BIDS), a research and reference service supplementing the Bulletin, consists of four services: Service No. 1, Income Tax; Service No. 2, Estate and Gift Tax; Service No. 3, Employment Taxes; and Service No. 4, Excise Taxes. Each service consists of a basic volume and a cumulative supplement that provides (1) finding lists of items published in the Bulletin, (2) digests of revenue rulings, revenue procedures, and other published items, and (3) indexes of Public Laws, Treasury Decisions, and tax Conventions.

Caution:

Although the BIDS is an excellent starting point for researching historical publications, it is no longer published by the IRS. Therefore, publications and the referenced materials since approximately 1994 will not be included.

Exhibit 32.2.3-2  (08-11-2004)
Format for Typed Draft of Proposed Revenue Ruling Under the Code

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Exhibit 32.2.3-3  (08-11-2004)
Format for Typed Draft of Proposed Revenue Ruling Under Tax Convention

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Exhibit 32.2.3-4  (08-11-2004)
Format for Typed Draft of Proposed Revenue Procedure

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Exhibit 32.2.3-5  (08-11-2004)
Format for Typed Draft of Proposed Revenue Procedure

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Exhibit 32.2.3-6  (08-11-2004)
Format for Typed Draft of Proposed Announcement

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Exhibit 32.2.3-7  (08-11-2004)
Format for Typed Draft of Proposed News Release

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Exhibit 32.2.3-8  (08-11-2004)
Format for Typed Draft Cross-Reference Sheet

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Exhibit 32.2.3-9  (08-11-2004)
Sample Effective Date Provisions

A. Revenue Rulings

  1. With respect to a tax convention (from Rev. Rul. 2002-16, 2002-15 l.R.B. 740):

    • This revenue ruling is effective with respect to taxable years beginning on or after January 1, 2001. This revenue ruling will cease to be effective if the Netherlands Individual Income Tax Act of 2001 is modified in any material respect for tax years that are affected by such change. Taxpayers are responsible for determining whether any such modifications have occurred.

  2. From a date certain (from Rev. Rul. 96-7, 1996-1 C.B. 59):

    • This revenue ruling is effective for plan years beginning after December 31, 1995.

  3. From a date certain with exceptions (from Rev. Rul. 2002-55, 2002-37 I.R.B. 1):

    • This revenue ruling is effective for taxable years beginning after December 31, 2002. However, taxpayers may rely on this revenue ruling for prior periods.

  4. From a specified event (from Rev. Rul. 2002-35, 2002-23 I.R.B. 1067):

    • This revenue ruling is effective for payments to employees after October 13,1988 (the date of enactment for § 62(c), as part of the Family Support Act of 1988).

  5. With prospective application (from Rev. Rul. 99-40, 1999-2 C.B. 441):

    • Pursuant to § 7805(b), this ruling will not be applied adversely to a taxpayer that designated an overpayment to apply to an installment of estimated tax in accordance with Rev. Rul. 84-58 prior to October 4, 1999.

B. Revenue Procedures

  1. Stated in terms of a specific date (from Rev. Proc. 98-39, 1998-1 C.B. 1320):

    • This revenue procedure is effective on August 18, 1997.

  2. Stated in terms of taxable years beginning before the date of publication (from Rev. Proc. 2001-9, 2001-1 C.B. 328):

    • This revenue procedure is effective for taxable years commencing after December 31, 1999.

  3. Stated in terms of events occurring after the beginning of the current calendar year (from Rev. Proc. 79-26, 1979-1 C.B. 566):

    • The revisions set forth in this revenue procedure are effective for property first placed in service in taxable years beginning after December 31, 1978.

  4. Stated in terms of requests submitted after the beginning of the calendar year (from Rev. Proc. 79-4, 1979-1 C.B. 483):

    • This revenue procedure is effective for all requests submitted after December 31, 1978.

  5. Until a date specified in future guidance (from Rev. Proc. 2002-12, 2001-3 I.R.B. 335):

    • This revenue procedure applies to all transfers of noneconomic residual interests in REMICs and all transfers of FASIT ownership interests occurring on or after February 4, 2000, until the date specified in future published guidance.

  6. For a limited audience (from Rev. Proc. 99-43, 1999-2 C.B. 579):

    • This revenue procedure is effective for taxpayer requests made for the application of the net interest rate of zero in § 6621(d) to interest accruing before October 1, 1998.

  7. Stated in terms of a general effective date, transition rules, and special rules (from Rev. Proc. 2002-9, 2002-3 l.R.B. 1):

    • .01 In general. Except as provided in sections 13.02 and 13.03 of this revenue procedure, this revenue procedure is effective for taxable years ending on or after December 31, 2001. The Service will return any application that is filed on or after December 31, 2001, if....

    • .02 Transition rules. If a taxpayer filed an application or ruling request with the national office to make a change in method of accounting described in the APPENDIX of this revenue procedure for a year of change for which this revenue procedure is effective (see section 13.01 of this revenue procedure), and the application or ruling request is pending with the national office on December 31, 2001, the taxpayer may make the change under this revenue procedure. However, ...

    • .03 Special rules. ...

C. Notices

  1. For events occurring after a certain date (from Notice 2000-38, 2000-2 C.B. 174):

    • This notice is applicable with respect to deferrals and distributions made after December 31, 2001. Plan sponsors, plan administrators, and taxpayers may rely on this notice for distributions and deferrals before January 1, 2002.

  2. As of a date certain (from Notice 2001-62, 2001-2 C.B. 307):

    • This notice is effective on September 1, 2001.

  3. To apply to certain elections (from Notice 98-25, 1998-1 C.B. 979):

    • This notice applies to an election made for the first taxable year of a trust beginning after December 31, 1996. The provisions of this notice will be incorporated into regulations that will be effective for taxable years beginning after December 31, 1996.

  4. To alert taxpayers to the effect of a new regulations on existing revenue rulings and revenue procedures (from Notice 97-1, 1997-1 C.B. 348):

    • ... effective January 1, 1997, such revenue rulings and revenue procedures are obsolete to the extent that they use the prior classification regulations to differentiate between partnerships and associations.

D. Announcements

  1. For announcing test procedures for an arbitration program (from Announcement 2000-4, 2000-1 C.B. 317):

    • These procedures are effective for requests for arbitration made during the two-year test period beginning on January 18, 2000, the date this announcement is published in the Internal Revenue Bulletin.

  2. For announcing a change in an address previously provided in a revenue procedure (from Announcement 2001-22, 2001-1 C.B. 895):

    • The address has been changed, and the new address, effective immediately, is as follows...

  3. To announce a correction made in the Federal Register to final regulations (from Announcement 2001-40, 2001-1 C.B. 1141):

    • This correction is effective December 20, 2000.

Exhibit 32.2.3-10  (08-11-2004)
Model Language for the Paperwork Reduction Act

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