Bulletin No. 1998–30

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July 27, 1998

Internal Revenue

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HIGHLIGHTS

OF THIS ISSUE

These synopses are intended only as aids to the reader in

identifying the subject matter covered. They may not be

relied upon as authoritative interpretations.

INCOME TAX

Rev. Rul. 98–35, page 4.

LIFO; price indexes; department stores. The May 1998

Bureau of Labor Statistics price indexes are accepted for

use by department stores employing the retail inventory and

last-in, first-out inventory methods for valuing inventories for

tax years ended on, or with reference to, May 31, 1998.

EMPLOYEE PLANS

Notice 98–37, page 13.

Weighted average interest rate update. Guidelines are

set forth for determining for July 1998, the weighted average interest rate and the resulting permissible range of interest rates used to calculate current liability for purposes

of the full funding limitation of section 412(c)(7) of the Code

as amended by the Omnibus Budget Reconciliation Act of

1987 and by the Uruguay Round Agreements Act (GATT).

EXEMPT ORGANIZATIONS

Announcement 98–70, page 17.

A list is provided of organizations that no longer qualify as

organizations for which contributions are deductible under

section 170 of the Code.

Finding Lists begin on page 21.

Department of the Treasury

Internal Revenue Service

Announcement 98–71, page 17.

A list is given of organizations now classified as private foundations.

EXCISE TAX

T.D. 8774, page 5.

REG–119227–97, page 13.

Temporary and proposed regulations under section 4082 of

the Code relate to the kerosene and aviation fuel excise

taxes and the tax on the first retail sale of certain tractors

and truck, trailer, and semitrailer chassis and bodies (heavy

vehicles). A public hearing on the proposed regulations will

be held on November 4, 1998.

ADMINISTRATIVE

Announcement 98–69, page 16.

INTL–54–91 and INTL–178–86 (1991–2 C.B. 1070), relating to foreign liquidations and reorganizations under section

367 of the Code, are amended.

Mission of the Service

ucts and services; and perform in a manner warranting

the highest degree of public confidence in our integrity, efficiency, and fairness.

The purpose of the Internal Revenue Service is to collect

the proper amount of tax revenue at the least cost; serve

the public by continually improving the quality of our prod-

Statement of Principles

of Internal Revenue

Tax Administration

The Service also has the responsibility of applying and

administering the law in a reasonable, practical manner.

Issues should only be raised by examining officers when

they have merit, never arbitrarily or for trading purposes.

At the same time, the examining officer should never hesitate to raise a meritorious issue. It is also important that

care be exercised not to raise an issue or to ask a court to

adopt a position inconsistent with an established Service

position.

The function of the Internal Revenue Service is to administer the Internal Revenue Code. Tax policy for raising revenue

is determined by Congress.

With this in mind, it is the duty of the Service to carry out that

policy by correctly applying the laws enacted by Congress;

to determine the reasonable meaning of various Code provisions in light of the Congressional purpose in enacting them;

and to perform this work in a fair and impartial manner, with

neither a government nor a taxpayer point of view.

Administration should be both reasonable and vigorous. It

should be conducted with as little delay as possible and

with great courtesy and considerateness. It should never

try to overreach, and should be reasonable within the

bounds of law and sound administration. It should, however, be vigorous in requiring compliance with law and it

should be relentless in its attack on unreal tax devices and

fraud.

At the heart of administration is interpretation of the Code. It

is the responsibility of each person in the Service, charged

with the duty of interpreting the law, to try to find the true

meaning of the statutory provision and not to adopt a

strained construction in the belief that he or she is “protecting the revenue.” The revenue is properly protected only

when we ascertain and apply the true meaning of the statute.

Introduction

The Internal Revenue Bulletin is the authoritative instrument

of the Commissioner of Internal Revenue for announcing official rulings and procedures of the Internal Revenue Service

and for publishing Treasury Decisions, Executive Orders, Tax

Conventions, legislation, court decisions, and other items of

general interest. It is published weekly and may be obtained

from the Superintendent of Documents on a subscription

basis. Bulletin contents of a permanent nature are consolidated semiannually into Cumulative Bulletins, which are sold

on a single-copy basis.

dures must be considered, and Service personnel and others concerned are cautioned against reaching the same conclusions in other cases unless the facts and circumstances

are substantially the same.

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.

It is the policy of the Service to publish in the Bulletin all substantive rulings necessary to promote a uniform application

of the tax laws, including all rulings that supersede, revoke,

modify, or amend any of those previously published in the

Bulletin. All published rulings apply retroactively unless otherwise indicated. Procedures relating solely to matters of internal management are not published; however, statements

of internal practices and procedures that affect the rights

and duties of taxpayers are published.

Part II.—Treaties and Tax Legislation.

This part is divided into two subparts as follows: Subpart A,

Tax Conventions, and Subpart B, Legislation and Related

Committee Reports.

Part III.—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 Bank Secrecy Act Administrative Rulings. Bank Secrecy Act Administrative Rulings

are issued by the Department of the Treasury’s Office of the

Assistant Secretary (Enforcement).

Revenue rulings represent the conclusions of the Service on

the application of the law to the pivotal facts stated in the

revenue ruling. In those based on positions taken in rulings

to taxpayers or technical advice to Service field offices,

identifying details and information of a confidential nature

are deleted to prevent unwarranted invasions of privacy and

to comply with statutory requirements.

Part IV.—Items of General Interest.

With the exception of the Notice of Proposed Rulemaking

and the disbarment and suspension list included in this part,

none of these announcements are consolidated in the Cumulative Bulletins.

Rulings and procedures reported in the Bulletin do not have

the force and effect of Treasury Department Regulations,

but they may be used as precedents. Unpublished rulings

will not be relied on, used, or cited as precedents by Service

personnel in the disposition of other cases. In applying published rulings and procedures, the effect of subsequent legislation, regulations, court decisions, rulings, and proce-

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 semiannual basis

and are published in the first Bulletin of the succeeding semiannual period, respectively.

The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.

For sale by the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402.

Part I. Rulings and Decisions Under the Internal Revenue Code of 1986

Section 472.—Last-in, First-out

Inventories

26 CFR 1.472–1: Last-in, first-out inventories.

LIFO; price indexes; department

stores. The May 1998 Bureau of Labor

Statistics price indexes are accepted for

use by department stores employing the

retail inventory and last-in, first-out inventory methods for valuing inventories

for tax years ended on, or with reference

to, May 31, 1998.

Rev. Rul. 98–35

The following Department Store Inventory Price Indexes for May 1998 were issued by the Bureau of Labor Statistics.

The indexes are accepted by the Internal

Revenue Service, under § 1.472–1(k) of

the Income Tax Regulations and Rev.

Proc. 86–46, 1986–2 C.B. 739, for appropriate application to inventories of department stores employing the retail inventory and last-in, first-out inventory

methods for tax years ended on, or with

reference to, May 31, 1998.

The Department Store Inventory Price

Indexes are prepared on a national basis

and include (a) 23 major groups of departments, (b) three special combinations of

the major groups – soft goods, durable

goods, and miscellaneous goods, and (c) a

store total, which covers all departments,

including some not listed separately, except for the following: candy, food,

liquor, tobacco, and contract departments.

BUREAU OF LABOR STATISTICS, DEPARTMENT STORE

INVENTORY PRICE INDEXES BY DEPARTMENT GROUPS

(January 1941 = 100, unless otherwise noted)

May

1997

May

1998

Percent Change

from May 1997

to May 19981

1. Piece Goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 529.2

2. Domestics and Draperies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 649.3

3. Women’s and Children’s Shoes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 663.7

4. Men’s Shoes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 918.8

5. Infants’ Wear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 642.0

6. Women’s Underwear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 537.7

7. Women’s Hosiery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296.7

8. Women’s and Girls’ Accessories . . . . . . . . . . . . . . . . . . . . . . . . . . . . 566.2

9. Women’s Outerwear and Girls’ Wear . . . . . . . . . . . . . . . . . . . . . . . . 435.1

10. Men’s Clothing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 630.2

11. Men’s Furnishings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601.9

12. Boys’ Clothing and Furnishings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500.2

13. Jewelry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1004.9

14. Notions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 755.8

15. Toilet Articles and Drugs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 907.2

16. Furniture and Bedding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 673.4

17. Floor Coverings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 592.7

18. Housewares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 806.3

19. Major Appliances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 242.0

20. Radio and Television . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

76.7

21. Recreation and Education2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109.8

22. Home Improvements2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132.4

23. Auto Accessories2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107.2

534.6

637.0

664.2

907.9

629.1

576.1

306.1

546.5

425.4

634.5

608.6

497.9

986.2

786.5

951.0

682.1

602.7

814.2

238.5

72.1

105.1

134.3

106.6

1.0

–1.9

0.1

–1.2

–2.0

7.1

3.2

–3.5

–2.2

0.7

1.1

–0.5

–1.9

4.1

4.8

1.3

1.7

1.0

–1.4

–6.0

–4.3

1.4

–0.6

Groups 1 – 15: Soft Goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

612.3

612.0

0.0

Groups 16 – 20: Durable Goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

465.4

462.5

–0.6

Groups 21 – 23: Misc. Goods2

................................

112.2

109.1

–2.8

Store Total3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

560.7

557.9

–0.5

Groups

1Absence of a minus sign before percentage change in this column signifies price increase.

2Indexes on a January 1986=100 base.

3The store total index covers all departments, including some not listed separately, except for the following: candy, foods, liquor, to-

bacco, and contract departments.

July 27, 1998

1998–30 I.R.B.

DRAFTING INFORMATION

The principal author of this revenue

ruling is Stan Michaels of the Office of

Assistant Chief Counsel (Income Tax and

Accounting). For further information regarding this revenue ruling, contact Mr.

Michaels on (202) 622-4970 (not a tollfree call).

Section 4082.—Exemptions for

Diesel Fuel and Kerosene

26 CFR 48.4082–8T: Kerosene; exemption for

aviation-grade kerosene (temporary).

T.D. 8774

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 48, 145, and 602

Kerosene Tax; Aviation Fuel Tax;

Tax on Heavy Trucks and

Trailers

AGENCY: Internal Revenue Service

(IRS), Treasury.

ACTION: Temporary regulations.

SUMMARY: This document contains

temporary regulations relating to the

kerosene and aviation fuel excise taxes

and the tax on the first retail sale of certain

tractors and truck, trailer, and semitrailer

chassis and bodies (heavy vehicles). The

regulations provide rules for the kerosene

tax, the refund available to certain aviation producers, and the tax on heavy vehicles. The regulations relating to kerosene

affect the tax liability of certain industrial

users, refiners, terminal operators,

throughputters, and persons that sell, buy,

or use kerosene. The regulations relating

to aviation fuel affect certain producers,

retailers, and users of aviation fuel. The

regulations relating to the tax on heavy

vehicles affect vehicle manufacturers and

dealers. The text of these regulations also

serves as the text of the proposed regulations set forth in REG–119227–97,

page 13 of this Bulletin.

DATES: These regulations are effective

July 1, 1998. For dates of applicability,

see §§48.4082–6T, 48.4082–7T(b),

48.4082–8T(f), 48.4082–9T(b), 48.40913T(f), 48.4101–3T(e), 48.6427–10T(c),

1998–30 I.R.B.

48.6427–11T(g), and 145.4052–1(a)(2)(ii).

FOR FURTHER INFORMATION CONTACT: Frank Boland (202) 622-3130 (not

a toll-free call).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

These temporary regulations are being

issued without prior notice and public

procedure pursuant to the Administrative

Procedure Act (5 U.S.C. 553). For this

reason, the collection of information contained in these regulations has been reviewed and, pending receipt and evaluation of public comments, approved by the

Office of Management and Budget under

control number 1545–1608. Responses to

this collection of information are required

to obtain a tax benefit.

An agency may not conduct or sponsor,

and a person is not required to respond to,

a collection of information unless the collection of information displays a valid

OMB control number.

For further information concerning this

collection of information, and where to

submit comments on the collection of information and the accuracy of the estimated burden, and suggestions for reducing this burden, please refer to the

preamble to the notice of proposed rulemaking in REG–119227–97.

Books or records relating to a collection of information must be retained as

long as their contents may become material in the administration of any internal

revenue law. Generally, tax returns and

tax return information are confidential, as

required by 26 U.S.C. 6103.

Background

This document contains amendments

to excise tax regulations (26 CFR parts

48 and 145) that implement certain

changes made by the Taxpayer Relief Act

of 1997 (the 1997 Act) relating to taxes

on kerosene, aviation fuel, and heavy

vehicles.

Kerosene; the 1997 Act

Section 4081 imposes a tax on certain

removals, entries, and sales of taxable

fuel. Before July 1, 1998, taxable fuel

means gasoline and diesel fuel. As of that

date, however, the definition of taxable

fuel is expanded by the 1997 Act to include kerosene. Thus, after June 30,

1998, tax is imposed on the removal of

kerosene from a terminal at the terminal

rack.

In addition, the 1997 Act extends the

rules for the exemption of dyed diesel fuel

to dyed kerosene. Thus, tax is not imposed on kerosene that (1) the IRS determines is destined for a nontaxable use

(such as for heating), (2) is indelibly dyed

in accordance with IRS regulations, and

(3) meets any marking requirements that

may be prescribed in regulations.

Also, the 1997 Act provides that

undyed kerosene that is destined for a

nontaxable use may be removed, entered,

or sold tax free in three situations. First,

in the case of aviation-grade kerosene,

dyeing is not required if the kerosene is

received by a person that is registered by

the IRS for purposes of the aviation fuel

tax imposed by section 4091. Second,

dyeing is not required for feedstock

kerosene that is received from a pipeline

or vessel by a registered kerosene feedstock user. Kerosene used as a feedstock

by other persons is exempt from the dyeing requirement to the extent provided by

regulations. Finally, to the extent prescribed by regulations, dyeing is not required if kerosene is received by a registered wholesale distributor that sells

kerosene exclusively to ultimate vendors

that sell kerosene from a pump that is not

suitable for use in fueling any diesel-powered highway vehicle or train (a blocked

pump).

The 1997 Act adds section 4101(e) to

provide that a terminal for kerosene or

diesel fuel cannot be an approved terminal unless the operator of the terminal offers dyed diesel fuel and dyed kerosene

for removal for nontaxable use. This provision is not applicable until July 1, 2000.

The 1997 Act generally applies to

kerosene the credit and refund rules that

apply to diesel fuel. Thus, a credit or refund is allowable to a registered ultimate

vendor that sells taxed, undyed kerosene

for use on a farm for farming purposes or

for the exclusive use of a state or local government. In addition, a credit or refund is

allowable to a registered ultimate vendor

that sells taxed, undyed kerosene from a

blocked pump or, to the extent provided by

the Secretary of the Treasury, for blending

July 27, 1998

with heating oil to be used during periods

of extreme or unseasonable cold.

Kerosene; explanation of provisions

Because kerosene is classified as a taxable fuel as of July 1, 1998, the rules (including definitions) in the existing regulations that apply to taxable fuel generally

apply to kerosene.

The temporary regulations define

kerosene as the kerosene described in

ASTM Specification D 3699 (No. 1–K

and No. 2–K) and ASTM Specification D

1655 (kerosene-type jet fuel).

Under the temporary regulations, tax is

not imposed on the removal, entry, or sale

of kerosene that is dyed with dye of the

same strength and composition that is

now required for diesel fuel. Also, every

retail pump where dyed kerosene is sold

must display a prescribed notice similar to

the one now required on dyed diesel fuel

pumps.

Under the temporary regulations, tax

generally is not imposed on aviationgrade kerosene if the person that receives

the kerosene in a transaction otherwise

subject to tax (such as a person that buys

kerosene at a terminal rack) is registered

with respect to the section 4091 tax and,

for sales after September 30, 1998, certifies that the kerosene will be used as a

fuel in an aircraft. These buyers include

registered aviation fuel producers (that is,

persons with IRS registration numbers

with an “H” suffix) and registered commercial airlines.

Transitional rules provide that tax generally is not imposed on aviation-grade

kerosene that is destined for use as aviation fuel if an unregistered person (such

as a fixed-base operator) receives the

kerosene at a terminal rack and certifies

(for sales after September 30, 1998) that

the kerosene will be used as a fuel in an

aircraft. The Treasury Department is considering whether this provision should be

made a part of the final regulations, or

whether persons that are presently unregistered should be required to register in

order to receive aviation-grade kerosene

tax free and requests comments on this

issue. Comments may be submitted in the

manner described under the ADDRESSES caption in the notice of proposed rulemaking on these subjects in

REG–119227–97.

July 27, 1998

The temporary regulations describe the

conditions under which a registered ultimate vendor may be eligible for a credit

or refund with respect to taxed kerosene

that it sells from a blocked pump. A

blocked pump is defined as a fuel pump

that is at a fixed location and that cannot

be used to fuel any diesel-powered highway vehicle or train. Also, blocked

pumps must display a prescribed notice.

The temporary regulations do not provide rules for the following: (1) the exception from the dyeing requirement for

kerosene that is removed from a terminal

for use as a feedstock, (2) the exception

from the dyeing requirement for kerosene

that is received by a registered wholesale

distributor that sells kerosene exclusively

to ultimate vendors that sell kerosene from

a blocked pump, (3) the availability of a

credit or refund to a registered ultimate

vendor that sells kerosene for blending

with heating oil to be used during periods

of extreme or unseasonable cold, and (4)

the requirement that a terminal for

kerosene or diesel fuel cannot be an approved terminal unless the operator of the

terminal offers dyed diesel fuel and dyed

kerosene for removal for nontaxable use.

Comments are also requested on these issues. Comments may be submitted in the

manner described under the ADDRESSES

caption in the notice of proposed rulemaking on these subjects in REG–119227–97.

Aviation fuel

The 1997 Act added section 4091(d),

which allows a registered aviation fuel

producer (including a registered wholesale distributor) to obtain a refund of tax

previously paid on aviation fuel that it

buys. The temporary regulations describe

the procedures to be followed for the allowance of this refund. These procedures

are similar to the procedures under section 4081(e) for refunds relating to taxable fuel on which two taxes have been

paid.

Registration of heavy vehicle

manufacturers and retailers

The tax on the sale of heavy vehicles

imposed by section 4051 is a tax that applies to the first retail sale by the manufacturer, importer, or retailer of a vehicle.

The tax is not imposed if a vehicle is sold

for resale or for lease on a long-term

basis. Under existing regulations, this

tax-free treatment applies only if both the

seller and the buyer are registered by the

IRS. Under the 1997 Act, however, the

Treasury Department is to revise those

regulations so that those sales may be

made tax free even if the parties have not

been registered by the IRS.

These temporary regulations generally

provide that a person, such as a vehicle

manufacturer, may sell a vehicle tax free

if it accepts from its buyer, such as a vehicle retailer, a prescribed statement, signed

under penalties of perjury, stating that the

buyer will resell the vehicle or lease it on

a long-term basis. Neither party will be

required to be registered.

The temporary regulations do not affect

the registration requirements for tax-free

sales under section 4221, such as sales for

the exclusive use of a state or local

government.

Special Analyses

It has been determined that this Treasury decision is not a significant regulatory action as defined in EO 12866.

Therefore, a regulatory assessment is not

required. It also has been determined that

section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not

apply to these regulations. It is hereby

certified that the collection of information

in these regulations will not have a significant economic impact on a substantial

number of small entities. This certification is based upon the fact that the time

required to prepare and submit the exemption certificates described in these

regulations (many of which are similar to

certificates that are already in use) is minimal and will not have a significant impact on those small entities that choose to

provide the certificates. 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, these temporary regulations will be

submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small

business.

Drafting Information

The principal author of these regulations is Frank Boland, Office of the Assis-

1998–30 I.R.B.

tant Chief Counsel (Passthroughs and

Special Industries), IRS. However, other

personnel from the IRS and Treasury Department participated in their development.

* * * * *

Adoption of Amendments to the

Regulations

Accordingly, 26 CFR parts 48, 145,

and 602 are amended as follows:

PART 48—MANUFACTURERS AND

RETAILERS EXCISE TAX

REGULATIONS

Paragraph 1. The authority citation for

part 48 is amended by adding entries in

numerical order to read in part as follows:

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

Sections 48.4082–6T, 48.4082–7T, and

48.4082–8T also issued under 26 U.S.C.

4082 * * *

Section 48.4101–3 also issued under 26

U.S.C. 4101(a) * * *

Sections 48.6427–10T and 48.6427–

11T also issued under 26 U.S.C. 6427(n)

***

Par. 2. Section 48.4081–1T is added to

read as follows:

§48.4081–1T Taxable fuel; definitions

(temporary).

(a) [Reserved]

(b) Definitions.

Kerosene means, after June 30,

1998,—

(1) The two grades of kerosene (No.

1–K and No. 2–K) described in ASTM

Specification D 3699; and

(2) Kerosene-type jet fuel described in

ASTM Specification D 1655 and military

specifications MIL–T–5624R and MIL–

T–83133D (Grades JP–5 and JP–8). For

availability of ASTM and military specification material, see §48.4081–1(c)(2)(i).

Par. 3. Sections 48.4082–6T, 48.4082–

7T, 48.4082–8T, 48.4082–9T, and

48.4082–10T are added to read as follows:

§48.4082–6T Kerosene; treatment as

diesel fuel in certain cases (temporary).

For purposes of §§48.4081–1(b) (the

definition of taxable fuel), 48.4081–2(c),

48.4082–1, 48.4082–4, and 48.4082–5,

after June 30, 1998, diesel fuel includes

kerosene.

1998–30 I.R.B.

§48.4082–7T Kerosene; notice required

with respect to dyed kerosene

(temporary).

(a) In general. A legible and conspicuous notice stating: “DYED KEROSENE,

NONTAXABLE USE ONLY, PENALTY

FOR TAXABLE USE” must be posted by

a seller on any retail pump or other delivery facility where it sells dyed kerosene

for use by its buyer. Any seller that fails

to post the required notice on any retail

pump or other delivery facility where it

sells dyed kerosene is, for purposes of the

penalty imposed by section 6715, presumed to know that the fuel will not be

used for a nontaxable use.

(b) Effective date. This section is applicable after June 30, 1998.

§48.4082–8T Kerosene; exemption for

aviation-grade kerosene (temporary).

(a) Overview. This section provides

rules for exempting aviation-grade

kerosene from the tax imposed by section

4081. Generally, under prescribed conditions, tax is not imposed on a removal,

entry, or sale of aviation-grade kerosene if

the kerosene is destined for use as a fuel

in an aircraft.

(b) Definition.

Aviation-grade kerosene means

kerosene-type jet fuel described in ASTM

Specification D 1655 and military specifications MIL–T–5624R and MIL–T–

83133D (Grades JP–5 and JP–8). For

availability of ASTM and military specification material, see §48.4081–1(c)(2)(i).

section 4081 on the removal or entry not

in connection with a sale of aviationgrade kerosene if—

(1) The person otherwise liable for tax

is a taxable fuel registrant;

(2) In the case of a removal from a terminal, the terminal is an approved terminal; and

(3) The kerosene will be used as fuel in

an aircraft and—

(i) The person otherwise liable for tax

subsequently delivers the kerosene into

the fuel supply tank of an aircraft or is

registered under section 4101 with respect

to the tax imposed by section 4091; or

(ii) The section 4091 tax has been imposed on the kerosene.

(d) Removals and entries in connection

with sales. Tax is not imposed under section 4081 on the removal or entry of aviation-grade kerosene in connection with a

sale if—

(1) The person otherwise liable for tax

is a taxable fuel registrant;

(2) In the case of a removal from a terminal, the terminal is an approved terminal; and

(3) The kerosene will be used as fuel in

an aircraft and—

(i) The buyer is registered under section 4101 with respect to the tax imposed

by section 4091;

(ii) The buyer is buying for its use in a

nontaxable use (as defined in section

4092(a)); or

(iii) The section 4091 tax is, or has

been, imposed on the kerosene.

(e) Evidence under paragraph (d)(3)—

(1) In general—(i) Sales before October

1, 1998. For sales before October 1,

1998, the requirements of paragraph

(d)(3) of this section will be considered to

have been met if the person otherwise liable for tax has an unexpired certificate

(described in this paragraph (e)) from the

buyer and has no reason to believe that

any information in the certificate is false.

(ii) Sales after September 30, 1998.

For sales after September 30, 1998, the

requirements of paragraph (d)(3) of this

section are met only if the person otherwise liable for tax has an unexpired certificate (described in this paragraph (e))

from the buyer and has no reason to believe that any information in the certificate is false.

(2) Certificate. The certificate to be

provided by a buyer of aviation-grade

kerosene is a statement signed under

penalties of perjury by a person with authority to bind the buyer, in substantially

the same form as the model certificate

provided in paragraph (e)(4) of this section, and that contains all information

necessary to complete the model certificate. A new certificate or notice that the

correct certificate is invalid must be given

if any information in the current certificate changes. The certificate may be included as part of any business records

normally used to document a sale. The

certificate expires on the earliest of the

following dates:

(i) The date one year after the effective

date of the certificate (which may be no

earlier than the date it is signed).

July 27, 1998

(ii) The date the buyer provides a new

certificate or notice that the current certificate is invalid to the seller.

(iii) The date the seller is notified by

the Internal Revenue Service or the buyer

that the buyer’s right to provide a certificate has been withdrawn.

(3) Withdrawal of the right to provide a

certificate. The Internal Revenue Service

may withdraw the right of a buyer of aviation-grade kerosene to provide a certificate under this section if the buyer uses or

disposes of aviation-grade kerosene to

which a certificate applies other than as a

fuel in an aircraft. The Internal Revenue

Service may notify any seller to whom the

buyer has provided a certificate that the

buyer’s right to provide a certificate has

been withdrawn.

(4) Model certificate.

CERTIFICATE OF PERSON BUYING AVIATION-GRADE

KEROSENE FOR USE AS A FUEL IN AN AIRCRAFT

(To support tax-free removals and entries of aviation-grade kerosene under section 4081 of the Internal Revenue Code.)

Name, address, and employer identification number of seller ________________________ (“Buyer”) certifies the following under

penalties of perjury:

Name of Buyer

The aviation-grade kerosene to which this certificate relates will be used as fuel in an aircraft.

Buyer is (check one):

________________ Registered under section 4101 of the Internal Revenue Code with respect to the tax imposed by section 4091

with a registration number of _____________

________________ Buying the kerosene for its use in a nontaxable use (as defined in section 4092(a)).

________________ Buying the kerosene for its use (other than a nontaxable use) in commercial aviation (as defined in section

4092(b)).

________________ Buying the kerosene for its use (other than a nontaxable use) in noncommercial aviation (as defined in section 4041(c)(2)).

________________ Buying the kerosene for resale.

This certificate applies to the following (complete as applicable):

If this is a single purchase certificate, check here _________ and enter:

1. Invoice or delivery ticket number ________________________________________

2. _______ (number of gallons)

If this is a certificate covering all purchases under a specified account or order number, check here ___________ and enter:

1. Effective date ____________________

2. Expiration date ___________________

(period not to exceed 1 year after the effective date)

3. Buyer account or order number ___________________

Buyer will provide a new certificate to the seller if any information in this certificate changes.

Buyer understands that if Buyer violates the terms of this certificate, the Internal Revenue Service may withdraw Buyer’s right to

provide a certificate.

Buyer has not been notified by the Internal Revenue Service that its right to provide a certificate has been withdrawn.

Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making any fraudulent use of this

certificate to a fine or imprisonment, or both, together with the costs of prosecution.

Printed or typed name of person signing

Title of person signing

Employer identification number

Address of Buyer

Signature and date signed

July 27, 1998

1998–30 I.R.B.

(f) Effective date. This section is applicable after June 30, 1998.

48.4082–9T Kerosene; exemption for

non-fuel feedstock purposes (temporary).

(a) In general. Tax is not imposed

under section 4081 and §48.4081-3(e)(1)

if, upon the removal of kerosene from a

pipeline or vessel, the kerosene is received by a taxable fuel registrant that is a

kerosene feedstock user. For this purpose, a kerosene feedstock user is a person that receives kerosene by bulk transfer for its own use in the manufacture or

production of any substance (other than

gasoline, diesel fuel, or special fuels referred to in section 4041).

(b) Effective date. This section is applicable after June 30, 1998.

§48.4082–10T Kerosene; additional

exemption from floor stocks tax

(temporary).

The floor stocks tax imposed by section

1032(g) of the Taxpayer Relief Act of

1997 does not apply to kerosene that satisfies the dyeing requirements of

§48.4082-1(b) by the earlier of—

(a) September 30, 1998; or

(b) The time the kerosene is sold by the

person otherwise liable for the floor

stocks tax.

Par. 4. Section 48.4091-3T is added to

read as follows:

§48.4091–3T Aviation fuel; conditions to

allowance of refunds of aviation fuel tax

under section 4091(d) (temporary).

(a) Overview. This section provides the

conditions under which a refund of tax

imposed by section 4091 is allowable

with respect to taxed aviation fuel that is

held by a registered aviation fuel producer. No credit against any tax imposed

by the Internal Revenue Code is allowed

under section 4091(d).

(b) Conditions to allowance of refund.

A claim for refund of tax imposed by section 4091 with respect to aviation fuel is

allowed under section 4091(d) and this

section only if—

(1) A tax imposed by section 4091 with

respect to the aviation fuel was paid to the

government by an importer or producer

(the first producer) and the tax has not

been otherwise credited or refunded;

(2) After imposition of the tax, the aviation fuel is acquired by a person that is a

registered aviation fuel producer (the second producer);

(3) The second producer has filed a

timely claim for refund that contains the

information required under paragraph (d)

of this section; and

(4) The first producer and any person

that owns the fuel after its sale by the first

producer and before its purchase by the

second producer (a subsequent seller)

have met the reporting requirements of

paragraph (c) of this section.

general. The reporting requirements of

this paragraph (c)(1) are met if the first

producer files a report (the first producer’s report) that—

(i) Is in substantially the same form as

the model report provided in paragraph

(c)(2) of this section (or such other model

report as the Commissioner may prescribe);

(ii) Contains all information necessary

to complete such model report; and

(iii) Is filed at the time and in the manner prescribed by the Commissioner.

(2) Model first producer’s report.

FIRST PRODUCER’S REPORT

First Producer’s name, address, and employer identification number

Buyer’s name, address, and employer identification number

Date and location of taxable sale

Volume and type of aviation fuel sold

Amount of federal excise tax paid on account of the sale

Under penalties of perjury, First Producer declares that First Producer has examined this statement, including any accompanying

schedules and statements, and, to the best of First Producer’s knowledge and belief, it is true, correct and complete.

Printed or typed name of the person signing

Title of person signing

Signature and date signed

1998–30 I.R.B.

July 27, 1998

(3) Information provided to buyers.

The reporting requirements of this paragraph (c)(3) are met if a first producer that

filed a first producer’s report under paragraph (c)(1) of this section gives a copy of

the report to the person to whom the first

producer sells the aviation fuel.

(4) Statement of subsequent seller—(i)

In general. The reporting requirements of

this paragraph (c)(4) are met if—

(ii)(A) Each subsequent seller gives to

its buyer a copy of a statement that provides all information (whether or not in

the same format) necessary to complete

the model statement prescribed in paragraph (c)(4)(ii) of this section (or such

other model statement as the Commissioner may prescribe); and

(B) The statement is provided at the

bottom or on the back of the copy of the

first producer’s report (or in an attached

document).

(iii) Model statement describing subsequent sale.

STATEMENT OF SUBSEQUENT SELLER (AVIATION FUEL)

Name, address, and employer identification number of seller in subsequent sale

Name, address, and employer identification number of buyer in subsequent sale

Date and location of subsequent sale

Volume and type of aviation fuel sold

The undersigned seller (the Seller) has received the copy of the first producer’s report provided with this statement in connection

with Seller’s purchase of the aviation fuel described in this statement.

Under penalties of perjury, Seller declares that Seller has examined this statement, including any accompanying schedules and

statements, and, to the best of Seller’s knowledge and belief, it is true, correct and complete.

Printed or typed name of person signing

Title of person signing

Signature and date signed

(5) Sale to multiple buyers. If a first producer’s report relates to aviation fuel that is

divided among more than one buyer, multiple copies of the first producer’s report

should be made at the stage that the aviation fuel is divided and a copy given to

each buyer. The reporting requirements of

this paragraph (c) will be met only with respect to the fuel purchased by buyers that

are given a copy of the report including

any statement required under paragraph

(c)(4) of this section.

(d) Form and content of claim—(1) In

general. The following rules apply to

claims for refund under section 4091(d):

(i) The claim must be made by the second producer and must include all the information described in paragraph (d)(2)

of this section.

(ii) The claim must be made on Form

8849 (or such other form as the Commissioner may designate) in accordance with

the instructions on the form. The form

July 27, 1998

should be marked Section 4091(d) Claim

at the top. Section 4091(d) claims must

not be included with a claim for a refund

under any other provision of the Internal

Revenue Code.

(2) Information to be included in the

claim. Each claim for a refund under section 4091(d) must contain the following

information with respect to the aviation

fuel covered by the claim:

(i) Volume and type of aviation fuel.

(ii) Date on which the second producer

acquired the aviation fuel to which the

claim relates.

(iii) Amount of tax that the first producer paid to the government and a statement that the second producer has not included the amount of that tax in the sales

price of the aviation fuel to which the

claim relates and has not collected that

amount from the person that bought the

aviation fuel from the second producer, if

any.

(iv) Name, address, and employer identification number of the first producer that

paid the tax to the government.

(v) A copy of the first producer’s report

that relates to the aviation fuel covered by

the claim.

(vi) A copy of any statement of a subsequent seller that the second producer received with respect to that aviation fuel.

(e) Time for filing claim. A claim for

refund under section 4091(d) may be filed

any time after the first producer has filed

the return of the tax to which the claim relates and before the end of the period prescribed by section 6511 for the filing of a

claim for refund of that tax.

(f) Effective date. This section is applicable with respect to refunds of tax imposed by section 4091 after December 31,

1998.

Par. 5. Section 48.4101–2T is added to

read as follows:

1998–30 I.R.B.

§48.4101–2T Information reporting

(temporary).

(a)(1) through (a)(3). [Reserved]

(a)(4) Registered aviation fuel producers. After June 30, 1999, each person that

is registered under section 4101 as a producer of aviation fuel must make a return

showing—

(i) The name and employer identification number of each unregistered person

to whom it sold aviation fuel for resale;

(ii) The volume of the aviation fuel

sold to such persons;

(iii) The date and location of such

sales; and

(iv) Any other information required by

the Commissioner.

(b) through (d). [Reserved]

Par. 6. Section 48.4101-3T is added to

read as follows:

§48.4101–3T Registration; special rules

for kerosene (temporary).

(a) Application of §48.4101–1. The

references to diesel fuel in §§48.4101–

1(a)(1) and (f)(1)(ii) are treated as references to either diesel fuel or kerosene,

and the references in §§48.4101–

1(b)(5)(i) and (f)(2) to paragraphs (c)(1)

or (d) of §48.4101–1 are treated as references also to paragraph (c) of this section.

(b) Transitional registration rule—(1)

In general. A person is treated as a taxable fuel registrant if, on June 30, 1998,

the person—

(i) Is an enterer, refiner, terminal operator, or throughputter of kerosene and is

registered under section 4101 as a producer or importer of aviation fuel; or

(ii) Operates one or more terminals that

store kerosene (and no other type of taxable fuel) and each position holder at each

of its terminals is a taxable fuel registrant.

(2) Termination. A person treated as

registered under this paragraph (b) is

treated as registered until the earlier of—

(i) The effective date of a registration

issued under §48.4101–1(g)(3) with respect to kerosene;

(ii) The effective date of a revocation

or suspension of registration under

§48.4101–1(i); or

(iii) April 1, 1999.

but is not required to, be registered under

section 4101 with respect to the tax im-

1998–30 I.R.B.

posed by section 4081 if the person is a

kerosene feedstock user (defined in

§48.4082–9T).

(d) Additional terms and conditions of

registration for certain terminal operators. A legible and conspicuous notice

stating: “DYED KEROSENE, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE” must be provided by each

terminal operator to any person that receives dyed kerosene at a terminal rack of

that operator. This notice must be provided by the time of the removal and must

appear on all shipping papers, bills of lading, and similar documents that are provided by the terminal operator to accompany the removal of the fuel.

(e) Effective date. This section is applicable after June 30, 1998.

Par. 7. Sections 48.6427–10T and

48.6427–11T are added to read as follows:

§48.6427–10T Claims with respect to

kerosene (temporary).

(a) Claims under §48.6427–8—(1) In

general. For purposes of §48.6427–8,

diesel fuel includes kerosene.

(2) Blocked pumps. Kerosene is treated

as satisfying the conditions of §48.6427–

8(b)(1) only if it was not sold from a

blocked pump (as described in §48.6427–

11T(b)).

(b) Claims under §48.6427–9. For purposes of §48.6427-9, diesel fuel includes

kerosene.

1998.

§48.6427–11T Special rules for claims by

registered ultimate vendors of kerosene

(blocked pump)(temporary).

(a) Overview. This section provides

rules relating to claims by registered ultimate vendors for payments and income

tax credits with respect to kerosene that is

sold from a blocked pump. For rules relating to claims by registered ultimate

vendors for kerosene that is sold for farming use or use by a State, see §§48.6427–9

and 48.6427–10T.

(b) Definition; blocked pump. A

blocked pump is a fuel pump that meets

the following conditions:

(1) It is used to dispense undyed

kerosene that is sold at retail for use by

the buyer in a nontaxable use.

(2) It is at a fixed location and cannot

(because, for example, of its distance

from a road surface or train track or the

length of its delivery hose) be used to dispense fuel directly into the fuel supply

tank of a diesel-powered highway vehicle

or train.

(3) It is identified with a legible and

conspicuous notice stating: “UNDYED

UNTAXED KEROSENE, NONTAXABLE

USE ONLY”.

payment. Notwithstanding §48.64279(c), a claim for a credit or payment with

respect to undyed kerosene is allowable

under section 6427(l)(5)(B)(i) if—

(1) Tax was imposed by section 4081

on the kerosene to which the claim relates;

(2) The claimant sold the kerosene

from a blocked pump;

(3) The claimant is a registered ultimate vendor of kerosene; and

(4) The claimant has filed a timely

claim for a credit or payment that contains

the information required under paragraph

(e) of this section.

(d) Form of claim. The rules of

§48.6427–9(d) apply to claims filed under

this section.

(e) Content of claim. Each claim for

credit or payment under this section must

contain the following information with respect to all the kerosene covered by the

claim:

(1) The total number of gallons covered

by the claim.

(2) A statement by the claimant that tax

has been imposed on the kerosene covered by the claim.

(3) The claimant’s registration number.

(4) A statement that the claimant has

not included the amount of the tax in its

sales price of the kerosene and has not

collected the amount of tax from its

buyer.

(f) Time and place for filing claim. The

rules of §48.6427–9(f) apply to claims

filed under this section.

(g) Effective date. This section is applicable June 30, 1998.

PART 145—TEMPORARY EXCISE

TAX REGULATIONS UNDER THE

HIGHWAY REVENUE ACT OF 1982

(PUB. L. 97–424)

Par. 8. The authority citation for part

145 continues to read in part as follows:

July 27, 1998

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

Par. 9. Section 145.4052–1 is amended

as follows:

1. Paragraph (a)(2)(ii) is redesignated

as paragraph (a)(2)(ii)(A).

2. Paragraph (a)(2)(ii)(A), as redesignated, is amended by removing the language “Both” and adding “For a sale before July 1, 1998, both” in its place and

removing the language “or” at the end.

3. Paragraph (a)(2)(ii)(B) is added to

read as follows:

CFR part or section

where identified

and described

Current OMB

control number

Approved June 17, 1998.

* * * * *

145.4052–1 . . . . . . . . . . . . . .1545–0120

1545–0745

1545–1076

* * * * *

§145.4052–1 Special rules and

definitions.

2. Adding entries in numerical order to

the table to read as follows:

(a) * * *

(2) * * *

(ii) * * *

(B) For a sale after June 30, 1998, and

regardless of the registration status of the

seller or the purchaser, the seller has in

good faith accepted from the purchaser a

statement that the purchaser executed in

good faith and that is in substantially the

same form as the certificate described in

paragraph (a)(6) of this section, except

that the statement must be signed under

penalties of perjury and need not contain

a registration number, or

§602.101 OMB Control numbers.

* * * * *

PART 602—OMB CONTROL

NUMBERS UNDER THE

PAPERWORK REDUCTION ACT

Par. 10. The authority citation for part

602 continues to read as follows:

Authority: 26 U.S.C. 7805.

Par. 11. In §602.101, paragraph (c) is

amended by:

1. Removing the following entry from

the table:

§602.101 OMB Control numbers.

Michael P. Dolan,

Deputy Commissioner of

Internal Revenue.

Donald C. Lubick,

Assistant Secretary of

the Treasury.

(Filed by the Office of the Federal Register on June

26, 1998, 2:02 p.m., and published in the issue of the

Federal Register for July 1, 1998, 63 F.R. 35799)

* * * * *

CFR part or section

where identified

and described

Current OMB

control number

* * * * *

48.4082–7T . . . . . . . . . . . . . .1545–1608

48.4082–8T . . . . . . . . . . . . . .1545–1608

48.4091–3T . . . . . . . . . . . . . .1545–1608

* * * * *

48.4101–2T . . . . . . . . . . . . . .1545–1608

48.4101–3T . . . . . . . . . . . . . .1545–1608

* * * * *

48.6427–11T . . . . . . . . . . . . .1545–1608

* * * * *

145.4052–1 . . . . . . . . . . . . . .1545–1608

1545–0120

1545–0745

1545–1076

* * * * *

July 27, 1998

1998–30 I.R.B.

Part III. Administrative, Procedural, and Miscellaneous

Weighted Average Interest Rate

Update

Notice 98–37

Notice 88–73 provides guidelines for

determining the weighted average interest

rate and the resulting permissible range of

interest rates used to calculate current liability for the purpose of the full funding

limitation of § 412(c)(7) of the Internal

Revenue Code as amended by the Omnibus Budget Reconciliation Act of 1987

and as further amended by the Uruguay

Round Agreements Act, Pub. L. 103–465

(GATT).

Month

Year

Weighted

Average

July

1998

6.55

Drafting Information

The principal author of this notice is

Donna Prestia of the Employee Plans Division. For further information regarding

this notice, call (202) 622-6076 between

2:30 and 3:30 p.m. Eastern time (not a

toll-free number). Ms. Prestia’s number

is (202) 622-7473 (also not a toll-free

number).

90% to 106%

Permissible

Range

90% to 110%

Permissible

Range

5.90 to 6.95

5.90 to 7.21

bodies. The text of those temporary regulations also serves as the text of these proposed regulations.

SUPPLEMENTARY INFORMATION:

DATES: Written comments must be received by September 29, 1998. Requests

to speak and outlines of oral comments to

be discussed at the public hearing scheduled for Wednesday, November 4, 1998,

must be received by September 29, 1998.

The collection of information contained in this notice of proposed rulemaking has been submitted to the Office of

Management and Budget for review in accordance with the Paperwork Reduction

Act of 1995 (44 U.S.C. 3507(d)). Comments on the collection of information

should be sent to the Office of Management and Budget, Attn: Desk Officer

for the Department of the Treasury, Office

of Information and Regulatory Affairs,

Washington, DC 20503, with copies to

the Internal Revenue Service, Attn: IRS

Reports Clearance Officer, OP:FS:FP,

Washington, DC 20224. Comments on

the collection of information should be received by August 31, 1998. Comments

are specifically requested concerning:

Whether the proposed collection of information is necessary for the proper performance of the functions of the Internal

Revenue Service, including whether the

information will have practical utility;

The accuracy of the estimated burden

associated with the proposed collection of

information (see below);

How the quality, utility, and clarity of

the information to be collected may be enhanced;

How the burden of complying with the

proposed collection of information may

be minimized, including through the application of automated collection techniques or other forms of information technology; and

ACTION: Proposed rule, notice of proposed rulemaking by cross-reference to

temporary regulations and notice of public hearing.

ADDRESSES: Send submissions to:

CC:DOM:CORP:R (REG–119227–97),

room 5226, Internal Revenue Service,

POB 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be

hand delivered between the hours of 8:00

a.m. and 5 p.m. to: CC:DOM:CORP:R

(REG–119227–97), Courier’s Desk, Internal Revenue Service, 1111 Constitution

Avenue, NW, Washington, DC. Alternatively, taxpayers may submit comments

electronically via the Internet by selecting

the “Tax Regs” option on the IRS Home

Page, or by submitting comments directly

to the IRS Internet site at http://www.irs.

ustreas.gov/prod/tax_regs/comments.html.

The public hearing will be held in the IRS

Auditorium, Seventh Floor, 7400 Corridor, Internal Revenue Building, 1111

Constitution Avenue, NW, Washington,

DC.

SUMMARY: In T.D. 8774, page 5 of this

Bulletin, the IRS is issuing temporary

regulations relating to the kerosene and

aviation fuel excise taxes and the tax on

the first retail sale of certain tractors,

truck, trailer, and semitrailer chassis and

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, Frank

Boland (202) 622-3130; concerning submissions and the hearing, LaNita

VanDyke (202) 622-7180 (not toll-free

numbers).

Notice of Proposed Rulemaking

and Notice of Public Hearing

Kerosene Tax; Aviation Fuel Tax;

Tax on Heavy Trucks and

Trailers

REG–119227–97

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 48

AGENCY: Internal Revenue Service

(IRS), Treasury.

1998–30 I.R.B.

The average yield on the 30-year Treasury Constant Maturities for June 1998 is

5.70 percent.

The following rates were determined

for the plan years beginning in the month

shown below.

Paperwork Reduction Act

July 27, 1998

Estimates of capital or start-up costs of

operation, maintenance, and purchase of

services to provide information.

The collection of information in this

notice of proposed rulemaking is in

§§48.4052–1, 48.4082–7(a), 48.4082–

8(e), 48.4091–3(c), 48.4101–2(a)(4),

48.4101–3(d), and 48.6427–11. This information is required to support exempt

transactions and to inform consumers of

the type of fuel that is being purchased.

The likely respondents are businesses and

other for-profit organizations.

Estimated total annual reporting burden: 3,340 hours.

The estimated annual burden per respondent varies from .20 hours to 1 hour,

depending on individual circumstances,

with an estimated average of .29 hour.

Estimated number of respondents:

11,600.

Estimated annual frequency of responses: On occasion.

An agency may not conduct or sponsor,

and a person is not required to respond to,

a collection of information unless the collection of information displays a valid

control number assigned by the Office of

Management and Budget.

Books or records relating to a collection of information must be retained as

long as their contents may become material in the administration of any internal

revenue law. Generally, tax returns and

tax return information are confidential, as

required by 26 U.S.C. 6103.

Background

Temporary regulations published in

T.D. 8774 provide rules relating to the

kerosene tax, certain aviation fuel tax refunds allowed by section 4091(d), and

registration requirements for certain

heavy vehicle manufacturers and retailers. The text of those regulations also

serves as the text of these proposed regulations relating to kerosene. The preamble to the temporary regulations explains

the temporary regulations.

Special Analyses

It has been determined that this notice

of proposed rulemaking is not a significant regulatory action as defined in EO

12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C.

July 27, 1998

chapter 5) does not apply to these regulations. It is hereby certified that the collection of information in these regulations

will not have a significant economic impact on a substantial number of small entities. This certification is based upon the

fact that the time required to prepare and

submit the exemption certificates described in these regulations (many of

which are similar to certificates that are

already in use) is minimal and will not

have a significant impact on those small

entities that choose to provide the certificates. 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 its

impact on small business.

Comments and Public Hearing

Before these proposed regulations are

adopted as final regulations, consideration will be given to any comments that

are submitted (in the manner described in

the ADDRESSES caption) timely to the

IRS. All comments will be available for

public inspection and copying.

A public hearing has been scheduled

for Wednesday, November 4, 1998, at 10

a.m. in the IRS Auditorium, Internal Revenue Building, 1111 Constitution Avenue,

NW, Washington DC. Because of access

restrictions, visitors will not be admitted

beyond the Internal Revenue Building

lobby more than 15 minutes before the

hearing starts.

The rules of 26 CFR 601.601(a)(3)

apply to the hearing.

Persons that wish to present oral comments at the hearing must submit comments by September 29, 1998, and submit

an outline of the topics to be discussed

and the time to be devoted to each topic

by September 29, 1998.

A period of 10 minutes will be allotted

to each person for making comments.

An agenda showing the scheduling of

the speakers will be prepared after the

deadline for receiving outlines has

passed. Copies of the agenda will be

available free of charge at the hearing.

Drafting Information

The principal author of these regulations

is Frank Boland, Office of the Assistant

Chief Counsel (Passthroughs and Special

Industries), IRS. However, other personnel from the IRS and the Treasury Department participated in their development.

* * * * *

Proposed Amendments to the Regulations

Accordingly, 26 CFR part 48 is proposed to be amended as follows:

PART 48—MANUFACTURERS AND

RETAILERS EXCISE TAXES

Paragraph 1. The authority citation for

part 48 is amended by adding entries in

numerical order to read in part as follows:

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

Section 48.4052–1 also issued under 26

U.S.C. 4052 * * *

Sections 48.4082–6, 48.4082–7, and

48.4082–8 also issued under 26 U.S.C.

4082 * * *

Section 48.4101–3 also issued under 26

U.S.C. 4101(a) * * *

Sections 48.6427–10 and 48.6427–11

also issued under 26 U.S.C. 6427(n) * * *

Par. 2. In subpart H, §48.4052–1 is

added to read as follows:

§48.4052–1 Special rule.

After June 30, 1998, the sale of an article is a taxable sale unless the seller has in

good faith accepted from the purchaser a

statement that the purchaser executed in

good faith and that is in substantially the

same form as the certificate described in

§145.4052–1(a)(6) of this chapter, except

that the statement must be signed under

penalties of perjury and need not include

a registration number.

Par. 3. Section 48.4081–1 is amended

as follows:

1. Paragraph (b) is amended by adding

the definition of kerosene.

2. Paragraph (d) is revised.

The addition and revision read as follows:

§48.4081–1 Taxable fuel; definitions.

* * * * *

(b) * * *

Kerosene means—

(1) The two grades of kerosene (No.

1–K and No. 2–K) described in ASTM

Specification D 3699; and

(2) Kerosene-type jet fuel described in

ASTM Specification D 1655 and military

1998–30 I.R.B.

specifications MIL–T–5624R and MIL–

T–83133D (Grades JP–5 and JP–8). For

availability of ASTM and military specification material, see §48.4081–1(c)(2)(i).

* * * * *

(d) Effective date.

(1) Except as provided in paragraph

(d)(2) of this section, this section is applicable January 1, 1994.

(2) In paragraph (b) of this section—

(i) The definition of aviation gasoline

and the third sentence in the definition of

terminal are applicable January 2, 1998;

and

(ii) The definition of kerosene is applicable July 1, 1998.

Par. 4. Sections 48.4082–6, 48.4082–7,

48.4082–8, 48.4082–9 and 48.4082–10

are added to read as follows:

§48.4082–6 Kerosene; treatment as

diesel fuel in certain cases.

[The text of this proposed section is the

same as the text of §48.4082–6T published in T.D. 8774.]

§48.4082–7 Kerosene; notice required

with respect to dyed kerosene.

[The text of this proposed section is the

same as the text of §48.4082–7T published in T.D. 8774.]

1998–30 I.R.B.

§48.4082–8 Kerosene; exemption for

aviation-grade kerosene.

[The text of this proposed section is the

same as the text of §48.4082–8T published in T.D. 8774.]

§48.4082–9 Kerosene; exemption from

non-fuel feedstock purposes.

[The text of this proposed section is the

same as the text of §48.4082–9T published in T.D. 8774.]

§48.4082–10 Kerosene; additional

exemption from floor stocks tax.

[The text of this proposed section is the

same as the text of §48.4082–10T published in T.D. 8774.]

Par. 5. Section 48.4091-3 is added to

read as follows:

§48.4091–3 Aviation fuel; conditions to

allowance of refunds of aviation fuel tax

under section 4091(d).

[The text of this proposed section is the

same as the text of §48.4091–3T published in T.D. 8774.]

Par. 6. Section 48.4101–2 is amended by

adding paragraph (a)(4) to read as follows:

§48.4101–2 Information reporting.

(a) * * *

(4) Registered aviation fuel producers.

[The text of this proposed paragraph is

the same as the text of §48.4101–2T(a)(4)

published in T.D. 8774.]

Par. 7. Section 48.4101–3 is added to

read as follows:

§48.4101–3 Registration; special rules

for kerosene.

[The text of this proposed section is the

same as the text of §48.4101–3T published in T.D. 8774.]

Par. 8. Sections 48.6427–10 and

48.6427–11 are added to read as follows:

§48.6427–10 Claims with respect to

kerosene.

[The text of this proposed section is the

same as the text of §48.6427–10T published in T.D. 8774.]

§48.6427–11 Special rules for claims by

registered ultimate vendors of kerosene

(blocked pump).

[The text of this proposed section is the

same as the text of §48.6427-11T published in T.D. 8774.]

Michael P. Dolan,

Deputy Commissioner of

Internal Revenue.

(Filed by the Office of the Federal Register on June

26, 1998, 2:02 p.m., and published in the issue of the

Federal Register for July 1, 1998, 63 F.R. 35893)

July 27, 1998

Part IV. Items of General Interest

Foreign Liquidations and

Reorganizations; Amendment

Announcement 98–69

AGENCY: Internal Revenue Service

(IRS), Treasury

ACTION: Amendment to notice of proposed rulemaking.

SUMMARY: This document removes

from an existing (1991) notice of proposed rulemaking [INTL–54–91;

INTL–178–86, 1991–2 C.B. 1070] the

special (August 26, 1991) effective date

rule for the definition of the all earnings

and profits amount. The IRS and the

Treasury Department believe that issues

regarding the all earnings and profits

amount should be studied; thus, when

final regulations under section 367(b) are

issued with respect to the all earnings and

profits amount, such regulations will have

a prospective effective date. This modification may affect domestic corporations

in connection with an acquisition of a foreign corporation in a liquidation described in section 332 or in an asset acquisition described in section 368(a)(1)).

DATES: Written comments must be received by September 17, 1998.

ADDRESSES: Send submissions to:

CC:DOM:CORP:R (REG–209035–86),

Room 5228, Internal Revenue Service,

POB 7604, Ben Franklin Station, Washington, DC 20044. In the alternative, submissions may be hand delivered between

the hours of 8 a.m. and 5 p.m. to:

CC:DOM:CORP:R (REG–209035–86),

Courier’s Desk, Internal Revenue Service, 1111 Constitution Ave., NW, Washington, DC.

FOR FURTHER INFORMATION CONTACT: Philip L. Tretiak at (202) 6223860 (not a toll-free call).

SUPPLEMENTARY INFORMATION:

Background

Section 367(b) was enacted in its current form by the Tax Reform Act of 1976.

On December 27, 1977, proposed and

temporary regulations §§7.367(b)–1

through 7.367(b)–12 were adopted (T.D.

July 27, 1998

7530, 1978–1 C.B. 92). Prior to the issuance of a notice of proposed rulemaking in 1991 (the 1991 proposed regulations), discussed below, the regulations

under section 367(b) were amended on

several occasions. The 1991 proposed

regulations, which were published in the

Federal Register on August 26, 1991 (56

F.R. 41993), propose to completely revise

the regulations under section 367(b), as

well as the rules under section 367(a) with

respect to certain transfers of stock or securities by U.S. persons to foreign corporations.

Section 1.367(b)–6(a) of the proposed

regulations provides that the rules contained in the section 367(b) proposed regulations will be effective for exchanges

that occur on or after the date that is 30

days after final regulations are published.

However, an exception to the general effective date provides that §1.367(b)–2(d)

(relating to the definition and computation of the “all earnings and profits

amount”) is effective for exchanges that

occur on or after August 26, 1991. T.D.

8770, a package of final regulations, published in 1998–27 I.R.B. 4, contains final

rules with respect to the section 367(a)

portion of the 1991 proposed regulations

(to the extent that such rules were not previously finalized) and final rules with respect to the section 367(b) portion of the

1991 proposed regulations, but generally

only to the extent that a particular transaction is subject to both sections 367(a) and

(b). The final regulations do not address

the all earnings and profits amount.

The IRS and the Treasury Department

believe that issues regarding the all earnings and profits amount should be studied

before final regulations are promulgated.

Moreover, the IRS and the Treasury Department believe that the final regulations

concerning the all earnings and profits

amount should not be subject to a special

effective date. Thus, this notice of proposed rulemaking removes from the 1991

proposed regulations the special (August

26, 1991) effective date rule for the definition of the all earnings and profits

amount. When final regulations under

section 367(b) are issued with respect to

the all earnings and profits amount, such

regulations will have a prospective effective date.

Special Analysis

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 has

also been determined that this regulation

does not have a significant impact on

small entities because this regulation,

which only contains a limited effective

date rule, impacts only U.S. corporations

with investments in foreign corporations.

Thus, the Regulatory Flexibility Act (5

U.S.C. chapter 6) does not apply to these

regulations, and therefore, a Regulatory

Flexibility Analysis 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 its

impact on small business.

Comments

Before these proposed regulations are

adopted as final regulations, consideration

will be given to any written comments (a

signed original and eight (8) copies) that

are submitted timely to the Internal Revenue Service. All comments will be available for public inspection and copying.

Drafting Information

The principal author of these proposed

regulations is Philip L. Tretiak of the Office of Associate Chief Counsel (International), IRS. However, other personnel

from the IRS and the Treasury Department participated in their development.

* * * * *

Proposed Amendments to the Regulations

Accordingly, 26 CFR part 1 is proposed to be amended as follows:

PART 1—INCOME TAXES

Paragraph 1. The authority citation for

part 1 continues to read in part as follows:

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

§1.367(b)–6 [Amended]

Par. 2. Section 1.367(b)–6, as proposed

to be added on Monday, August 26, 1991

1998–30 I.R.B.

(56 F.R. 42015), is amended by removing

the last sentence of paragraph (a).

Michael P. Dolan,

Deputy Commissioner of

Internal Revenue.

(Filed by the Office of the Federal Register on June

18, 1998, 8:45 a.m., and published in the issue of the

Federal Register for June 19, 1998, 63 F.R. 33595)

Deletions from Cumulative List

of Organizations Contributions

to Which Are Deductible Under

Section 170 of the Code

Announcement 98–70

The names of organizations that no

longer qualify as organizations described

in section 170(c)(2) of the Internal Revenue Code of 1986 are listed below.

Generally, the Service will not disallow

deductions for contributions made to a

listed organization on or before the date

of announcement in the Internal Revenue

Bulletin that an organization no longer

qualifies. However, the Service is not

precluded from disallowing a deduction

for any contributions made after an organization ceases to qualify under section

170(c)(2) if the organization has not

timely filed a suit for declaratory judgment under section 7428 and if the contributor (1) had knowledge of the revocation of the ruling or determination letter,

(2) was aware that such revocation was

imminent, or (3) was in part responsible

for or was aware of the activities or omissions of the organization that brought

about this revocation.

If on the other hand a suit for declaratory judgment has been timely filed, contributions from individuals and organizations described in section 170(c)(2) that

are otherwise allowable will continue to

be deductible. Protection under section

7428(c) would begin on July 27, 1998,

and would end on the date the court first

determines that the organization is not described in section 170(c)(2) as more particularly set forth in section 7428(c)(1).

For individual contributors, the maximum deduction protected is $1,000, with

a husband and wife treated as one contributor. This benefit is not extended to

any individual who was responsible, in

whole or in part, for the acts or omissions

1998–30 I.R.B.

of the organization that were the basis for

revocation.

Larry Lee Ministries

Rowlett, TX

Share, Inc.

Chicago, IL

Foundations Status of Certain

Organizations

Announcement 98–71

The following organizations have

failed to establish or have been unable to

maintain their status as public charities or

as operating foundations. Accordingly,

grantors and contributors may not, after

this date, rely on previous rulings or designations in the Cumulative List of Organizations (Publication 78), or on the presumption arising from the filing of notices

under section 508(b) of the Code. This

listing does not indicate that the organizations have lost their status as organizations described in section 501(c)(3), eligible to receive deductible contributions.

Former Public Charities. The following

organizations (which have been treated as

organizations that are not private foundations described in section 509(a) of the

Code) are now classified as private foundations:

Oconee Greenway Organization Inc.,

Athens, GA

Ohio Emergency Response Center,

London, OH

Oklahoma Coalition for Victims Rights

Inc., Tulsa, OK

Old Erie Community Development

Corporation, Evansville, IN

On the Daddy Track Inc., New

Berlinville, PA

Open Hands Ministry Inc., Buford,

Operation Save the Children Inc.,

San Antonio, TX

Operation S T R E E T S Inc.,

Jacksonville, FL

Orangedale Parent-Teacher-Student

Organization, Phoenix, AZ

Orchid Association, Middletown, OH

Orland Park Pioneer Wrestling Boosters

Association, Orland Park, IL

Orleans Community Housing

Development Corporation, Metairie,

Oromo Community in San Diego, San

Diego, CA

Owensboro Rotary Club Foundation Inc.,

Owensboro, KY

Pak Impak, Doylestown, PA

Pan African Federation Organization Inc.,

Philadelphia, PA

Parent Teacher Organization of Benvenue

Elementary School, Rocky Mount, NC

Parents Reaching Out of Davidson

County, Lexington, NC

Parents Teach Parents English as a

Second Language Inc., Saddle River,

Park City Youth Coalition I Incorporated,

Park City, UT

Park Falls Area Community Foundation

Inc., Park Falls, WI

Partners for Independence Inc., Piney

Flats, TN

Partnerships in Building Illinois, Peoria,

Pathways Inc., Reidsville, NC

Patricia Stevens College Foundation Inc.,

St. Louis, MO

P A W Safety Charities, Dallas, TX

Peachtree City Concert Band Inc.,

Peachtree City, GA

Pebbles of Faith, Inc., Bolivar, MO

Pennsylvania Advisory Committee on

Alcohol Drugs and Disabilities,

Philadelphia, PA

People Reaching Out Center, Chicago, IL

Perrine Baseball and Softball

Association, Miami, FL

Personal Development Institute Inc.,

Tucson, AZ

Phoenix Center Association, Phoenix,

Physicians for a Violence-Free Society,

Dallas, TX

Pikes Peak Festival of Learning Inc.,

Colorado Springs, CO

Pines of McCormick, McCormick, SC

Pioneering Black America Foundation,

Wentzville, MO

Pittsburgh Community Reinvestment

Group, Pittsburgh, PA

Plexus, Richmond, VA

Plymouth Housing Alliance, Plymouth,

Ponte Vedra-Palm Valley Athletic

Association Inc., Ponte Verda Beach,

Posey International Center for the Study

of Traditional Knowledge, Henderson,

July 27, 1998

Present Time Dream Factory, Santa Fe,

Presentation Catholic Church

Community in Action Inc., Chicago, IL

Prestonburg-Floyd County Public

Properties Corporation, Prestonburg,

Prevention Place Inc., Forest City, NC

Probationers Educational Growth

Advisory Council Inc., New Port

Richey, FL

Professional Ski Instructors of AmericaIntermountain Division, Salt Lake

City, UT

Project Goodwill Inc., Columbus, OH

Project Help of West Orlando, Orlando,

Project S T A R S, Baytown, TX

Project Training Education and

Motivation Inc., Beavercreek, OH

Pyramid Recovery Center, Memphis, TN

Quakertown Community Hospital

Medical Foundation, Bethlehem, PA

Quantum Testing and Research Institute,

Park Forest, IL

Raphael Heights Homes Inc., Phila, PA

Reality Theatre Company, Albuquerque,

Red Path Inc., Flagstaff, AZ

Renaissance Economic Development

Project of Park Heights Inc.,

Baltimore, MD

Resource Reutilization Network Inc.,

Leonia, NJ

Resourcemobile Inc., Miami, FL

Resurrection Catholic School

Endowment Fund, Lakeland, FL

Rev. Willie L. Jordan Community Service

Center Inc., Harvey, IL

Rio Vista Equipo Medico Inc.,

Shrewsbury, NJ

River Cities Boy Choir, Parkersburg, WV

Riverfront Musical Festival Inc., Tampa,

Riverside Development Corporation Inc.,

Minneapolis, MN

River View Health Systems Inc.,

Erdenheim, PA

Robert Abbott Middle School PTO,

Waukegan, IL

Robert E. Willis Sr. Gift Book Program

Inc., Murfreesboro, TN

Ros Inc., Birmingham, AL

Rotary Club of Niles Morton Grove

Charitable Foundation, Niles, IL

R-USA, Evergreen, CO

Safe Campuses Now Inc., Athens, GA

Safe Talk Inc., Littlestown, PA

July 27, 1998

Salvation Army Reno Residences Inc.,

Rancho Palos Verdes, CA

Satellite Touch Down Club Inc., Satellite

Beach, FL

Scat Association, Middletown, OH

Scenic Associates, Wilmington, NC

Scholastic Art Awards of Central Indiana

Inc., Indianapolis, IN

Science Exposures Inc., Rochester, MN

Seneca Falls, Chicago, IL

Senior Citizen Housing Alliance,

Longmont, CO

Share Arkansas, Little Rock, AR

Sids Alliance of Illinois Inc., Glenview,

Singing Americans of Stanley County

North Carolina Inc., Badin, NC

Singles Helping Others Inc., Princeton,

Sluggers Forever Inc., New Ulm, MN

Smith College Class of 1988,

San Antonio, TX

Snyder Educational Enrichment

Foundation, Snyder, OK

Society for Chronic Diseases,

Minneapolis, MN

South Beach Film Festival Inc., North

Miami Beach, FL

South George Street Community

Partnership, York, PA

South Gulf Basketball Officials

Association Inc., Lehigh Acres, FL

Southeast Asian American Community

Organization LTD, Des Moines, IA

Southeastern Minnesota High School

Honors Choir, Byron, MN

Southern Nursing Research Society,

Columbia, SC

Southern Orthodox Radio

Communications Enterprises Source,

Miami, FL

Southwest Museum Foundation Inc.,

Mesa, AZ

Sparta White County Citizens for the

Arts, Sparta, TN

Sprague High School Choir Boosters

Foundation Inc., Salem, OR

Springview Substance Abuse & Outreach

Program, Chat, TN

St. Landry High School Rodeo

Association, Opelousas, LA

St. Marthas Housing II Inc., Sarasota, FL

St. Paul Midway Lions Club Foundation

Inc., W. St. Paul, MN

St. Thomas All Stars Steel Band,

St. Thomas, VI

Stapleton Coyote Booster Club,

Rio Rancho, NM

Stephens Evangelistic Association, Inc.,

Seagoville, TX

Stop Sudden Infant Death Syndrome

Minnesota, Cottage Grove, MN

Stoughton Rotary Special Projects

Foundation Inc., Stoughton, WI

Summit County Rotary Foundation,

Beckenridge, CO

Summit Educational Ass. Inc., New

Berlin, WI

Super Leaders Incorporated, Washington,

Sussex County Foundation for Special

Needs Inc., Sparta, NJ

Teacher Education Foundation, Baton

Rouge, LA

Teamster Disaster Relief Fund,

Washington, DC

Teen Reach Corporation, Crestwood, IL

Teens Educators Moms Pops

Organization Tempo of Lakeland,

Lakeland, FL

Tendu Inc., Houston, TX

Tennessee Art Education Association,

Waverly, TN

Tennessee Early Intervention Network

for Children with Disabilities,

Nashville, TN

Terrapin Theatre, Chicago, IL

Tewsbury Athletic Association Inc.,

Califon, NJ

Thacker Avenue Elementary PTO,

Kissimmee, FL

The D. Association for Youth, Seattle,

Thirty One Cuozzo St. Inc., Belleville,

3-Dimensional Recovery Services Inc.,

Oklahoma City, OK

311 Main Street, Carnegie, PA

Thunderbird Clubhouse Board Inc.,

Norman, OK

Tight & Shiny Theater Productions,

Chicago, IL

Top of Florida Soccer Club Inc.,

Tallahessee, FL

Topeka Teens Making a Difference Inc.,

Topeka, KS

Tow Operators Working to Eliminate

Drunk Driving Inc., Greencastle, IN

Towncreek Vision Corp., Leland, NC

Transistional Units Assisting Mankind,

Houston, TX

Trautwein School Mothers Club of the

Mehlville School District, St. Louis,

Trees for Memphis Incorporated,

Germantown, TN

1998–30 I.R.B.

Trenton Park Neighborhood Corporation,

Washington, DC

Trinity Family Center, Lancaster, PA

Tulsa Youth Hockey Association, Tulsa,

Turner Jackson Memorial Fund Inc.,

Trenton, NJ

Tyler Home Health Services,

Tunkhannock, PA

U-Care Inc., Milwaukee, WI

United Black Fund of Prince Georges

County Maryland Inc., Hyattsville,

United Sponsors Society, Sicklerville, NJ

United States Driving Foundation, Inc.,

Annapolis, MD

Unity Hospice Care Inc., Morgantown,

Unitversity of Minnesota M. Club

Foundation, St. Louis, MN

Up on the Mountain Inc., Signal

Mountain, TN

Up With Down Syndrome Inc.,

Columbus, GA

Uplift Recovery Home Inc., Chicago, IL

Upper Valley Association for the

Education of Young Children, Piqua,

Uptown Lenoir Heritage Association Inc.,

Lenoir, NC

Utah Chamber Artists, Midvale, UT

Veterans & Community Outreach

Foundation, Flowery Branch, GA

Veterans Memorial Park Monument

Foundation Inc., Pensacola, FL

Veterans Self Help Group Foundation,

Flint, MI

Vetter Foundation, Omaha, NE

Vicki Popdan Foundation, Gaithersburg,

1998–30 I.R.B.

Victim Sensitive Intervention Program,

Chicago, IL

Victory Through L O V E Inc., Deland,

Village Conservancy Inc., Cashiers, NC

Virginia Gay Hospital, Vinton, IA

Visually Impaired-Blind Support Training

and Assistance Group, Blythe, CA

VJS Inc., Seneca, PA

Volunteer Action Center of Indian River

County Inc., Vero Beach, FL

Volunteer Council for the Arizona Dept.

of Youth Treatment and Rehabilitation,

Phoenix, AZ

Walk Worthy Inc., Altamonte Springs, FL

Wall St. Danceworks Inc., Asheville, NC

War Casualties Memorial Association

Inc., Phenix City, AL

Ward Family Foundation Inc., Chicago,

Warren Police Drug Abuse Resistance

Education D A R E Inc., Warren, MI

Washington Action Line, New Orleans,

Wayzata Womens Choir, Wayzata, MN

Weber Human Services, Ogden, UT

Well-Spring, Allentown, PA

Wellspring Ministries, Whitehall, PA

Wesley Agape House Inc., Alexandria,

West Cecil B. Moore Community

Corporation, Philadelphia, PA

West Central Illinois Center for

Independent Living, Quincy, IL

West Mesa High School Mustang

Football Boosters, Albuquerque, NM

West Orange High School Foundation

Inc., Windermere, FL

West Tallahatchie Day Care Inc., Webb,

West Tennessee Cares, Jackson, TN

Western States Conference for Pharmacy

Residents Fellowships, Stockton, CA

Westmoreland Chodo Inc., Latrobe, PA

Westmoreland Human Services Inc.,

Greensburg, PA

Westpine Middle School Parent Teacher

Organization, Sunrise, FL

Whitestone Corporation, Lumberton, NJ

Wilson County Transportation Service

Inc., Wilson, NC

Windsor Freer Parents Association,

Imperial, MO

Winstanley-Industry Park Neighborhood

Organization, East St. Louis, IL

With Love Foundation Inc., Houston, TX

Wives Clubs Thrift Shop, Great Falls, MT

World Medical Relief, Geneva, IL

Wyoming Agricultural Leadership

Council, Cheyenne, WY

Yacai Inc., Baltimore, MD

Yale Hospital Properites Inc., Yale, MI

Young Virtuosos International, Dallas,

Youth Sports Association, Long Beach,

If an organization listed above submits

information that warrants the renewal of

its classification as a public charity or as a

private operating foundation, the Internal

Revenue Service will issue a ruling or determination letter with the revised classification as to foundation status. Grantors

and contributors may thereafter rely upon

such ruling or determination letter as provided in section 1.509(a)–7 of the Income

Tax Regulations. It is not the practice of

the Service to announce such revised classification of foundation status in the Internal Revenue Bulletin.

July 27, 1998

Definition of Terms

Revenue rulings and revenue procedures

(hereinafter referred to as “rulings”) that

have an effect on previous rulings use the

following defined terms to describe the

effect:

Amplified describes a situation where

no change is being made in a prior published position, but the prior position is

being extended to apply to a variation of

the fact situation set forth therein. Thus,

if an earlier ruling held that a principle

applied to A, and the new ruling holds

that the same principle also applies to B,

the earlier ruling is amplified. (Compare

with modified, below).

Clarified is used in those instances

where the language in a prior ruling is

being made clear because the language

has caused, or may cause, some confusion. It is not used where a position in a

prior ruling is being changed.

Distinguished describes a situation

where a ruling mentions a previously

published ruling and points out an essential difference between them.

Modified is used where the substance

of a previously published position is

being changed. Thus, if a prior ruling

held that a principle applied to A but not

to B, and the new ruling holds that it ap-

plies to both A and B, the prior ruling is

modified because it corrects a published

position. (Compare with amplified and

clarified, above).

Obsoleted describes a previously published ruling that is not considered determinative with respect to future transactions. This term is most commonly used

in a ruling that lists previously published

rulings that are obsoleted because of

changes in law or regulations. A ruling

may also be obsoleted because the substance has been included in regulations

subsequently adopted.

Revoked describes situations where the

position in the previously published ruling is not correct and the correct position

is being stated in the new ruling.

Superseded describes a situation where

the new ruling does nothing more than

restate the substance and situation of a

previously published ruling (or rulings).

Thus, the term is used to republish under

the 1986 Code and regulations the same

position published under the 1939 Code

and regulations. The term is also used

when it is desired to republish in a single

ruling a series of situations, names, etc.,

that were previously published over a period of time in separate rulings. If the

new ruling does more than restate the

substance of a prior ruling, a combination

of terms is used. For example, modified

and superseded describes a situation

where the substance of a previously published ruling is being changed in part and

is continued without change in part and it

is desired to restate the valid portion of

the previously published ruling in a new

ruling that is self contained. In this case

the previously published ruling is first

modified and then, as modified, is superseded.

Supplemented is used in situations in

which a list, such as a list of the names of

countries, is published in a ruling and

that list is expanded by adding further

names in subsequent rulings. After the

original ruling has been supplemented

several times, a new ruling may be published that includes the list in the original

ruling and the additions, and supersedes

all prior rulings in the series.

Suspended is used in rare situations to

show that the previous published rulings

will not be applied pending some future

action such as the issuance of new or

amended regulations, the outcome of

cases in litigation, or the outcome of a

Service study.

Abbreviations

E.O.—Executive Order.

ER—Employer.

ERISA—Employee Retirement Income Security Act.

EX—Executor.

F—Fiduciary.

FC—Foreign Country.

FICA—Federal Insurance Contribution Act.

FISC—Foreign International Sales Company.

FPH—Foreign Personal Holding Company.

F.R.—Federal Register.

FUTA—Federal Unemployment Tax Act.

FX—Foreign Corporation.

G.C.M.—Chief Counsel’s Memorandum.

GE—Grantee.

GP—General Partner.

GR—Grantor.

IC—Insurance Company.

I.R.B.—Internal Revenue Bulletin.

LE—Lessee.

LP—Limited Partner.

LR—Lessor.

M—Minor.

Nonacq.—Nonacquiescence.

O—Organization.

P—Parent Corporation.

PHC—Personal Holding Company.

PO—Possession of the U.S.

PR—Partner.

PRS—Partnership.

PTE—Prohibited Transaction Exemption.

Pub. L.—Public Law.

REIT—Real Estate Investment Trust.

Rev. Proc.—Revenue Procedure.

Rev. Rul.—Revenue Ruling.

S—Subsidiary.

S.P.R.—Statements of Procedral Rules.

Stat.—Statutes at Large.

T—Target Corporation.

T.C.—Tax Court.

T.D.—Treasury Decision.

TFE—Transferee.

TFR—Transferor.

T.I.R.—Technical Information Release.

TP—Taxpayer.

TR—Trust.

TT—Trustee.

U.S.C.—United States Code.

X—Corporation.

Y—Corporation.

Z—Corporation.

The following abbreviations in current use and formerly used will appear in material published in the

Bulletin.

A—Individual.

Acq.—Acquiescence.

B—Individual.

BE—Beneficiary.

BK—Bank.

B.T.A.—Board of Tax Appeals.

C.—Individual.

C.B.—Cumulative Bulletin.

CFR—Code of Federal Regulations.

CI—City.

COOP—Cooperative.

Ct.D.—Court Decision.

CY—County.

D—Decedent.

DC—Dummy Corporation.

DE—Donee.

Del. Order—Delegation Order.

DISC—Domestic International Sales Corporation.

DR—Donor.

E—Estate.

EE—Employee.

July 27, 1998

1998–30 I.R.B.

Numerical Finding List1

Bulletin 1998–29

Announcements:

98–62, 1998–29 I.R.B. 13

98–68, 1998–29 I.R.B. 14

Notices:

98–36, 1998–29 I.R.B. 8

Proposed Regulations:

REG–104641–97, 1998–29 I.R.B. 9

REG–110403–98, 1998–29 I.R.B. 11

REG–116608–97, 1998–29 I.R.B. 12

Revenue Procedures:

98–43, 1998–29 I.R.B. 8

Treasury Decisions:

8771, 1998–29 I.R.B. 6

8773, 1998–29 I.R.B. 4

1 A cumulative list of all revenue rulings, revenue

procedures, Treasury decisions, etc., published in

Internal Revenue Bulletins 1998–1 through 1998–28

will be found in Internal Revenue Bulletin 1998–29,

dated July 20, 1998.

1998–30 I.R.B.

July 27, 1998

Finding List of Current Action on

Previously Published Items1

Bulletin 1998–29

*Denotes entry since last publication

1 A cumulative finding list for previously published

items mentioned in Internal Revenue Bulletins

1998–1 through 1998–28 will be found in Internal

Revenue Bulletin 1998–29, dated July 20, 1998.

July 27, 1998

1998–30 I.R.B.

INTERNAL REVENUE BULLETIN

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