Bulletin No. 2022–28
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HIGHLIGHTS
OF THIS ISSUE
Bulletin No. 2022–28
July 11, 2022
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.
ADMINISTRATIVE, ESTATE TAX
EMPLOYEE PLANS
REG-130975-08, page 71.
These proposed regulations propose rules on the
proper use of present-value principles in determining
the amount deductible under section 2053 of the Internal Revenue Code (Code). In addition, the proposed
regulations propose rules under section 2053 of the
Code on the deductibility of interest expense and the
substantiation requirements for the value of certain
claims against an estate. Finally, the proposed regulations propose rules under section 2053 of the Code
on the deductibility of amounts paid under a decedent’s
personal guarantee. The proposed regulations also
request public comment and provide notice of a public
hearing on the regulations.
Notice 2022-29, page 66.
This notice sets forth updates on the corporate bond
monthly yield curve, the corresponding spot segment
rates for June 2022 used under § 417(e)(3)(D), the
24-month average segment rates applicable for June
2022, and the 30-year Treasury rates, as reflected by
the application of § 430(h)(2)(C)(iv).
Finding Lists begin on page ii.
INCOME TAX
Notice 2022-30, page 70.
This Notice announces that the Treasury Department
and the IRS intend to amend the regulations under sections 59A and 6038A to defer the applicability date
of certain provisions of the regulations relating to the
reporting of qualified derivative payments until taxable
years beginning on or after January 1, 2025.
The IRS Mission
Provide America’s taxpayers top-quality service by helping
them understand and meet their tax responsibilities and
enforce the law with integrity and fairness to all.
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.
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.
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.
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 procedures 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.
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 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).
Part IV.—Items of General Interest.
This part includes notices of proposed rulemakings, disbarment and suspension lists, and announcements.
The last 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 last Bulletin of each semiannual period.
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.
July 11, 2022
Bulletin No. 2022–28
Part III
Administrative,
Miscellaneous, and
Procedural
YIELD CURVE AND SEGMENT
RATES
Update for Weighted
Average Interest Rates,
Yield Curves, and Segment
Rates
Notice 2022-29
This notice provides guidance on the
corporate bond monthly yield curve, the
corresponding spot segment rates used
under § 417(e)(3), and the 24-month
average segment rates under § 430(h)(2)
of the Internal Revenue Code. In addition, this notice provides guidance as
to the interest rate on 30-year Treasury
securities under § 417(e)(3)(A)(ii)(II)
as in effect for plan years beginning
before 2008 and the 30-year Treasury weighted average rate under
§ 431(c)(6)(E)(ii)(I).
Applicable Month
June 2022
Section 430 specifies the minimum
funding requirements that apply to single-employer plans (except for CSEC plans
under § 414(y)) pursuant to § 412. Section
430(h)(2) specifies the interest rates that
must be used to determine a plan’s target
normal cost and funding target. Under
this provision, present value is generally
determined using three 24-month average
interest rates (“segment rates”), each of
which applies to cash flows during specified periods. To the extent provided under
§ 430(h)(2)(C)(iv), these segment rates
are adjusted by the applicable percentage
of the 25-year average segment rates for
the period ending September 30 of the
year preceding the calendar year in which
the plan year begins.1 However, an election may be made under § 430(h)(2)(D)
(ii) to use the monthly yield curve in place
of the segment rates.
Notice 2007-81, 2007-44 I.R.B. 899,
provides guidelines for determining the
monthly corporate bond yield curve, and
the 24-month average corporate bond
segment rates used to compute the target
normal cost and the funding target. Consistent with the methodology specified in
Notice 2007-81, the monthly corporate
bond yield curve derived from May 2022
data is in Table 2022-5 at the end of this
notice. The spot first, second, and third
segment rates for the month of May 2022
are, respectively, 3.23, 4.59, and 4.69.
The 24-month average segment rates
determined
under
§ 430(h)(2)(C)(i)
through (iii) must be adjusted pursuant to
§ 430(h)(2)(C)(iv) to be within the applicable minimum and maximum percentages of the corresponding 25-year average segment rates. The 25-year average
segment rates for plan years beginning in
2021 and 2022 were published in Notice
2020-72, 2020-40 I.R.B. 789, and Notice
2021-54, 2021-41 I.R.B. 457, respectively.
24-MONTH AVERAGE CORPORATE
BOND SEGMENT RATES
The three 24-month average corporate
bond segment rates applicable for June
2022 without adjustment for the 25-year
average segment rate limits are as follows:
24-Month Average Segment Rates Without 25-Year Average Adjustment
First Segment
Second Segment
Third Segment
1.02
2.80
3.38
25-YEAR AVERAGE SEGMENT
RATES
Section 9706(a) of the American Rescue Plan Act of 2021, Pub. L. 117-2 (the
ARP), which was enacted on March 11,
2021, changed the 25-year average segment rates and the applicable minimum
and maximum percentages used under
§ 430(h)(2)(C)(iv) of the Code to adjust
the 24-month average segment rates.2 Prior
to this change, the applicable minimum
and maximum percentages were 85%
and 115% for a plan year beginning in
2021, and 80% and 120% for a plan year
beginning in 2022, respectively. After this
change, the applicable minimum and maximum percentages are 95% and 105% for
a plan year beginning in 2021 or 2022.
In addition, pursuant to this change, any
25-year average segment rate that is less
than 5% is deemed to be 5%.3
Pursuant to § 9706(c)(1) of the ARP,
these changes apply with respect to plan
years beginning on or after January 1,
2020. However, § 9706(c)(2) of the ARP
provides that a plan sponsor may elect
not to have these changes apply to any
plan year beginning before January 1,
2022.4
The adjusted 24-month average segment rates set forth in the chart below
reflect § 430(h)(2)(C)(iv) of the Code
as amended by § 9706(a) of the ARP.
These adjusted 24-month average segment rates apply only for plan years for
Pursuant to § 433(h)(3)(A), the third segment rate determined under § 430(h)(2)(C) is used to determine the current liability of a CSEC plan (which is used to calculate the minimum amount
of the full funding limitation under § 433(c)(7)(C)).
2
Section 80602 of the Infrastructure Investment and Jobs Act, Pub. L. 117-58, makes further changes to the time periods for which specified applicable minimum and maximum percentages
apply.
3
Pursuant to this change, the 25-year averages of the first segment rate for 2021 and 2022 are increased to 5.00% because those 25-year averages as originally published are below 5.00%.
4
This election may be made either for all purposes for which the amendments under § 9706 of the ARP apply or solely for purposes of determining the adjusted funding target attainment
percentage under § 436 of the Code for the plan year.
1
July 11, 2022
66
Bulletin No. 2022–28
which an election under § 9706(c)(2) of
the ARP is not in effect. For a plan year
for which such an election does not apply,
For Plan Years
Beginning In
the 24-month averages applicable for June
2022, adjusted to be within the applicable
minimum and maximum percentages of
the corresponding 25-year average segment rates in accordance with § 430(h)(2)
(C)(iv) of the Code, are as follows:
Adjusted 24-Month Average Segment Rates
Applicable
First
Second
Month
Segment
Segment
Third
Segment
2021
June 2022
4.75
5.36
6.11
2022
June 2022
4.75
5.18
5.92
The adjusted 24-month average segment rates set forth in the chart below do
not reflect the changes to § 430(h)(2)(C)
(iv) of the Code made by § 9706(a) of the
ARP. These adjusted 24-month average
For Plan Years
Beginning In
2021
segment rates apply only for plan years
for which an election under § 9706(c)(2)
of the ARP is in effect. For a plan year
for which such an election applies, the
24-month averages applicable for June
2022, adjusted to be within the applicable
minimum and maximum percentages of
the corresponding 25-year average segment rates in accordance with § 430(h)(2)
(C)(iv) of the Code, are as follows:
Pre-ARP Adjusted 24-Month Average Segment Rates
Applicable
First
Second
Month
Segment
Segment
June 2022
30-YEAR TREASURY SECURITIES
INTEREST RATES
3.32
Third
Segment
4.79
5.47
Section 431 specifies the minimum
funding requirements that apply to multiemployer plans pursuant to § 412. Section
431(c)(6)(B) specifies a minimum amount
for the full-funding limitation described in
§ 431(c)(6)(A), based on the plan’s current
liability. Section 431(c)(6)(E)(ii)(I) provides that the interest rate used to calculate current liability for this purpose must
be no more than 5 percent above and no
more than 10 percent below the weighted
average of the rates of interest on 30-year
Treasury securities during the four-year
period ending on the last day before the
beginning of the plan year. Notice 88-73,
1988-2 C.B. 383, provides guidelines for
determining the weighted average interest
rate. The rate of interest on 30-year Treasury securities for May 2022 is 3.06 percent. The Service determined this rate as
the average of the daily determinations of
For Plan Years
Beginning In
Treasury Weighted Average Rates
30-Year Treasury
Weighted Average
Permissible Range
90% to 105%
June 2022
2.13
1.92 to 2.23
under § 417(e)(3)(D) are segment rates
computed without regard to a 24-month
average. Notice 2007-81 provides guidelines for determining the minimum
present value segment rates. Pursuant to
that notice, the minimum present value
segment rates determined for May 2022
are as follows:
MINIMUM PRESENT VALUE
SEGMENT RATES
In general, the applicable interest rates
Month
May 2022
Bulletin No. 2022–28
yield on the 30-year Treasury bond maturing in February 2052 determined each
day through May 11, 2022; and the yield
rate on the 30-year Treasury Bond maturing in May 2052 determined each day for
the balance of the month. For plan years
beginning in June 2022, the weighted
average of the rates of interest on 30-year
Treasury securities and the permissible
range of rates used to calculate current liability are as follows:
Minimum Present Value Segment Rates
First Segment
Second Segment
3.23
4.59
67
Third Segment
4.69
July 11, 2022
DRAFTING INFORMATION
The principal author of this notice is
Tom Morgan of the Office of the Associate Chief Counsel (Employee Benefits,
July 11, 2022
Exempt Organizations, and Employment
Taxes). However, other personnel from
the IRS participated in the development
of this guidance. For further information
regarding this notice, contact Mr. Morgan
68
at 202-317-6700 or Osmundo Bernabe at
626-927-1344 (not toll-free numbers).
Bulletin No. 2022–28
Table 2022-5
Monthly Yield Curve for May 2022
Derived from May 2022 Data
Maturity
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
7.0
7.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12.0
12.5
13.0
13.5
14.0
14.5
15.0
15.5
16.0
16.5
17.0
17.5
18.0
18.5
19.0
19.5
20.0
Yield
2.06
2.51
2.90
3.19
3.39
3.51
3.59
3.65
3.72
3.78
3.85
3.93
4.01
4.09
4.18
4.26
4.34
4.41
4.48
4.54
4.59
4.64
4.68
4.72
4.75
4.77
4.79
4.81
4.82
4.83
4.83
4.83
4.83
4.83
4.83
4.82
4.82
4.81
4.80
4.80
Maturity
20.5
21.0
21.5
22.0
22.5
23.0
23.5
24.0
24.5
25.0
25.5
26.0
26.5
27.0
27.5
28.0
28.5
29.0
29.5
30.0
30.5
31.0
31.5
32.0
32.5
33.0
33.5
34.0
34.5
35.0
35.5
36.0
36.5
37.0
37.5
38.0
38.5
39.0
39.5
40.0
Bulletin No. 2022–28
Yield
4.79
4.78
4.78
4.77
4.76
4.76
4.75
4.75
4.74
4.74
4.73
4.73
4.73
4.72
4.72
4.72
4.71
4.71
4.71
4.71
4.71
4.70
4.70
4.70
4.70
4.70
4.70
4.69
4.69
4.69
4.69
4.69
4.69
4.69
4.68
4.68
4.68
4.68
4.68
4.68
Maturity
40.5
41.0
41.5
42.0
42.5
43.0
43.5
44.0
44.5
45.0
45.5
46.0
46.5
47.0
47.5
48.0
48.5
49.0
49.5
50.0
50.5
51.0
51.5
52.0
52.5
53.0
53.5
54.0
54.5
55.0
55.5
56.0
56.5
57.0
57.5
58.0
58.5
59.0
59.5
60.0
69
Yield
4.68
4.68
4.68
4.67
4.67
4.67
4.67
4.67
4.67
4.67
4.67
4.67
4.67
4.67
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.66
4.65
4.65
4.65
4.65
4.65
4.65
4.65
4.65
4.65
4.65
4.65
4.65
Maturity
60.5
61.0
61.5
62.0
62.5
63.0
63.5
64.0
64.5
65.0
65.5
66.0
66.5
67.0
67.5
68.0
68.5
69.0
69.5
70.0
70.5
71.0
71.5
72.0
72.5
73.0
73.5
74.0
74.5
75.0
75.5
76.0
76.5
77.0
77.5
78.0
78.5
79.0
79.5
80.0
Yield
4.65
4.65
4.65
4.65
4.65
4.65
4.65
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.64
4.63
4.63
4.63
4.63
4.63
Maturity
80.5
81.0
81.5
82.0
82.5
83.0
83.5
84.0
84.5
85.0
85.5
86.0
86.5
87.0
87.5
88.0
88.5
89.0
89.5
90.0
90.5
91.0
91.5
92.0
92.5
93.0
93.5
94.0
94.5
95.0
95.5
96.0
96.5
97.0
97.5
98.0
98.5
99.0
99.5
100.0
Yield
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.63
4.62
July 11, 2022
Section 59A Qualified
Derivative Payments
Reporting Extension
Notice 2022-30
I. PURPOSE
This Notice announces that the Department of the Treasury (“Treasury Department”) and the Internal Revenue Service
(“IRS”) intend to amend the regulations
under sections 59A and 6038A to defer
the applicability date of certain provisions
of the regulations relating to the reporting
of qualified derivative payments (“QDP”)
until taxable years beginning on or after
January 1, 2025.
II. BACKGROUND
On December 6, 2019, the Treasury
Department and the IRS published TD
9885 in the Federal Register (84 FR
66968), which contains final regulations
addressing the base erosion and anti-abuse
tax (“BEAT”) of section 59A (the “2019
final regulations”). The 2019 final regulations generally apply to taxable years
ending on or after December 17, 2018.
The 2019 final regulations included rules
under sections 59A and 6038A addressing
the reporting of QDPs, which are not base
erosion payments.
Under §1.59A-6(b)(2)(i), a payment
does not qualify as a QDP unless the taxpayer reports the information required
July 11, 2022
in §1.6038A-2(b)(7)(ix) for the taxable year. Section 1.6038A-2(b)(7)(ix)
requires a taxpayer subject to the BEAT
to report on Form 8991 the aggregate
amount of QDPs for the taxable year and
make a representation that all payments
satisfy the requirements of §1.59A-6(b)
(2). If a taxpayer fails to satisfy the
reporting requirements of §1.59A-6(b)
(2)(i) with respect to any payments,
§1.59A-6(b)(2)(ii) (the reporting failure
exclusion) provides that those payments
are not eligible for the QDP exception
described in §1.59A-3(b)(3)(ii) and are
base erosion payments unless another
exception applies.
Section 1.6038A-2(b)(7)(ix) applies to
taxable years beginning on or after June
7, 2021. Section 1.6038A-2(g). Before
§1.6038A-2(b)(7)(ix) is applicable (the
“transition period”), a taxpayer is treated
as satisfying the QDP reporting requirements to the extent that the taxpayer
reports the aggregate amount of QDPs
on Form 8991, Schedule A, provided
that the taxpayer reports this amount in
good faith. See §1.59A-6(b)(2)(iv) and
§1.6038A-2(g).
In Notice 2021-36, 2021-26 I.R.B.
1227, the Treasury Department and the
IRS announced the intention to extend
the transition period through taxable years
beginning before January 1, 2023, while
the Treasury Department and the IRS study
the interaction of the QDP exception, the
BEAT netting rule in §1.59A-2(e)(3)(vi),
and the QDP reporting requirements in
§§1.59A-6 and 1.6038A-2(b)(7)(ix). The
Treasury Department and the IRS have
70
not yet issued regulations amending the
applicability date of §1.6038A-2(g). The
Treasury Department and the IRS continue to study these provisions and have
determined that it is appropriate to further
extend the transition period.
III. AMENDED APPLICABILITY
DATE
The Treasury Department and the IRS
intend to amend §1.6038A-2(g) to provide that §1.6038A-2(b)(7)(ix) will apply
to taxable years beginning on or after January 1, 2025. Until §1.6038A-2(b)(7)(ix)
applies, the rules described in §1.59A6(b)(2)(iv) that apply during the transition
period will continue to apply.
IV. TAXPAYER RELIANCE
Taxpayers may rely on the provisions
of this Notice before the issuance of
the amendments to the final regulations
described in section III of this Notice.
V. EFFECT ON OTHER DOCUMENTS
Notice 2021-36 is modified, and as so
modified, is superseded.
VI. DRAFTING INFORMATION
The principal author of this Notice
is Sheila Ramaswamy of the Office
of Associate Chief Counsel (International). For further information regarding
this notice contact Sheila Ramaswamy
at (202) 317-6938 (not a toll-free number).
Bulletin No. 2022–28
Part IV
Notice of Proposed
Rulemaking
Guidance under Section
2053 Regarding Deduction
for Interest Expense and
Amounts Paid under a
Personal Guarantee,
Certain Substantiation
Requirements, and
Applicability of Present
Value Concepts
REG-130975-08
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Notice of proposed rulemaking
and notice of public hearing.
SUMMARY: This document proposes to
amend existing regulations issued under
section 2053 of the Internal Revenue
Code (Code). The proposed regulations
provide guidance on the proper use of
present-value principles in determining the amount deductible by an estate
for funeral expenses, administration
expenses, and certain claims against the
estate. In addition, the proposed regulations provide guidance on the deductibility of interest expense accruing on
tax and penalties owed by an estate, and
interest expense accruing on certain loan
obligations incurred by an estate. The
proposed regulations also amend and
clarify the requirements for substantiating the value of a claim against an
estate that is deductible in certain cases.
Finally, the proposed regulations provide
guidance on the deductibility of amounts
paid under a decedent’s personal guarantee. The proposed regulations will
affect estates of decedents seeking to
deduct funeral expenses, administration
expenses, and/or certain claims against
the estate under section 2053. This document also provides a notice of a public
hearing on these proposed regulations.
Bulletin No. 2022–28
DATES: Electronic or written comments
must be received by September 26, 2022.
The public hearing is being held by teleconference on October 12, 2022, at 10
a.m. EST. Requests to speak and outlines
of topics to be discussed at the public
hearing must be received by September
26, 2022. If no outlines are received by
September 26, 2022, the public hearing
will be cancelled. Requests to attend the
public hearing must be received by 5:00
p.m. EST on October 7, 2022. The telephonic hearing will be made accessible to
people with disabilities. Requests for special assistance during the telephonic hearing must be received by October 6, 2022.
public hearing must also send an email
to publichearings@irs.gov to receive
the telephone number and access code
for the hearing. The subject line of the
email must contain the regulation number
REG-130975-08 and the word ATTEND.
For example, the subject line may say:
Request to ATTEND Hearing for REG130975-08. To request special assistance
during the telephonic hearing, contact
the Publications and Regulations Branch
of the Office of Associate Chief Counsel
(Procedure and Administration) by sending an email to publichearings@irs.gov
(preferred) or by telephone at (202) 3175177 (not a toll-free number).
ADDRESSES: Commenters are strongly
encouraged to submit public comments
electronically. Submit electronic submissions via the Federal eRulemaking Portal
at www.regulations.gov (indicate IRS and
REG-130975-08). Once submitted to the
Federal eRulemaking Portal, comments
cannot be edited or withdrawn. The IRS
expects to have limited personnel available to process comments that are submitted on paper through the mail. The
IRS will publish any comments submitted
electronically and, to the extent practicable, comments submitted on paper to the
public docket. Send paper submissions
to CC:PA:LPD:PR (REG-130975-08),
Room 5205, Internal Revenue Service, PO
Box 7604, Ben Franklin Station, Washington, DC 20044.
For those requesting to speak during
the hearing, send an outline of topic submissions electronically via the Federal
eRulemaking Portal at www.regulations.
gov (indicate IRS and REG-130975-08).
Individuals who want to testify (by
telephone) at the public hearing must send
an email to publichearings@irs.gov to
receive the telephone number and access
code for the hearing. The subject line
of the email must contain the regulation
number REG-130975-08 and the word
TESTIFY. For example, the subject line
may say: Request to TESTIFY at Hearing
for REG-130975-08. The email should
include a copy of the speaker’s public
comments and outline of topics. Individuals who want to attend (by telephone) the
FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, Karlene Lesho or Melissa Liquerman at (202) 317-6859; concerning the
submission of comments, the hearing, or
to be placed on the building access list
to attend the hearing, Regina Johnson at
(202) 317-6901 (not toll-free numbers) or
by sending an email to publichearings@
irs.gov.
71
SUPPLEMENTARY INFORMATION:
Background and Explanation of
Provisions
I. Overview
This document contains proposed
amendments to the Estate Tax Regulations
(26 CFR part 20) under section 2053.
Section 2001(a) imposes a tax on the
transfer of the taxable estate of every decedent who was at death a citizen or resident
of the United States. Section 2051 defines
the taxable estate as the value of the gross
estate less the deductions provided for
in sections 2053 through 2058. Section
2031(a) describes the value of the gross
estate of the decedent as including the
value at the time of the decedent’s death
of all property, real or personal, tangible
or intangible, wherever situated.
Under section 2053(a), for Federal
estate tax purposes, the value of the taxable estate is determined by deducting
from the value of the gross estate the
July 11, 2022
following amounts that are allowable
by the laws of the jurisdiction, whether
within or without the United States,
under which the estate is being administered: (1) funeral expenses, (2) administration expenses, (3) claims against the
estate, and (4) unpaid mortgages on, or
any indebtedness in respect of, property
where the value of the decedent’s interest
therein, undiminished by such mortgage
or indebtedness, is included in the value
of the gross estate.
Final regulations amending the regulations under section 2053 (TD 9468) were
published in the Federal Register (74 FR
53652) on October 20, 2009 (2009 Final
Regulations). The 2009 Final Regulations
generally limit the deduction for claims
and expenses to the amount actually paid
in settlement or satisfaction of that item,
with exceptions for certain ascertainable
amounts, claims against the estate, and
indebtedness. See §20.2053-1(d)(1) and
(4); §20.2053-4(b) and (c); and §20.20537. The 2009 Final Regulations also reserve
§20.2053-1(d)(6) to provide future guidance on the issue of the appropriate
application of present-value principles in
determining the amount deductible under
section 2053. These proposed regulations
address this issue. In addition, these proposed regulations provide or clarify rules
under section 2053 addressing the deductibility of interest expense accruing on
tax and penalties owed by an estate, the
deductibility of interest expense accruing
on certain loan obligations incurred by an
estate, requirements for substantiating the
value of a claim against an estate that is
deductible under §20.2053-4(b) or (c), and
the deductibility of amounts paid under a
decedent’s personal guarantee.
II.Application of Present-Value Principles
to Amount Deductible under Section 2053
A. Issue Background
“Present value” is a widely accepted
principle of accounting for the time value
of money. If a payor can defer paying a
dollar until a later time, the payor can
earn income on that dollar until the date
of payment. The longer a payor can defer
payment, the more income the payor
potentially can earn. Taxpayers, the IRS,
and courts regularly employ present-value
July 11, 2022
principles for valuation and for other
income tax and transfer tax purposes.
See, e.g., section 1274(b), §§1.642(c)-6,
20.7520-1, and 25.2512‑5; Simpson et
al. v. United States, 252 U.S. 547 (1920);
Commissioner v. Estate of Sternberger,
348 U.S. 187 (1955).
The deduction allowable under section
2053 eliminates from taxation under section 2001 that portion of the gross estate
that the estate expends or necessarily will
expend in paying certain expenses and
liabilities of the estate and certain claims
against the estate. The expended portions
of the gross estate do not pass to the decedent’s legatees, beneficiaries, or heirs and,
therefore, are not subject to the estate
tax. The 2009 Final Regulations implement these principles in determining the
amount an estate may deduct for certain
claims and expenses. Section 20.20531(d)(1) generally limits the deduction
under section 2053 for certain claims and
expenses to the total amount actually paid
in settlement or satisfaction of that item.
Section 20.2053-1(d)(2) clarifies that
events occurring after the date of a decedent’s death will be taken into consideration in determining the allowable deduction under section 2053.
Applying present-value principles to
determine the allowable deduction under
section 2053 for payments made or to be
made after an extended period following
a decedent’s death is consistent with the
principles underlying section 2053 and
the approach of the 2009 Final Regulations. By limiting the deduction to the discounted amount of a payment or payments
made or to be made after an extended
period following the decedent’s death, the
gross estate is reduced by a more accurate measure of the amounts not passing
to the heirs and legatees. Accordingly,
the Department of the Treasury (Treasury
Department) and the IRS have determined
that limiting the amount deductible to the
present value of the amounts paid after
an extended post-death period will more
accurately reflect the economic realities of
the transaction, the true economic cost of
that expense or claim, and the amount not
passing to the beneficiaries of the estate.
Moreover, consistent with the 2009 Final
Regulations, this approach treats the date
of payment of the otherwise deductible
expense or claim as a post-death event
72
properly taken into account under section
2053.
Rules applying present-value principles to certain long-term obligations were
provided in proposed regulations (REG143316-03) published in the Federal
Register (72 FR 20080) on April 23, 2007
(2007 Proposed Regulations), which preceded the issuance of the 2009 Final Regulations. Specifically, the 2007 Proposed
Regulations required the computation of
the present value of future payments for
a decedent’s noncontingent recurring obligation, such as a noncontingent recurring
obligation to pay an annuity amount under
a property settlement agreement. See
§20.2053‑4(b)(7)(i) of the 2007 Proposed
Regulations. However, that rule did not
apply to contingent recurring obligations.
Rather, amounts payable for a decedent’s
contingent recurring obligation became
deductible only as amounts were paid by
the estate in satisfaction of the claim and
the amount deductible equaled the dollar
amount actually paid. No computation
of present value factored into the amount
deductible for such obligations. See
§20.2053-4(b)(7)(ii) of the 2007 Proposed
Regulations.
The preamble to the 2009 Final Regulations indicated that the Treasury
Department and the IRS found persuasive criticism of those proposed rules by
commenters suggesting they produced an
inconsistent and inequitable result. The
2009 Final Regulations clarified that the
amount payable pursuant to a decedent’s
noncontingent recurring obligation is
deemed ascertainable with reasonable certainty and, hence, deductible in advance
of payment under the rule in §20.20531(d)(4), while the amount payable pursuant to a decedent’s contingent recurring
obligation is not ascertainable with reasonable certainty and, hence, the amount
deductible is limited to amounts actually
paid by the estate in satisfaction of the
claim. See §20.2053-4(d)(6). However,
the 2009 Final Regulations removed the
present-value limitation applicable only
to noncontingent recurring obligations
and reserved §20.2053-1(d)(6) to provide
future guidance on the issue.
With regard to a decedent’s obligations that satisfy the requirements for
deductibility as described in the preceding
paragraph, whether such obligations are
Bulletin No. 2022–28
recurring or nonrecurring, there is no persuasive technical or policy basis for limiting the application of present-value principles to payments made or to be made
only under noncontingent obligations.
Because discounting the amounts actually
paid or to be paid in the future to determine the present value of the payments
is consistent with the purpose of section
2053 of reducing the gross estate only by
the amounts not passing to the heirs and
legatees, these proposed regulations propose to incorporate present-value principles in determining the amount deductible
under section 2053. The proposed regulations will apply present-value principles consistently to expenses and claims
(whether contingent or noncontingent)
that are deductible under section 2053.
The mechanics of applying present-value
principles to expenses and claims, including expenses and claims that are deductible in advance of payment, are described
in section II.B of this Background and
Explanation of Provisions.
B. Explanation of Provision
The Treasury Department and the IRS
propose to amend the regulations under
section 2053 to incorporate present-value
principles in determining the amount
deductible under section 2053 for claims
and expenses (excluding unpaid mortgages and indebtedness deductible under
§20.2053-7). The Treasury Department
and the IRS recognize, however, that
estates often cannot pay every deductible
claim and expense within a short time
after the decedent’s death and that sound
tax administration should balance the benefit of more accurately determining the
amounts not passing to the beneficiaries
of an estate garnered from applying present-value principles with the administrative burden of applying those principles to
deductible claims and expenses that occur
during a reasonable period of administration of the estate. The Treasury Department and the IRS understand that a significant percentage of estates pay most, if not
all, of their ordinary estate administration
expenses during the three-year period following the decedent’s date of death. This
three-year period takes into account a reasonable time for administering and closing the estate. The Treasury Department
Bulletin No. 2022–28
and the IRS note that a reasonably short
period of time between the decedent’s
death and the payment of a claim prevents the lack of a present-value discount
from significantly distorting the value of
the net (distributable) estate. Applying
present-value principles in computing the
deductible amount of those claims and
expenses paid more than three years after
the decedent’s death strikes an appropriate
balance between benefits and burdens.
Accordingly, the Treasury Department
and the IRS propose to amend the regulations under section 2053 to require the
discounting to present value of certain
amounts paid or to be paid in settlement or
satisfaction of certain claims and expenses
in determining the amount deductible
under section 2053. Specifically, the rule
in these proposed regulations requires calculating the present value of the amount
of a deductible claim or expense described
in section 2053(a) and §20.2053-1(a) that
is not paid or to be paid on or before the
third anniversary of the decedent’s date
of death, which three-year period the
proposed regulations define as the “grace
period.” The proposed regulations provide the general formula for calculating
the present value of such amounts and
state that the discount rate to be used in
the calculation is the applicable Federal
rate determined under section 1274(d) for
the month in which the decedent’s date of
death occurs, compounded annually. The
length of time from the decedent’s death
to the date of payment or expected date
of payment will determine whether the
Federal rate applicable to that amount is
the Federal mid-term rate or the Federal
long-term rate. The proposed regulations
provide that any reasonable assumptions
or methodology in regard to time period
measurements may be used in calculating
the present value. In addition, the proposed regulations require a supporting
statement to be filed with the Form 706
showing any calculations of present value.
The proposed regulations explain
how to calculate present value when the
amount of a claim or expense is deductible
in advance of the payment of such amount,
as under §§20.2053-1(d)(4) and 20.20534(b) and (c). The proposed regulations
provide that the expected date or dates
of payment will be used in computing
present value and that the expected date
73
or dates of payment will be determined
by making a fair and reasonable estimate
using all information reasonably available
to the taxpayer. For amounts deductible
under §20.2053-4(b) and (c), the proposed
regulations provide that the expected date
or dates of payment must be identified in
a written appraisal document. Consistent
with the rule in §20.2053-1(d)(2), which
takes into consideration events occurring
during the post-death period described in
that section, the proposed regulations also
provide that the computation of present
value is subject to adjustment if the actual
date of payment differs from the estimate
used.
III. Deductibility of Interest Expense as
Administration Expense
A. Issue Background
Section 2053(a)(2) allows an estate to
deduct from the value of the gross estate
the amount of administration expenses
that are allowable by the law of the jurisdiction in which the estate is being administered. In some cases, interest expense
incurred by an estate may be a deductible administration expense under section
2053(a)(2) if the facts support a finding
that the expense satisfies the requirements
of section 2053 and the regulations thereunder. Several statutory and regulatory
provisions are relevant to the deductibility
of interest as an administration expense
under section 2053(a)(2).
First, effective for decedents dying
after December 31, 1997, section 2053(c)
(1)(D) provides that, “no deduction shall
be allowed under [section 2053] for any
interest payable under section 6601 on
any unpaid portion of the [Federal estate
tax] for the period during which an extension of time for payment of such tax is in
effect under section 6166.”
Second, §20.2053-3(a) provides that
the amounts deductible from a decedent’s
gross estate as administration expenses
under section 2053(a)(2) are limited to
such expenses that actually and necessarily are incurred in the administration
of the decedent’s estate. The expenses
contemplated in the law are those that
are associated with the settlement of an
estate and the transfer of the property of
the estate to individual beneficiaries or
July 11, 2022
to a trustee. Expenditures not essential
to the proper settlement of the estate, but
incurred for the individual benefit of the
heirs, legatees, or devisees, may not be
taken as deductions.
Third, §20.2053-1(b)(2) provides
that only expenses that are bona fide in
nature are deductible under section 2053.
Section 20.2053-1(b)(2) applies to any
amounts deductible under section 2053(a)
and (b), including deductible administration expenses.
The issue of the extent to which and
the circumstances under which interest
expense satisfies the requirements for a
deductible administration expense under
section 2053(a)(2) and the regulations
thereunder is longstanding. Over the past
half century, a number of litigated cases
and sub-regulatory published guidance
items have provided some clarity on the
legal issues surrounding the ability to
deduct, as an administration expense
under section 2053(a)(2), interest accruing on deferred tax and penalties and on
loan obligations incurred by an estate. Litigation on this fact-driven issue continues
in regard to interest accruing on loan obligations incurred by an estate.
The Treasury Department and the IRS
consider it appropriate to amend the regulations under section 2053 to address specifically the issue of interest expense as a
deductible administration expense under
section 2053(a)(2). In particular, the Treasury Department and the IRS propose to
address interest expense accruing after the
death of the decedent on any unpaid portion of tax or penalties and on a loan obligation incurred by the estate to pay estate
taxes or other estate expenses.
B. Explanation of Provisions
1. Interest Accruing on Unpaid Tax and
Penalties
In general, interest is payable at the
underpayment rate in section 6621 on (i)
any amount of unpaid Federal tax, and
(ii) any unpaid additions to tax, additional
taxes, and penalties (such interest referred
to in this preamble as “section 6601 interest” and such additions to tax, additional
taxes, and penalties collectively referred
to in this preamble as “penalties”). See section 6601(a) and (e)(2). However, interest
July 11, 2022
payable under section 6601 on unpaid
estate tax deferred under section 6166
(which includes interest accruing on any
such deferred payment during any period
when an extension of time for payment is
in effect under section 6161(a)(2)(B) with
respect to that payment) (referred to in
this preamble as “section 6166 interest”)
is subject to a more favorable interest rate
under section 6601(j), and section 2053(c)
(1)(D) provides that such interest is not
deductible. The statutory prohibition of a
deduction for section 6166 interest does
not apply to “non-section 6166 interest,”
defined for purposes of this preamble as
any section 6601 interest other than section 6166 interest and interest payable on
any unpaid portion of state tax and penalties pursuant to state law. Thus, non-section 6166 interest that accrues on and after
the decedent’s date of death may qualify
as a deductible administration expense
under section 2053(a)(2).
To determine the deductibility of
non-section 6166 interest accruing on
and after the decedent’s date of death,
the existing regulatory requirements in
§§20.2053-1(b)(2) and 20.2053-3(a)
apply. Non-section 6166 interest satisfies
the “bona fide” requirement in §20.20531(b)(2) because such interest accrues
pursuant to either Federal or state law.
Non-section 6166 interest may satisfy
the “actually and necessarily incurred”
requirement in §20.2053-3(a), but such
determination depends on the facts and
circumstances.
Non-section 6166 interest may accrue
on and after the date of a decedent’s death
on unpaid estate tax in connection with
an extension granted under section 6161
(but not under section 6161(a)(2)(B)) or
a deferral elected under section 6163. A
section 6161 extension is granted upon a
showing of reasonable cause for extending the time for payment. A section 6163
deferral is appropriate when the value of a
reversionary or remainder interest is includible in the gross estate, but such value is
not immediately available for payment of
the estate tax. The nature of both section
6161 extensions and section 6163 deferrals indicates they are based on a demonstrable need to defer payment. Accordingly, the Treasury Department and the
IRS have determined that interest payable
under section 6601 on unpaid estate tax in
74
connection with an extension under section 6161 or a deferral under section 6163
is necessarily incurred in the administration of the estate.
Non-section 6166 interest may accrue
on and after the date of a decedent’s death
on unpaid tax and penalties in connection
with an underpayment of tax or a deficiency (as that term is defined in section
6211). In many cases, such interest and
the underlying underpayment of tax or
deficiency is attributable to the reasonable
exercise of an executor’s fiduciary duties
in administering the estate, as may occur
in cases involving legitimate disagreements with the IRS, inadvertent errors, or
reasonable reliance on a qualified professional. The Treasury Department and the
IRS have determined that, generally, such
interest is actually and necessarily incurred
in the administration of the estate. However, the Treasury Department and the IRS
are concerned that there are some circumstances in which such interest expense
would not satisfy the “actually and necessarily incurred” requirement in §20.20533(a). For instance, when non-section 6166
interest accrues on unpaid tax and penalties in connection with an underpayment
of tax or deficiency and the underlying
underpayment or deficiency is attributable
to an executor’s negligence, disregard of
the rules or regulations (including careless, reckless, or intentional disregard of
rules or regulations) as defined in §1.66623(b)(2), or fraud with intent to evade tax,
the interest expense is not an expense
actually and necessarily incurred in the
administration of the estate. Accordingly,
the Treasury Department and the IRS have
determined that, when interest accrues on
any unpaid tax or penalty and the interest
expense is attributable to an executor’s
negligence, disregard of the rules or regulations, or fraud with intent to evade tax,
the interest expense is neither actually and
necessarily incurred in the administration
of the estate nor essential to the proper settlement of the estate. Further, the Treasury
Department and the IRS have determined
that the rationale underlying this determination applies to all non-section 6166
interest, whether the interest accrues in
connection with a deferral, underpayment,
or deficiency.
The proposed regulations amend the
regulations under section 2053 to confirm
Bulletin No. 2022–28
that section 6166 interest on estate tax
deferred under section 6166, including interest accruing on an installment
under section 6166 during the period of
an extension of time for payment under
section 6161(a)(2)(B), is not a deductible administration expense under section
2053. The proposed regulations also provide that non-section 6166 interest that
accrues on or after the decedent’s date of
death on any unpaid tax or penalties may
be deductible to the extent permitted by
§§20.2053-1 and 20.2053-3(a). The proposed regulations further provide that
non-section 6166 interest on estate tax
deferred under section 6161 or section
6163 is actually and necessarily incurred
in the administration of the estate because
the grant of the extension was based on
a demonstrated need to defer payment.
Finally, the proposed regulations provide
that, in general, non-section 6166 interest
accruing post-death on any unpaid tax or
penalties in connection with an underpayment of tax or a deficiency is actually and
necessarily incurred in the administration
of the estate. However, the proposed regulations provide that, notwithstanding these
rules, non-section 6166 interest accruing
on unpaid tax and penalties on and after
the decedent’s date of death, whether in
connection with a deferral, underpayment, or deficiency, is not actually and
necessarily incurred in the administration
of the estate and is not deductible to the
extent the interest expense is attributable
to an executor’s negligence, disregard of
applicable rules or regulations (including
careless, reckless, or intentional disregard of rules or regulations) as defined in
§1.6662-3(b)(2), or fraud with intent to
evade tax. Interest expense is attributable
to an executor’s negligence, disregard of
applicable rules or regulations, or fraud
with intent to evade tax to the extent that
the underlying underpayment, deficiency,
or penalty is attributable to such conduct
by the executor. Similarly, even when the
underlying underpayment, deficiency, or
penalty is not attributable to such conduct by the executor, interest expense is
attributable to an executor’s negligence,
disregard of applicable rules or regulations, or fraud with intent to evade tax to
the extent the subsequent accrual of interest is attributable to such conduct by the
executor.
Bulletin No. 2022–28
The rules in the proposed regulations pertaining to whether non-section
6166 interest satisfies the requirement in
§20.2053-3(a) supplant the rule reflected
in Rev. Rul. 79-252, 1979-2 C.B. 333, and
in the second holding of Rev. Rul. 81-154,
1981-1 C.B. 470. (See §601.601(d)(2)(ii)
(b).) Together, these two holdings create an
implicit presumption that interest accruing
on any unpaid portion of tax or penalties
in all cases satisfies the requirements for a
deductible administration expense, which
is inconsistent with the requirement in
§20.2053-3(a) that the expense be actually
and necessarily incurred in the administration of the estate.
2. Interest Accruing on Certain Loan
Obligations Incurred by an Estate
The same requirements that apply for
deductible interest accruing on unpaid
tax and penalties also apply for deductible interest accruing on loan obligations
incurred by an estate. Interest accruing
on a loan obligation incurred by an estate
satisfies the “bona fide” requirement in
§20.2053-1(b)(2) when both the interest
expense and the loan underlying the interest expense are bona fide in nature and do
not constitute a transfer that is essentially
donative in character. Such interest satisfies the “actually and necessarily incurred”
requirement in §20.2053-3(a) when the
loan on which the interest expense accrues
and its terms are necessary to the administration of the decedent’s estate and are
essential to the proper settlement of the
decedent’s estate.
Among the reasons an estate might
enter into a loan arrangement is to facilitate the payment of the estate’s taxes
and other liabilities or the administration
of the estate. Some estates face genuine
liquidity issues that make it necessary to
find a means to satisfy their liabilities,
and incurring a loan obligation on which
interest accrues may be the only or best
way to obtain the necessary liquid funds.
However, if illiquidity has been created
intentionally (whether in the estate planning, or by the estate with knowledge or
reason to know of the estate tax liability)
prior to the creation of the loan obligation to pay estate expenses and liabilities,
the underlying loan may be bona fide in
nature but most likely will not be found to
75
be actually and necessarily incurred in the
administration of the estate.
The issue of the deductibility of interest expense accruing on a loan obligation
incurred by an estate has been litigated
often, with varying results. See, e.g.,
Estate of Black v. Commissioner, 133 T.C.
340 (2009); Estate of Graegin v. Commissioner, T.C. Memo. 1988-477. In order
to provide guidance on the deductibility
of interest accruing on a loan obligation
entered into by the decedent’s estate to
facilitate the payment of the estate’s taxes
and other liabilities or the administration
of the estate, the Treasury Department and
the IRS propose to amend the regulations
under section 2053. The proposed regulations provide that interest expense is
deductible only if: (i) the interest accrues
pursuant to an instrument or contractual
arrangement that constitutes indebtedness
under applicable income tax regulations
and general principles of Federal tax law;
(ii) both the interest expense and the loan
on which interest expense accrues satisfy
the requirement of §20.2053-1(b)(2) that
they are bona fide in nature; and (iii) the
loan on which interest accrues and the
loan’s terms are actually and necessarily
incurred in the administration of the decedent’s estate and are essential to the proper
settlement of the decedent’s estate (within
the meaning of §20.2053-3(a)).
Finally, the proposed regulations
include a nonexclusive list of factors to
consider in determining whether interest
expense payable pursuant to such a loan
obligation of an estate satisfies the requirements of §§20.2053-1(b)(2) and 20.20533(a). In general, the factors suggest that
interest accruing on a loan obligation may
satisfy these requirements when the loan
and its underlying terms are reasonable
and comparable to an arms-length loan
transaction and correspond to the estate’s
ability to satisfy the loan, and the loan
obligation is entered into by the executor with a lender who is not a substantial
beneficiary of the decedent’s estate (or an
entity controlled by such a beneficiary) at
a time when there is no viable alternative
to obtain the necessary liquid funds to satisfy estate liabilities. In addition to providing guidance on when interest accruing on
a loan obligation may satisfy the requirements of §§20.2053-1(b)(2) and 20.20533(a), the list of factors may suggest when
July 11, 2022
the opposite is true and interest accruing
on a loan obligation does not satisfy these
requirements. For instance, if, taken in
their entirety, the facts and circumstances
indicate that either the need for the loan or
any of the loan terms are contrived to generate, or increase the amount of, a deduction for the interest expense, the interest
is not deductible. Thus, if the lender is a
primary beneficiary of the estate (or an
entity controlled by such beneficiary)
who may have liability for payment of the
estate tax or whose share of the estate may
bear the burden of estate taxes and other
liabilities, the facts indicate the loan is not
necessarily incurred in the administration
of the estate and, therefore, indicate that
any interest accruing on the loan is not
necessarily incurred in the administration
of the estate. Further, if the loan obligation
carries an extended loan term with a single
balloon payment that does not correspond
with the estate’s ability to satisfy the loan,
the facts indicate that the interest accruing
on the loan is not necessarily incurred in
the administration of the estate.
section 170 were drafted in the context
of appraising an asset being donated, and
not a liability such as a claim against an
estate. Certain of the elements of a qualified appraisal, including references to the
“date of contribution,” and the requirements necessary to meet the definition
of a “qualified appraiser,” do not apply
in the context of valuing a claim against
an estate for purposes of determining the
value to be deducted from the gross estate
under section 2053.
The Treasury Department and the IRS
have determined that the rule in §20.20534(b) and (c) should be amended to remove
the requirement that the value be determined by a “qualified appraisal” performed by a “qualified appraiser” within
the meaning of section 170 and the regulations thereunder. Instead, the Treasury
Department and the IRS propose to amend
the regulations under section 2053 to provide revised rules for valuing claims for
purposes of §20.2053-4(b) and (c).
a person who is qualified to appraise the
claim being valued, but who is not (i) a
family member of the decedent, a related
entity as to the decedent, or a beneficiary
of the decedent’s estate or revocable trust
(as those terms are defined in §20.20531(b)(2)(iii)), (ii) a family member of a
beneficiary or a related entity as to a beneficiary (as those terms would be defined in
§20.2053-1(b)(2)(iii) if references therein
to the decedent were replaced with a reference to such beneficiary, and without the
limitations based on the decedent’s date of
death), or (iii) an employee or other owner
of any of them. The appraisal also must
include a statement describing the basis
for the person’s qualification to appraise
the claim being valued.
B. Explanation of Provision
IV. Substantiation Requirements for
Valuations Performed Pursuant to
§20.2053-4(b) and (c)
The Treasury Department and the IRS
propose to amend the regulations under
section 2053 to remove the requirement
in §20.2053-4(b)(1)(iv) and (c)(1)(iv) that
valuations of the claims deductible under
§20.2053-4(b) and (c) must be supported
by a “qualified appraisal” performed by
a “qualified appraiser.” For purposes
of determining the allowable deduction
under §20.2053-4(b) and (c), these proposed regulations instead provide new
requirements intended to facilitate the
appropriate valuation of these claims.
Specifically, to determine the current value of a claim deductible under
§20.2053-4(b) or (c), the proposed regulations require a written appraisal that
adequately reflects the current value of
the claim when the Form 706 is being
completed. The current value of the claim
should take into account post-death events
occurring prior to the time a deduction is
claimed as well as those events reasonably anticipated to occur. In addition, the
proposed regulations require the written
appraisal to consider all relevant facts and
elements of value that are known or that
can be reasonably anticipated at the time
of the appraisal. The written appraisal
must be prepared, signed, and dated by
A commenter responding to the 2007
Proposed Regulations suggested that the
final regulations confirm that payments
made pursuant to a decedent’s personal
guarantee existing at the decedent’s death
are deductible in the same manner as payments made in satisfaction of any other
deductible claim against a decedent’s
estate.
For payments made pursuant to a
decedent’s obligation as a guarantor of
indebtedness to be deductible, the claim
must represent a personal obligation of
the decedent existing at the time of the
decedent’s death, and the claim must be
enforceable against the decedent’s estate.
See §20.2053-4(a)(1). However, not all
enforceable debts are deductible under
section 2053. A claim founded upon a
decedent’s guarantee is considered a
claim founded upon a promise or agreement. Accordingly, the deduction for such
a claim is limited to the extent that the
guarantee was contracted bona fide and in
exchange “for an adequate and full consideration in money or money’s worth.”
See section 2053(c)(1)(A) and §20.20534(d)(5). For a claim founded upon a decedent’s guarantee to satisfy the “adequate
and full consideration in money or money’s worth” requirement and, therefore,
be deductible under section 2053, the
A. Issue Background
Section 20.2053-4(b) and (c) provides exceptions to the general rule in
§20.2053-4(a) that an estate may deduct
only amounts that actually are paid by the
estate in satisfaction of a claim. Section
20.2053-4(b) generally allows a deduction
for the value of claims and counterclaims
in a related matter, and §20.2053-4(c)
allows a deduction for the value of unpaid
claims totaling not more than $500,000.
In each case, certain requirements must be
satisfied to enable the estate to use these
exceptions.
One such requirement is that the value
of a claim against the estate that may be
deducted under either §20.2053-4(b) or
(c) must be determined from a “qualified appraisal” performed by a “qualified
appraiser” within the meaning of section
170 and the regulations thereunder. The
Treasury Department and the IRS have
reconsidered this requirement. The definition of “qualified appraiser” and “qualified appraisal” in the regulations under
July 11, 2022
76
V. Deductibility of Amounts Paid
Pursuant To Decedent’s Personal
Guarantee
A. Issue Background
Bulletin No. 2022–28
decedent must have received a benefit
reducible to money value in exchange
for the decedent’s guarantee. See United
States v. Stapf, 375 U.S. 118, 131 (1963)
(“Absent such an . . . augmentation of the
estate, a testator could disguise transfers
as payments in settlement of debts and
claims and thus obtain deductions for
transmitting gifts.”); Commissioner v.
Wemyss, 324 U.S. 303 (1945) (construing
the requirement of “adequate and full consideration in money or money’s worth”
in the gift tax context to require a benefit to the donor reducible to money value
“to relieve a transfer by him from being
a gift.”); Estate of Theis v. Commissioner,
81 T.C. 741, 745, 748 (1983) (noting the
amounts at issue must have been contracted bona fide and for full and adequate
consideration), aff’d 770 F.2d 981 (11th
Cir. 1985).
Guarantor agreements often are
required in the context of a loan to the
guarantor’s closely-held business. In these
cases, the guarantor may be motivated to
enter into the guarantee agreement to preserve the value of the guarantor’s interest
in the business. The Treasury Department and the IRS have determined that
it is appropriate to provide guidance on
whether, for purposes of section 2053, a
guarantor agreement is contracted for an
adequate and full consideration in money
or money’s worth in such a situation for
purposes of section 2053.
When payments pursuant to a decedent’s guarantee satisfy the requirements
for a deductible claim, the amount deductible is limited to the portion of the total
claim due from and actually paid by the
estate, but reduced by the amount recovered, or the amount that could have been
recovered, from another party, insurance,
or otherwise. See §§20.2053-1(d)(1) and
(3) and 20.2053-4(d)(3). Further, to avoid
the double-counting of a debt that occurs
when the debt both is taken into account in
computing the gross estate and is taken as
a section 2053 deduction, payments made
pursuant to the decedent’s guarantee are
deductible only to the extent that the debt
for which the guarantee is given has not
been taken into account in computing the
value of an asset includible in the decedent’s gross estate.
A regulatory provision specifically
addressing the deductibility of claims
Bulletin No. 2022–28
founded upon a decedent’s guarantee
will assist taxpayers in understanding and
meeting their tax responsibilities and will
result in consistent treatment for similarly
situated taxpayers.
B. Explanation of Provision
The proposed regulations provide that
a claim founded upon the decedent’s
agreement to personally guarantee a debt
of another is a claim founded on a promise
and, accordingly, must satisfy the applicable requirements in section 2053(c)(1)(A)
and §20.2053-4(d)(5). Specifically, the
guarantee must have been bona fide and
in exchange for adequate and full consideration in money or money’s worth. The
proposed regulations confirm that the bona
fide nature of a claim related to the guarantee of a debt of a family member, a related
entity, or a beneficiary will be determined
with reference to §20.2053-1(b)(2)(ii).
The proposed regulations provide a bright
line rule that a decedent’s agreement to
guarantee a bona fide debt of an entity in
which the decedent had control (within
the meaning of section 2701(b)(2)) at the
time of the guarantee satisfies the requirement that the agreement be in exchange
for adequate and full consideration in
money or money’s worth. Alternatively,
the proposed regulations provide that this
requirement also is satisfied if, at the time
the guarantee is given, the maximum liability of the decedent under the guarantee
did not exceed the fair market value of the
decedent’s interest in the entity. Finally,
the proposed regulations provide that the
estate’s right of contribution or reimbursement will reduce the amount deductible in
accordance with §20.2053-1(d)(3).
Proposed Applicability Date
The regulations are proposed to apply
to the estate of each decedent dying on or
after the date of publication in the Federal
Register of a Treasury decision adopting
these rules as final regulations.
Effect on Other Documents
Rev. Rul. 79-252 (1979-2 C.B. 333)
states that interest on a Federal estate tax
deficiency is a necessary administration
expense under section 2053(a)(2) and is
77
deductible to the extent allowable under
local law. Rev. Rul. 81-154 (1981-1 C.B.
470) states, in the second holding, that
interest incurred because of a late payment of tax is deductible under section
2053(a)(2) to the extent it is allowable
under local law. Rev. Rul. 79-252 will be
obsoleted and Rev. Rul. 81-154 will be
modified, effective as of the date that a
Treasury decision adopting these rules as
final regulations is published in the Federal Register.
Statement of Availability of IRS
Documents
IRS revenue procedures, revenue rulings, notices, and other guidance cited
in this document are published in the
Internal Revenue Bulletin (or Cumulative Bulletin) and are available from the
Superintendent of Documents, U.S. Government Publishing Office, Washington,
DC 20402, or by visiting the IRS website
at https://www.irs.gov.
Special Analyses
Regulatory Planning and Review
This regulation is not subject to review
under section 6(b) of Executive Order
12866 pursuant to the Memorandum of
Agreement (April 11, 2018) between the
Treasury Department and the Office of
Management and Budget regarding review
of tax regulations. Therefore, a regulatory
impact assessment is not required.
Regulatory Flexibility Act
Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it is hereby
certified that these regulations will not
have a significant economic impact on a
substantial number of small entities. This
certification is based on the fact that these
regulations primarily affect estates of a
decedent which generally are not small
entities under the Act. Accordingly, these
regulations are not expected to have a significant economic impact on a substantial
number of small entities, and a regulatory
flexibility analysis is not required.
Pursuant to section 7805(f) of the Code,
these proposed regulations will be submitted to the Chief Counsel for the Office of
July 11, 2022
Advocacy of the Small Business Administration for comment on their impact on
small businesses.
Paperwork Reduction Act
The collections of information contained in this notice of proposed rulemaking have 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)), under
Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return,
and assigned control number 1545-0015.
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, and to Clearance
Officer, SE:CAR:MP:T:T:SP, Washington, DC 20224. Comments on the collection of information should be received by
August 29, 2022. Comments are specifically requested concerning:
Whether the proposed collections of
information are necessary for the proper
performance of the functions of the IRS,
including whether the information will
have practical utility;
The accuracy of the estimated burden
associated with the proposed collection of
information;
How the quality, utility, and clarity of
the information to be collected may be
enhanced;
How the burden of complying with
the proposed collections of information
may be minimized, including through the
application of automated collection techniques or other forms of information technology; and
Estimates of capital or start-up costs of
operation, maintenance, and purchase of
services to provide information.
The collections of information in these
proposed regulations are in proposed
§§20.2053-1(d)(6)(iv) and 20.2053-4(b)
(1)(iv) and (c)(1)(iv). The information
requested in §20.2053-1(d)(6)(iv) is necessary in order to evaluate whether an
estate is entitled to a deduction in the
amount claimed on Form 706. The collection of information is mandatory to obtain
a benefit. The information requested in
§20.2053-4(b)(1)(iv) and (c)(1)(iv) is
July 11, 2022
necessary in order to evaluate whether an
estate is entitled to a deduction claimed
on Form 706 and, if so, the amount of
the deduction. The collection of information is mandatory to obtain a benefit. The
likely respondents are estates of decedents
seeking to deduct on Form 706 funeral
expenses, administration expenses, and/
or certain claims against the estate under
section 2053.
Estimated total annual reporting burden: 23,661 hours.
Estimated average annual burden per
respondent: 3 hours.
Estimated number of respondents:
7,887.
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.
Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates
Reform Act of 1995 (UMRA) requires
that agencies assess anticipated costs and
benefits and take certain other actions
before issuing a final rule that includes
any Federal mandate that may result in
expenditures in any one year by a state,
local, or tribal government, in the aggregate, or by the private sector, of $100 million (updated annually for inflation). This
proposed rule does not include any Federal mandate that may result in expenditures by state, local, or tribal governments,
or by the private sector in excess of that
threshold.
Executive Order 13132: Federalism
E.O. 13132, titled “Federalism,” prohibits an agency from publishing any rule
that has federalism implications if the rule
either imposes substantial, direct compliance costs on state and local governments,
and is not required by statute, or preempts
state law, unless the agency meets the
78
consultation and funding requirements of
section 6 of the E.O. This proposed rule
does not have federalism implications and
does not impose substantial direct compliance costs on state and local governments
or preempt state law within the meaning
of the E.O.
Drafting Information
The principal authors of these regulations are Karlene Lesho and Melissa
Liquerman, Office of the Associate Chief
Counsel (Passthroughs and Special Industries). However, other personnel from the
Treasury Department and the IRS participated in their development.
Comments and Public Hearing
Before these proposed regulations are
adopted as final regulations, consideration
will be given to any comments that are
submitted timely to the IRS as prescribed
in this preamble under the ADDRESSES
section. The Treasury Department and the
IRS request comments on all aspects of
the proposed regulations.
Any electronic comments submitted,
and to the extent practicable, any paper
comments submitted, will be made available at www.regulations.gov or upon
request.
A public hearing is being held by teleconference on October 12, 2022, at 10:00
a.m. EST unless no outlines are received
by September 26, 2022.
The rules of 26 CFR 601.601(a)(3)
apply to the hearing. Persons who wish
to comment by telephone at the hearing
must submit electronic or written comments and an outline of the topics to be
discussed and the time to be devoted to
each topic by September 26, 2022 as
prescribed in the preamble under the
ADDRESSES section. A period of ten
minutes will be allotted to each person for
making comments (although this rule may
be waived in unusual circumstances or for
good cause shown). After the deadline for
receiving outlines has passed, the IRS will
prepare an agenda containing the schedule
of speakers. Copies of the agenda will be
made available at www.regulations.gov,
search IRS and REG-130975-08. Copies
of the agenda will also be available by
emailing a request to publichearings@irs.
Bulletin No. 2022–28
gov. Please put “REG-130975-08 Agenda
Request” in the subject line of the email.
Announcement 2020-4, 2020-17 IRB
667 (April 20, 2020), provides that until
further notice, public hearings conducted
by the IRS will be held telephonically.
Any telephonic hearing will be made
accessible to people with disabilities.
List of Subjects in 26 CFR Part 20
Estate taxes, Reporting and recordkeeping requirements.
Proposed Amendments to the
Regulations
Accordingly, the IRS proposes to
amend 26 CFR part 20 as follows:
PART 20—ESTATE TAX; ESTATES
OF DECEDENTS DYING AFTER
AUGUST 16, 1954
Paragraph 1. The authority citation for
part 20 continues to read in part as follows:
Authority: 26 U.S.C. 7805.
*****
Par. 2. Section 20.2053-1 is amended
by:
1. Adding paragraph (d)(6).
2. Revising the introductory text of
paragraph (d)(7).
3. In paragraph (d)(7), Examples 1
through 3 are designated as paragraphs (d)
(7)(i) through (iii), respectively.
4. In newly designated paragraphs (d)
(7)(i) and (ii):
i. Removing “ascertainable,” and adding “ascertainable.” in its place.
ii. Adding a sentence to the end of the
paragraphs.
5. In newly designated paragraph (d)
(7)(iii):
i. Removing “deduction,” and “Example 2” and adding “deduction.” and “paragraph (d)(7)(ii) of this section (Example
2)” in their places, respectively.
ii. Revising the last sentence of the
paragraph.
6. Adding paragraphs (d)(7)(iv)
through (vi).
7. Revising paragraph (f).
The additions and revisions read as
follows:
§20.2053-1 Deductions for expenses,
indebtedness, and taxes; in general.
Bulletin No. 2022–28
*****
(d) * * *
(6) Limitation on amount deductible--(i) Claims and expenses paid after
the grace period--(A) Definitions. The
following definitions apply for purposes
of this paragraph (d):
(1) Grace period. The grace period is
the period beginning on the date of the
decedent’s death and extending through
the third anniversary of that date.
(2) Post-grace-period payment. A postgrace-period payment is the amount of a
claim or expense described in paragraph
(a) of this section not paid or to be paid
before the end of the grace period.
(B) General rule. To the extent that
a post-grace-period payment otherwise
meets the requirements for deductibility
of a claim or expense under section 2053
and the regulations in this part thereunder, the amount deductible under section
2053 is limited to the present value, as
of the decedent’s date of death, of that
amount. The present value of each postgrace-period payment is calculated by
discounting it from the payment date or
expected date of payment to the decedent’s date of death. The applicable discount rate is the applicable Federal rate
determined under section 1274(d) for
the month in which the decedent’s death
occurs, compounded annually. The length
of time from the decedent’s date of death
to the date of payment or expected date
of payment will determine whether the
Federal rate applicable to that payment
is the Federal mid-term rate or the Federal long-term rate. The Internal Revenue
Service publishes the applicable Federal
rates for each month in the Internal Revenue Bulletin (see §601.601(d)(2)(ii) of
this chapter). Any reasonable assumptions
and methodology in regard to time period
measurements may be used to calculate,
in accordance with paragraph (d)(6)(ii) of
this section, the present value of the postgrace-period payment(s).
(ii) Calculating present value of
amounts paid or payable--(A) Single
post-grace-period payment. The amount
deductible under section 2053 for a single
post-grace-period payment is computed
by calculating the present value of such
payment as follows:
Amount of future payment x [1 ÷ (1 + i )]t
79
Where:
t is the amount of time (expressed in years
and fractions of years) from the day after
the decedent’s date of death to the payment date or expected date of payment;
and
i is the applicable discount rate.
(B) Multiple post-grace-period payments. The amount deductible under section 2053 for multiple post-grace-period
payments is computed by calculating the
present value of each such payment using
the formula in paragraph (d)(6)(ii)(A) of
this section; the sum of the discounted
amounts of the post-grace-period payments is the amount that is deductible for
such payments.
(C) Multiple payment dates occurring
during and after the grace period. A claim
or expense described in paragraph (a) of
this section may have at least one payment
date or expected date of payment during
the grace period and at least one payment
date or expected date of payment after the
grace period. For such a claim or expense,
the amount deductible under section 2053
is computed by calculating the present
value of each separate post-grace-period
payment using the formula in paragraph
(d)(6)(ii)(A) of this section, and adding
the total of these discounted amounts to
any amount of the claim or expense having a payment date or expected date of
payment during the grace period. Any
amount having a payment date or expected
date of payment during the grace period is
not discounted in arriving at the amount
deductible.
(iii) Discounting when actual date
of payment is unknown. With regard to
a post-grace-period payment that may
be deducted in advance of payment
under paragraph (d)(4) of this section or
§20.2053-4(b) or (c), the amount deductible must be determined by computing the
present value of the amount of that postgrace-period payment as if that amount
will be paid on the expected date of payment. The expected date of payment in
settlement or satisfaction of a claim or
expense must be determined using all
information reasonably available to the
taxpayer to make a fair and reasonable
estimate of the expected date or dates of
payment. For amounts deductible under
§20.2053-4(b) or (c), the expected date
or dates of payment must be identified in
July 11, 2022
a written appraisal document of a person
that is qualified by knowledge and experience to appraise the claim being valued. See §20.2053-4(b)(1)(iv) and (c)(1)
(iv). However, the computation of present
value is subject to adjustment if, within
the period described in paragraph (d)(2)
of this section, the actual date or dates of
payment become known and differ from
the estimated date or dates of payment.
See paragraph (d)(6)(vi) of this section.
(iv) Statement supporting present value
computation required. A deduction under
section 2053 for a claim or expense that is
required to be discounted to present value
under paragraph (d)(6)(i) of this section
must be supported by a statement to be
filed with the Form 706 showing the computation of the present value of that item,
including, if applicable, the basis for the
determination of the expected date(s) of
payment.
(v) Ordering rule. In computing the
amount deductible for a claim or expense
under paragraph (d) of this section, the
amount deductible for a claim or expense
(otherwise determined under paragraphs
(d)(1) through (4) of this section) is discounted to present value under paragraph
(d)(6) of this section before applying the
limits in §20.2053-4(b)(2) and (c).
(vi) Effect of post-death events. If
a deduction is claimed for the present
value of a post-grace-period payment, the
claimed deduction is subject to adjustment
to reflect any post-death events affecting
the amount of such post-grace-period payment and any change in the expected or
actual date of payment. See paragraph (d)
(2) of this section for the period during
which post-death events are taken into
account.
(vii) Exceptions. The rule in paragraph (d)(6)(i) of this section does not
apply to unpaid principal of mortgages
and other indebtedness deductible under
§20.2053-7.
(7) Examples. Assume that the amounts
described in section 2053(a) are payable
out of property subject to claims and
are allowable by the law of the jurisdiction governing the administration of the
estate, whether the applicable jurisdiction is within or outside of the United
States. Assume that, unless otherwise
provided, the claims against the estate are
not deductible under §20.2053-4(b) or (c)
and all amounts are paid during the grace
period. The following examples illustrate
the application of this paragraph (d):
(i) * * * However, any amounts that
will not be paid on or before the third
anniversary of the date of D’s death (that
is, are not paid during the grace period)
are subject to the present value limitation
in paragraph (d)(6) of this section.
(ii) * * * If the amount of the claim will
not be paid on or before the third anniversary of the date of D’s death (that is,
the amount is not paid during the grace
period), the amount deductible is subject
to the present value limitation in paragraph (d)(6) of this section.
(iii) * * * At that time, a deduction will
be allowed for the amount that is either
paid or meets the requirements of paragraph (d)(4) of this section for deducting
certain ascertainable amounts, subject to
the present value limitation in paragraph
(d)(6) of this section, if applicable.
(iv) Example 4: Discounting amount paid more
than three years after decedent’s date of death. The
facts are the same as in paragraph (d)(7)(ii) of this
section (Example 2) except that E files a timely protective claim for refund in accordance with paragraph (d)(5) of this section to preserve the estate’s
right to claim a refund, a final judgment in the
amount of $100x is entered against and paid by the
estate precisely five years after D’s date of death,
and the applicable Federal (mid-term) rate determined under section 1274(d) for the month in which
D’s date of death occurs, compounded annually, is
2.00%. Within a reasonable period of time after the
final judgment is entered, E notifies the Commissioner that the contingency has been resolved. E
may claim a deduction for the present value of the
amount paid in satisfaction of the claim as of D’s
date of death. Under the facts in this paragraph (d)
(7)(iv), the present value of the amount paid in five
years equals $100x / (1 + .0200)5 or $100x/1.104081
or $90.57x.
(v) Example 5: Discounting amount to be paid
when actual date of payment not known. The facts
are the same as in paragraph (d)(7)(ii) of this section (Example 2) except that the claim is deductible
under §20.2053-4(c) because all amounts deducted
by the estate under that paragraph do not exceed
$500,000. E obtains a written appraisal document
meeting the requirements of §20.2053-4(c)(iv) and
reasonably determines that the future value of the
claim is $300,000 (that is, before discounting the
claim to its present value). E determines, after considering all available information and making reasonable assumptions, that the expected date of payment of the claim is Date X, which is reflected in the
appraisal. Date X is a date after the third anniversary
of D’s date of death. E may claim a deduction for the
present value of the claim as of D’s date of death,
determined by discounting $300,000 for the period
from the date of death to Date X, using the applicable
Federal rate determined under section 1274(d) for
the month in which D’s death occurs, compounded
annually.
(vi) Example 6: Discounting amount to be paid
for series of payments payable over a period that
does not end on or before the third anniversary
of the decedent’s death. Pursuant to the terms of a
divorce and separation agreement entered on June 1
of Year 1, Decedent (D) is obligated to make annual
payments of $100x to Claimant (C) on September 1
of year 1 and each September 1st thereafter until D
has made a total of 10 such payments. D dies on
December 1 of Year 5 after having made the first
five annual payments required under the agreement.
The applicable Federal (mid-term) rate determined
under section 1274(d) for the month in which D’s
death occurs, compounded annually, is 2.00%. The
executor of D’s estate (E) may claim a deduction
with respect to C’s claim on D’s Form 706 under
the special rule contained in paragraph (d)(4) of
this section because the deductible amount can be
ascertained with reasonable certainty. E computes
the discounted deductible amount of the claim by
adding the undiscounted amount of the three payments that will be made before the third anniversary
of D’s death ($300x) to the discounted amounts of
the two payments that will be made after the third
anniversary of D’s death. Accordingly, the amount
deductible for the claim equals $483.866x ($300x +
$92.843x + $91.023x). The individual calculations
for the present values of the payments in the last two
years of the payment obligation are shown in table 1
to this paragraph (d)(7)(vi).
Table 1 to paragraph (d)(7)(vi)
(1)
(2)
(3)
(4)
(5)
t
1+i
1/(1+i)
[1/(1+i)]t
[1/(1+i)]t×100x
Year 9
3.75
1.0200
0.980392
0.928430
92.843x
Year 10
4.75
1.0200
0.980392
0.910226
91.023x
*****
July 11, 2022
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Bulletin No. 2022–28
(f) Applicability date. The rules of this
section apply to the estates of decedents
dying on or after [date of publication of
the final in the Federal Register].
Par. 3. Section 20.2053-3 is amended
by:
1. Redesignating paragraphs (d) and (e)
as paragraphs (e) and (f), respectively.
2. Adding a new paragraph (d).
3. Revising newly redesignated paragraph (f).
The addition and revision read as
follows:
§20.2053-3 Deduction for expenses of
administering estate.
*****
(d) Interest expense incurred in administering the estate--(1) Interest payable
under section 6601 on unpaid tax--(i) Section 6166 interest. As used in paragraph
(d)(1) of this section, the phrase “section
6166 interest” means interest payable
under section 6601 on unpaid estate tax
deferred under section 6166. This includes
interest accruing on an installment or other
payment under section 6166 during the
period of an extension of time for making
that payment under section 6161(a)(2)(B).
Section 6166 interest is not deductible
pursuant to section 2053(c)(1)(D).
(ii) Non-section 6166 interest. As used
in paragraph (d)(1) of this section, the
phrase “non-section 6166 interest” means
interest payable under section 6601 or
under state or local law other than section
6166 interest. Non-section 6166 interest
that accrues on or after the decedent’s date
of death on any unpaid tax or penalties
may be deductible to the extent permitted
by §20.2053-1 and this section. For purposes of paragraph (d)(1) of this section,
penalties include any unpaid additions to
tax, additional taxes, and penalties. When
non-section 6166 interest accrues on
unpaid estate tax deferred under section
6161 or section 6163, the interest expense
is actually and necessarily incurred in the
administration of the estate for purposes
of paragraph (a) of this section because the
extension was based on a demonstrated
need to defer payment. When non-section
6166 interest accrues on and after the date
of a decedent’s death on any unpaid tax
or penalties in connection with an underpayment of tax or a deficiency, the interest
expense generally is actually and necessarily incurred in the administration of the
Bulletin No. 2022–28
estate for purposes of paragraph (a) of this
section.
(iii) Exception. Notwithstanding paragraph (d)(1)(ii) of this section, non-section 6166 interest accruing on unpaid tax
and penalties on and after the decedent’s
date of death, whether in connection with
a deferral, underpayment, or deficiency,
is not actually and necessarily incurred in
the administration of the estate for purposes of paragraph (a) of this section and
is not deductible to the extent the interest
expense is attributable to an executor’s
negligence, disregard of applicable rules
or regulations (including careless, reckless, or intentional disregard of rules or
regulations) as defined in §1.6662-3(b)
(2) of this chapter, or fraud with intent to
evade tax. Interest expense is attributable
to an executor’s negligence, disregard of
applicable rules or regulations, or fraud
with intent to evade tax to the extent that
the underlying deferral, underpayment,
or deficiency, is attributable to such conduct by the executor. Similarly, even
when the underlying deferral, underpayment, or deficiency is not attributable to
such conduct by the executor, the interest
expense is attributable to an executor’s
negligence, disregard of the rules or regulations, or fraud with intent to evade tax
to the extent the subsequent accrual of
interest is attributable to such conduct by
the executor.
(iv) Examples. The following examples
illustrate the application of this paragraph
(d)(1). In each example, the decedent (D)
dies on October 1, Year 1, and the estate
tax return is due July 1 of the following
calendar year, Year 2. In each example,
except as expressly stated, there is no
negligence, disregard of applicable rules
or regulations, or fraud on the part of the
executor.
(A) Example 1. On July 1, Year 2, the executor
of D’s estate (E) timely files the estate tax return
based on values determined in good faith and pays
$500,000, which is the estate tax shown on the return.
Upon examination, the Internal Revenue Service
(IRS) makes an adjustment to the value of an asset
includible in the gross estate, resulting in a $25,000
increase in estate tax due. E initially contests the
adjustment, but eventually agrees to the assessment
of the deficiency in the amount of $25,000. Interest on the deficiency is payable under section 6601
in the amount of $X. E makes a payment in satisfaction of the assessed deficiency and interest. For
purposes of paragraph (a) of this section, the interest
expense in the amount of $X is considered actually
and necessarily incurred in the administration of D’s
81
estate, and its deduction reduces the amount of the
deficiency.
(B) Example 2. The executor of D’s estate (E)
files the estate tax return and pays the estate tax
shown on the return ($500,000) on July 1 of Year 3,
one year after the due date. On August 1, Year 3, the
IRS assesses interest on the unpaid tax under section
6601 in the amount of $X, assesses late filing and
late payment penalties in accordance with section
6651 in the amount of $Y, and issues a notice and
demand for payment of $X and $Y. On August 1,
Year 4, E makes payment to the IRS of $Z, which
is the total amount due for $X and $Y, as well as
interest that accrued on these amounts from August
1, Year 3, to August 1, Year 4, payable under section
6601. The facts establish that E’s failure to timely file
the return and timely pay the tax and failure to pay
the assessed interest and penalties within the period
provided in the notice and demand is a result of E’s
disregard of the rules for filing the return and paying
the tax and any assessed penalties. Under the facts in
this paragraph (d)(1)(iv)(B), neither the interest payable under section 6601 that accrued on the unpaid
tax before notice and demand nor the interest that
accrued on the unpaid tax and penalties after notice
and demand is an expense that is actually and necessarily incurred in the administration of D’s estate for
purposes of paragraph (a) of this section.
(C) Example 3. Prior to D’s death, the IRS had
assessed an income tax deficiency against D for the
2009 tax period in the amount of $75,000, and penalties in the amount of $X. The assessed tax and penalties remained unpaid on D’s date of death. On July 1,
Year 2, the executor of D’s estate (E) timely files the
estate tax return and timely pays the estate tax shown
on the return to be due. On the same date, E also pays
all claims against and liabilities of the estate, except
for the assessed income tax deficiency and penalties
for the 2009 tax period. Despite E’s awareness that
the estate had sufficient liquidity and funds to satisfy
all estate liabilities, including the 2009 income tax
deficiency and penalties, E does not pay the assessed
income tax deficiency, penalties, and accrued interest
until July 1, Year 4. E’s failure to pay the assessed
income tax deficiency and penalties for the 2009 tax
period is a result of E’s disregard of applicable rules
or regulations. Even though the underlying income
tax deficiency is not attributable to E’s negligence,
disregard of applicable rules, or fraud with intent to
evade tax, the interest that accrued after July 1, Year
2, on the assessed deficiency and penalties is attributable to E’s disregard of applicable rules or regulations. Accordingly, the post-July 1, Year 2, interest
is not an expense that is actually and necessarily
incurred in the administration of D’s estate.
(2) Interest expense on certain loan
obligations of the estate. Interest on a loan
entered into by the estate to facilitate the
payment of the estate’s tax and other liabilities or the administration of the estate
may be deductible depending on all the
facts and circumstances. To be a deductible administration expense, interest
expense must arise from an instrument or
contractual arrangement that constitutes
indebtedness under applicable income
July 11, 2022
tax regulations and general principles of
Federal tax law. In addition, the interest
expense and the loan to which interest
expense relates must satisfy the requirement of §20.2053-1(b)(2) that they are
bona fide in nature based on all the facts
and circumstances. Further, both the loan
to which the interest expense relates and
the loan terms must be actually and necessarily incurred in the administration of
the decedent’s estate and must be essential
to the proper settlement of the decedent’s
estate. See paragraph (a) of this section.
If the facts and circumstances establish
that the interest expense arises from an
instrument or contractual arrangement
that constitutes indebtedness under general principles of Federal tax law, factors
that collectively may support a finding
that the interest expense also satisfies the
additional requirements under §20.20531(b)(2) and paragraph (a) of this section include, but are not limited to, the
following:
(i) The interest rate on and the terms
of the underlying loan (whether between
related or unrelated parties), including any
prepayment penalty, are reasonable given
all the facts and circumstances and comparable to an arms-length loan transaction;
(ii) The underlying loan is entered into
by an executor of the decedent’s estate
acting in the capacity of executor or, if no
executor is appointed and acting, the person accountable for satisfying the liabilities of the estate;
(iii) The lender properly includes
amounts of paid and/or accrued interest (including original issue discount as
determined under sections 1271 through
1275 and the regulations in this part under
those sections, such as original issue discount attributable to stated interest that is
treated as part of the stated redemption
price at maturity because it is not payable
at least annually) in gross income for Federal income tax purposes, particularly if
the lender is a family member of the decedent, a related entity, or a beneficiary of
the decedent’s estate or trust (as defined in
§20.2053-1(b)(2)(iii));
(iv) The loan proceeds are used to satisfy estate liabilities that are essential to
the proper settlement of the estate, including, but not limited to, the Federal estate
tax liability;
July 11, 2022
(v) The loan term and payment schedule correspond to the estate’s anticipated
ability to make the payments under, and
to satisfy, the loan, and the loan term does
not extend beyond what is reasonably
necessary;
(vi) The only practical alternatives to
the loan are the sale of estate assets at
prices that are significantly below-market, the forced liquidation of an entity
that conducts an active trade or business,
or some similar financially undesirable
course of action;
(vii) The underlying loan is entered into
when the estate’s liquid assets are insufficient to satisfy estate liabilities, the estate
does not have control (within the meaning
of section 2701(b)(2)) of an entity that has
liquid assets sufficient to satisfy estate liabilities, the estate has no power to direct or
compel an entity in which it has an interest
to sell liquid assets to enable the estate to
satisfy its liabilities, and the estate’s assets
are expected to generate sufficient cash
flow or liquidity to make the payments
required under the loan;
(viii) The estate’s illiquidity does not
occur after the decedent’s death as a result
of the decedent’s testamentary estate plan
to create illiquidity; similarly, the illiquidity does not occur post-death as a deliberate result of the action or inaction of the
executor who then had both knowledge or
reason to know of the estate tax liability
and a reasonable alternative to that action
or inaction that could have avoided or mitigated the illiquidity;
(ix) The lender is not a beneficiary of
a substantial portion of the value of the
estate, and is not an entity over which
such a beneficiary has control (within
the meaning of section 2701(b)(2)) or the
right to compel or direct the making of the
loan;
(x) The lender or lenders are not beneficiaries of the estate whose individual
share of liability under the loan is substantially similar to his or her share of the
estate; and
(xi) The decedent’s estate has no right
of recovery of estate tax against, or of
contribution from, the person loaning the
funds.
*****
(f) Applicability date. The rules of this
section apply to the estates of decedents
82
dying on or after [date of publication of
the final rule in the Federal Register].
Par. 4. Section 20.2053-4 is amended
by:
1. Revising paragraphs (b)(1)(iv), (b)
(2), and (c)(1)(iv) and (v), the second sentence of paragraph (c)(3), paragraph (d)
(5), and paragraph (d)(7)(iii) introductory
text.
2. In paragraph (d)(7)(iii), Examples 1
through 9 are designated as paragraphs (d)
(7)(iii)(A) through (I), respectively.
3. In newly designated paragraph (d)
(7)(iii)(A), removing “decision,” and
“§20.2053-3(c) or §20.2053-3(d)(3)” adding “decision.” and “§20.2053-3(c) or (d)
(3)” in their places, respectively.
4. In newly designated paragraphs
(d)(7)(iii)(B) and (C), removing “payment,”, “Example 1”, and “§20.2053-3(c)
or §20.2053-3(d)(3)” and adding “payment.”, “paragraph (d)(7)(iii)(A) of this
section (Example 1)”, and “§20.2053-3(c)
or (d)(3)” in their places, respectively.
5. In newly designated paragraph (d)
(7)(iii)(D), removing “defendants,”,
“Example 1”, and “§20.2053-3(c) or
§20.2053-3(d)(3)” and adding “defendants.”, “paragraph (d)(7)(iii)(A) of this
section (Example 1)”, and “§20.2053-3(c)
or (d)(3)” in their places, respectively.
6. In newly designated paragraph (d)(7)
(iii)(E), removing “payment,”, “Example
1”, and “§20.2053-3(c) or §20.2053-3(d)
(3)” and adding “payment.”, “paragraph
(d)(7)(iii)(A) of this section (Example
1)”, and “§20.2053-3(c) or (d)(3)” in their
places, respectively.
7. In newly designated paragraph
(d)(7)(iii)(F), removing “claims,” and
“§20.2053-3(c) or §20.2053-3(d)(3)” and
adding “claims.” and “§20.2053-3(c) or
(d)(3)” in their places, respectively.
8. In newly designated paragraph (d)
(7)(iii)(G), removing “enforceability,” and
adding “enforceability.” in its place.
9. In newly designated paragraph (d)
(7)(iii)(H), removing “estate,” and adding
“estate.” in its place.
10. In newly designated paragraph (d)
(7)(iii)(I), removing “satisfaction,” and
adding “satisfaction.” in its place.
11. Adding paragraph (d)(7)(iii)(J).
12. Revising paragraph (f).
The revisions and addition read as
follows:
Bulletin No. 2022–28
§20.2053-4 Deduction for claims against
the estate.
*****
(b) * * *
(1) * * *
(iv) The value of each such claim
against the estate is supported by a written appraisal document to be filed with the
Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, or
successor form, and the written appraisal
document-(A) Adequately reflects post-death
events that have occurred prior to the date
on which a deduction is claimed on an
estate’s Form 706;
(B) Reports, considers, and appropriately weighs all relevant facts and elements of value as are known or are reasonably determinable at the time of the
appraisal, including the underlying facts
of the claim against the estate, potential
litigating risks, and the current status of
the claim and procedural history;
(C) Takes into account post-death
events reasonably anticipated to occur;
(D) Identifies an expected date or dates
of payment (for purposes of determining
the applicability of the present value limitation in §20.2053-1(d)(6));
(E) Explains in detail the methods
and analysis that support the appraisal’s
conclusions;
(F) Is prepared, signed under penalties
of perjury, and dated by a person who is
qualified by knowledge and experience to
appraise the claim being valued and is not
a family member of the decedent, a related
entity, or a beneficiary of the decedent’s
estate or revocable trust (as those terms are
defined in §20.2053-1(b)(2)(iii)), a family member of a beneficiary or a related
entity as to a beneficiary (as those terms
would be defined in §20.2053-1(b)(2)(iii)
if references therein to the decedent were
replaced with a reference to such beneficiary, and without regard to the limitations in §20.2053-1(b)(2)(iii) based on the
decedent’s date of death), or an employee
or other owner of any of them; and
(G) Includes a statement providing
the basis for the person’s qualifications to
appraise the claim being valued;
*****
(2) Limitation on deduction. The
deduction under this paragraph (b) is
Bulletin No. 2022–28
limited to the value of the related claims
or particular assets included in decedent’s
gross estate. See §20.2053-1(d)(6)(v) for
the impact of the present value limitation.
*****
(c) * * *
(1) * * *
(iv) The value of each such claim
against the estate is supported by a written appraisal document to be filed with the
Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, or
successor form, and the written appraisal
document-(A) Adequately reflects post-death
events that have occurred prior to the date
on which a deduction is claimed on an
estate’s Form 706;
(B) Reports, considers and appropriately weighs all relevant facts and elements of value as are known or reasonably
determinable at the time of the appraisal,
including the underlying facts of the claim
against the estate, potential litigating
risks, and the current status of the claim
and procedural history;
(C) Takes into account post-death
events reasonably anticipated to occur;
(D) Identifies an expected date or dates
of payment (for purposes of determining
the applicability of the present value limitation in §20.2053-1(d)(6));
(E) Explains in detail the methods
and analysis that support the appraisal’s
conclusions;
(F) Is prepared, signed under penalties
of perjury, and dated by a person who is
qualified by knowledge and experience to
appraise the claim being valued, and is not
a family member of the decedent, a related
entity, or a beneficiary of the decedent’s
estate or revocable trust (as those terms are
defined in §20.2053-1(b)(2)(iii)), a family member of a beneficiary or a related
entity as to a beneficiary (as those terms
would be defined in §20.2053-1(b)(2)(iii)
if references therein to the decedent were
replaced with a reference to such beneficiary, and without regard to the limitations in §20.2053-1(b)(2)(iii) based on the
decedent’s date of death), or an employee
or other owner of any of them; and
(G) Includes a statement providing
the basis for the person’s qualifications to
appraise the claim being valued;
(v) The total amount deducted by the
estate under paragraph (c) of this section
83
does not exceed $500,000 (see §20.20531(d)(6)(v) for the impact of the present
value limitation);
*****
(3) * * * Assume that each claim is paid
within three years after the decedent’s
death, and that the value of each claim is
determined from a written appraisal document that meets the requirements of paragraph (c)(1)(iv) of this section. * * *
(d) * * *
(5) Claims founded upon a promise--(i) In general. To be deductible, a
claim founded on a promise must represent a personal obligation of the decedent existing at the time of the decedent’s
death, and the claim must be enforceable
against the decedent’s estate. In addition,
except with regard to pledges or subscriptions (see §20.2053-5), the deduction
for a claim founded upon a promise or
agreement is limited to the extent that the
promise or agreement was bona fide and
in exchange for adequate and full consideration in money or money’s worth; that
is, the promise or agreement must have
been bargained for at arm’s length and the
price must have been an adequate and full
equivalent reducible to money value.
(ii) Decedent’s promise to guarantee
a debt. A deduction for a claim founded
upon a decedent’s agreement to guarantee
a debt of another is a claim founded on
a promise and is subject to the limitation
in paragraph (d)(5)(i) of this section. For
purposes of section 2053, a decedent’s
agreement to guarantee a debt of an entity
in which the decedent had an interest at
the time the guarantee was given satisfies
the requirement that the agreement be in
exchange for adequate and full consideration in money or money’s worth if, at the
time the guarantee was given, the decedent had control (within the meaning of
section 2701(b)(2)) of the entity. Alternatively, this requirement is satisfied to the
extent the maximum liability of the decedent under the guarantee did not exceed,
at the time the guarantee was given, the
fair market value of the decedent’s interest
in the entity. The bona fide nature of the
decedent’s agreement to guarantee a debt
of a family member, a related entity, or a
beneficiary (as defined in §20.2053-1(b)
(2)(iii)) is determined in accordance with
§20.2053-1(b)(2)(ii). For a claim otherwise deductible under this paragraph (d)
July 11, 2022
(5)(ii), the estate’s right of contribution
or reimbursement will reduce the amount
deductible in accordance with §20.20531(d)(3). Payments made pursuant to the
decedent’s guarantee of a debt are deductible only to the extent that the debt for
which the guarantee is given has not been
taken into account in computing the value
of the gross estate under §20.2053-7 or
otherwise.
*****
(7) * * *
(iii) The claimant (C) is not a family
member, related entity, or beneficiary of
the estate of decedent (D), unless otherwise provided, and is not the executor (E).
July 11, 2022
*****
(J) Example 10: Guarantee. On Date 1, D
entered into a guarantee agreement with Bank (C) to
secure financing for a closely-held business (LLC) in
which D had a controlling interest. LLC was solvent
at the time LLC executed a promissory note in the
amount of $100x in favor of C. Prior to D’s death,
LLC became insolvent and stopped making payments on the note. After D’s death, C filed a claim
against D’s estate for payment of the remaining balance due under the note and E paid the full amount
due. Although E had a right of contribution against
LLC for primary payment of the indebtedness, LLC
was insolvent and no part of the debt was collectible
at the time E deducted the payment. D’s estate may
deduct the amount paid to C in satisfaction of D’s
liability under the guarantee agreement. The guarantee agreement is considered to have been contracted
for an adequate and full consideration in money or
84
money’s worth. The result would be the same if D
did not have control of LLC as long as the fair market value of D’s interest in the LLC on Date 1 was
at least $100x.
*****
(f) Applicability date. The rules of this
section apply to the estates of decedents
dying on or after [date of publication of
the final rule in the Federal Register].
Paul J. Mamo,
Acting Deputy Commissioner for
Services and Enforcement.
(Filed by the Office of the Federal Register on June
24, 2022, 4:15 p.m., and published in the issue of the
Federal Register for June 28, 2022, 87 F.R. 38331)
Bulletin No. 2022–28
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 applies 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 laws 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 a 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
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.
E.O.—Executive Order.
ER—Employer.
Bulletin No. 2022–28
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduciary.
FC—Foreign Country.
FICA—Federal Insurance Contributions 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.
i
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.—Statement of Procedural 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.
July 11, 2022
Numerical Finding List1
Bulletin 2022–28
Notices:
2022-29, 2022-28 I.R.B. 66
2022-30, 2022-28 I.R.B. 70
Proposed Regulations:
REG-130975-08, 2022-28 I.R.B. 71
Revenue Procedures:
2022-25, 2022-27 I.R.B. 3
2022-28, 2022-27 I.R.B. 65
Revenue Rulings:
2022-12, 2022-27 I.R.B. 1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2021–27 through 2021–52 is in Internal Revenue Bulletin
2021–52, dated December 27, 2021.
1
July 11, 2022
ii
Bulletin No. 2022–28
Finding List of Current Actions on
Previously Published Items1
Bulletin 2022–28
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2021–27 through 2021–52 is in Internal Revenue Bulletin
2021–52, dated December 27, 2021.
1
Bulletin No. 2022–28
iii
July 11, 2022
Internal Revenue Service
Washington, DC 20224
Official Business
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