Bulletin No. 2021–36

HIGHLIGHTS

OF THIS ISSUE





Bulletin No. 2021–36

September 7, 2021

These synopses are intended only as aids to the reader in

identifying the subject matter covered. They may not be

relied upon as authoritative interpretations.

INCOME TAX

Notice 2021-51, page 361.

The notice announces that the Treasury Department and

the IRS intend to amend certain regulations under sections

1446(a) and 1446(f) to defer the applicability date to January

1, 2023.

Finding Lists begin on page ii.

Rev. Rul. 2021-16, page 359.

Federal rates; adjusted federal rates; adjusted federal

long-term rate, and the long-term tax exempt rate. For

purposes of sections 382, 1274, 1288, 7872 and other

sections of the Code, tables set forth the rates for September 2021.

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 Unpublished rulings will not be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.

September 7, 2021 

Bulletin No. 2021–36

Part I

Section 1274.—

Determination of Issue

Price in the Case of Certain

Debt Instruments Issued for

Property

(Also Sections 42, 280G, 382, 467, 468, 482, 483,

1288, 7520, 7872.)

Rev. Rul. 2021-16

This revenue ruling provides various

prescribed rates for federal income tax

AFR

110% AFR

120% AFR

130% AFR

AFR

110% AFR

120% AFR

130% AFR

150% AFR

175% AFR

AFR

110% AFR

120% AFR

130% AFR

Short-term adjusted AFR

Mid-term adjusted AFR

Long-term adjusted AFR

Bulletin No. 2021–36

purposes for September 2021 (the current month). Table 1 contains the shortterm, mid-term, and long-term applicable federal rates (AFR) for the current

month for purposes of section 1274(d)

of the Internal Revenue Code. Table 2

contains the short-term, mid-term, and

long-term adjusted applicable federal

rates (adjusted AFR) for the current

month for purposes of section 1288(b).

Table 3 sets forth the adjusted federal long-term rate and the long-term

tax-exempt rate described in section

382(f). Table 4 contains the appropri-

ate percentages for determining the

low-income housing credit described in

section 42(b)(1) for buildings placed in

service during the current month. However, under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service

after July 30, 2008, shall not be less

than 9%. Finally, Table 5 contains the

federal rate for determining the present

value of an annuity, an interest for life

or for a term of years, or a remainder or

a reversionary interest for purposes of

section 7520.

REV. RUL. 2021-16 TABLE 1

Applicable Federal Rates (AFR) for September 2021

Period for Compounding

Annual

Semiannual

Quarterly

Short-term

0.17%

0.17%

0.17%

0.19%

0.19%

0.19%

0.20%

0.20%

0.20%

0.22%

0.22%

0.22%

Mid-term

0.86%

0.86%

0.86%

0.95%

0.95%

0.95%

1.03%

1.03%

1.03%

1.12%

1.12%

1.12%

1.29%

1.29%

1.29%

1.52%

1.51%

1.51%

Long-term

1.73%

1.72%

1.72%

1.90%

1.89%

1.89%

2.07%

2.06%

2.05%

2.25%

2.24%

2.23%

REV. RUL. 2021-16 TABLE 2

Adjusted AFR for September 2021

Period for Compounding

Annual

Semiannual

0.13%

0.13%

0.65%

0.65%

1.31%

1.31%

359

Quarterly

0.13%

0.65%

1.31%

Monthly

0.17%

0.19%

0.20%

0.22%

0.86%

0.95%

1.03%

1.12%

1.29%

1.51%

1.71%

1.88%

2.05%

2.23%

Monthly

0.13%

0.65%

1.31%

September 7, 2021

REV. RUL. 2021-16 TABLE 3

Rates Under Section 382 for September 2021

Adjusted federal long-term rate for the current month

Long-term tax-exempt rate for ownership changes during the current month (the highest of the adjusted federal

long-term rates for the current month and the prior two months.)

1.31%

1.57%

REV. RUL. 2021-16 TABLE 4

Appropriate Percentages Under Section 42(b)(1) for September 2021

Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after

July 30, 2008, shall not be less than 9%.

Appropriate percentage for the 70% present value low-income housing credit

7.30%

Appropriate percentage for the 30% present value low-income housing credit

3.13%

REV. RUL. 2021-16 TABLE 5

Rate Under Section 7520 for September 2021

Applicable federal rate for determining the present value of an annuity, an interest for life or a

term of years, or a remainder or reversionary interest

Section 42.—Low-Income

Housing Credit

The applicable federal short-term, mid-term,

and long-term rates are set forth for the month of

September 2021. See Rev. Rul. 2021-16, page 359.

Section 280G.—Golden

Parachute Payments

The applicable federal short-term, mid-term,

and long-term rates are set forth for the month of

September 2021. See Rev. Rul. 2021-16, page 359.

Section 382.—Limitation

on Net Operating Loss

Carryforwards and

Certain Built-In Losses

Following Ownership

Change

The adjusted applicable federal long-term rate

is set forth for the month of September 2021. See

Rev. Rul. 2021-16, page 359.

Section 467.—Certain

Payments for the Use of

Property or Services

The applicable federal short-term, mid-term,

and long-term rates are set forth for the month of

September 2021. See Rev. Rul. 2021-16, page 359.

Section 468.—Special

Rules for Mining and Solid

Waste Reclamation and

Closing Costs

The applicable federal short-term rates are set

forth for the month of September 2021. See Rev.

Rul. 2021-16, page 359.

Section 482.—Allocation

of Income and Deductions

Among Taxpayers

The applicable federal short-term, mid-term,

and long-term rates are set forth for the month of

September 2021. See Rev. Rul. 2021-16, page 359.

1.0%

Section 483.—Interest on

Certain Deferred Payments

The applicable federal short-term, mid-term,

and long-term rates are set forth for the month of

September 2021. See Rev. Rul. 2021-16, page 359.

Section 1288.—Treatment

of Original Issue Discount

on Tax-Exempt Obligations

The adjusted applicable federal short-term, midterm, and long-term rates are set forth for the month

of September 2021. See Rev. Rul. 2021-16, page 359.

Section 7520.—Valuation

Tables

The applicable federal mid-term rates are set

forth for the month of September 2021. See Rev.

Rul. 2021-16, page 359.

Section 7872.—Treatment

of Loans With BelowMarket Interest Rates

The applicable federal short-term, mid-term,

and long-term rates are set forth for the month of

September 2021. See Rev. Rul. 2021-16, page 359.

September 7, 2021

360

Bulletin No. 2021–36

Part III

Applicability Date of

Certain Regulations Under

Sections 1446(a) and (f)

Notice 2021-51

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 1446(a) and 1446(f) to

defer the applicability date to January 1,

2023 for certain provisions relating to the

following: (i) withholding under section

1446(f) on transfers of interests in publicly traded partnerships (“PTP interests”);

(ii) withholding under section 1446(a) on

distributions made with respect to PTP interests; and (iii) withholding under section

1446(f)(4) by partnerships on distributions to transferees. Before the issuance of

these amendments, taxpayers may rely on

the provisions of this notice regarding the

modified applicability dates.

II. BACKGROUND

Sections 864(c)(8) and 1446(f) were

added to the Code by the Tax Cuts and

Jobs Act, Pub. L. 115-97 on December

22, 2017. Section 864(c)(8) generally

provides that gain or loss derived by a

foreign person on the sale or exchange

of an interest in a partnership engaged

in a U.S. trade or business is treated as

effectively connected gain or loss and,

therefore, is subject to U.S. tax. Section

1446(f)(1) requires a transferee of an

interest in a partnership to withhold 10

percent of the amount realized if any portion of the gain on the disposition would

be treated under section 864(c)(8) as effectively connected with the conduct of a

trade or business within the United States

(unless an exception applies). Section

1446(f)(4) provides that if a transferee

fails to withhold on the disposition as required under section 1446(f)(1), the partnership must withhold on distributions to

the transferee.

Bulletin No. 2021–36

On November 30, 2020, the Treasury

Department and the IRS published final

regulations (TD 9926) in the Federal Register (85 FR 76910, as corrected at 86 FR

13191) primarily relating to withholding

and information reporting under section

1446(f). The final regulations include

withholding and reporting requirements

under section 1446(f)(1) applicable to

brokers effecting transfers of PTP interests on behalf of foreign persons. The final

regulations also require a broker that pays

an amount realized to a foreign broker to

withhold on the amount realized, unless

the foreign broker is a qualified intermediary (QI) (or a U.S. branch treated as a U.S.

person) that assumes primary withholding

responsibility under section 1446(f)(1).

The final regulations modify certain rules

in §1.1446-4, which previously permitted

only a publicly traded partnership or a

U.S. person to be the withholding agent,

to allow a QI (or a U.S. branch treated as

a U.S. person) to assume withholding on

distributions with respect to PTP interests

under section 1446(a), in part to coordinate with withholding requirements under

section 1446(f)(1). Under the final regulations, a QI that assumes withholding on

a distribution under section 1446(a) must

also assume withholding on the distribution under section 1446(f). The final regulations also provide rules under section

1446(f)(4) for withholding and reporting

by partnerships (other than publicly traded partnerships) making distributions to

transferees of partnership interests who

failed to withhold as required under section 1446(f)(1). The provisions of the final regulations described in this paragraph

apply to transfers and distributions that

occur on or after January 1, 2022.

III. AMENDED APPLICABILITY

DATES

Following the publication of the final

regulations, the Treasury Department and

the IRS received comments noting that

taxpayers will face significant challenges complying with certain provisions of

the final regulations by January 1, 2022,

and requesting a deferred applicability

date. These challenges include the follow-

361

ing: designing, building, and testing new

withholding and reporting infrastructure;

analyzing new forms and withholding

statements; and implementing systems

to capture required data. Brokers that are

qualified intermediaries (and U.S. branches treated as U.S. persons) have the additional challenge of implementing systems

and processes to withhold and report

under section 1446(a) as well as section

1446(f).

In consideration of the concerns raised

by taxpayers, and to allow for an orderly implementation of the requirements of

section 1446(f) with respect to PTP interests, the Treasury Department and the

IRS intend to amend certain applicability

dates of the final regulations (primarily

the applicability date in §1.1446(f)-4(f))

to provide that the provisions relating to

withholding and reporting on transfers

of PTP interests under section 1446(f)

(1) will apply to transfers that occur on

or after January 1, 2023. The Treasury

Department and the IRS also intend to

amend the applicability date of the modifications to §1.1446-4 listed in §1.1446-7

to apply to distributions with respect to

PTP interests made on or after January 1,

2023. The modified applicability date for

these provisions will then align with the

modified applicability date for withholding and reporting under section 1446(f)

(1) with respect to PTP interests. In addition, in order to allow for an orderly

implementation of the withholding and

reporting requirements for partnerships

under section 1446(f)(4), the Treasury

Department and the IRS intend to amend

the applicability date in §1.1446(f)-3(f)

so that the provisions of the final regulations requiring partnerships to withhold

under section 1446(f)(4) will apply to

transfers that occur on or after January 1,

2023.

IV. DRAFTING INFORMATION

The principal author of this notice is

Charles Rioux of the Office of Associate

Chief Counsel (International). For further

information regarding this notice, contact

Mr. Rioux at (202) 317-4992 (not a tollfree number).

September 7, 2021

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. 2021–36

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.

September 7, 2021

Numerical Finding List1

Bulletin 2021–36

Announcements:

2021-12, 2021-31 I.R.B. 267

2021-13, 2021-33 I.R.B. 314

2021-14, 2021-33 I.R.B. 315

Notices:

2021-39, 2021-27 I.R.B. 3

2021-40, 2021-28 I.R.B. 15

2021-41, 2021-29 I.R.B. 17

2021-42, 2021-29 I.R.B. 19

2021-38, 2021-30 I.R.B. 155

2021-44, 2021-31 I.R.B. 166

2021-45, 2021-31 I.R.B. 170

2021-47, 2021-32 I.R.B. 269

2021-46, 2021-33 I.R.B. 303

2021-48, 2021-33 I.R.B. 305

2021-49, 2021-34 I.R.B. 316

2021-43, 2021-35 I.R.B. 332

2021-50, 2021-35 I.R.B. 333

2021-51, 2021-36 I.R.B. 361

Proposed Regulations:

REG-107705-21, 2021-30 I.R.B. 162

REG-102951-16, 2021-32 I.R.B. 272

Revenue Procedures:

2021-28, 2021-27 I.R.B. 5

2021-29, 2021-27 I.R.B. 12

2021-24, 2021-29 I.R.B. 19

2021-14, 2021-30 I.R.B. 158

2021-30, 2021-31 I.R.B. 172

2021-31, 2021-33 I.R.B. 324

2021-33, 2021-34 I.R.B. 327

2021-34, 2021-35 I.R.B. 337

2021-35, 2021-35 I.R.B. 355

2021-36, 2021-35 I.R.B. 357

Revenue Rulings:

2021-12, 2021-27 I.R.B. 1

2021-13, 2021-30 I.R.B. 152

2021-14, 2021-31 I.R.B. 164

2021-15, 2021-35 I.R.B. 331

2021-16, 2021-36 I.R.B. 359

Treasury Decisions:

9951, 2021-30 I.R.B. 25

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

September 7, 2021

ii

Bulletin No. 2021–36

Finding List of Current Actions on

Previously Published Items1

Bulletin 2021–36

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. 2021–36

iii

September 7, 2021

Internal Revenue Service

Washington, DC 20224

Official Business

Penalty for Private Use, $300

INTERNAL REVENUE BULLETIN

The Introduction at the beginning of this issue describes the purpose and content of this publication. The weekly Internal Revenue

Bulletins are available at www.irs.gov/irb/.

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