Section 411(d)(6) Protected Benefits (Taxpayer Relief Act of 1997); Qualified Retirement Plan Benefits

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[REG-101363-98]

RIN 1545-AV94

Section 411(d)(6) Protected Benefits (Taxpayer Relief Act of

1997); Qualified Retirement Plan Benefits

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking by cross-reference to temporary

regulations.

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SUMMARY: In the Rules and Regulations section of this issue of the

Federal Register, the IRS is issuing temporary regulations providing

for changes to the rules regarding qualified retirement plan benefits

that are protected from reduction by plan amendment, that have been

made necessary by the Taxpayer Relief Act of 1997. The text of those

temporary regulations also serves as the text of these proposed

regulations.

DATES: Written comments and requests for a public hearing must be

received by December 3, 1998.

ADDRESSES: Send submissions to: CC:DOM:CORP:R (REG-101363-98), room

5228, Internal Revenue Service, POB 7604, Ben Franklin Station,

Washington, DC 20044. Submissions may be hand delivered between the

hours of 8 a.m. and 5 p.m. to: CC:DOM:CORP:R (REG-101363-98),

[[Page 47215]]

Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue NW.,

Washington, DC. Alternatively, taxpayers may submit comments

electronically via the internet by selecting the ``Tax Regs'' option on

the IRS Home Page, or by submitting comments directly to the IRS

internet site at http://www.irs/ustreas.gov/prod/tax__regs/

comments.html.

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, Linda S.

F. Marshall, (202) 622-6030 (not a toll-free call); concerning

submissions, Michael Slaughter, (202) 622-7190 (not a toll-free call).

SUPPLEMENTARY INFORMATION:

Background

Temporary regulations in the Rules and Regulations section of this

issue of the Federal Register amend the Income Tax Regulations (26 CFR

part 1) relating to section 411(d)(6), to provide for changes that have

been made necessary by the Taxpayer Relief Act of 1997 (TRA '97),

Public Law 105-34, 111 Stat. 788 (1997). The temporary regulations

change the existing regulations to conform with the TRA '97 rules

regarding in-kind distribution requirements for certain employee stock

ownership plans, and specify the time period during which certain plan

amendments for which relief has been granted by TRA '97 may be made

without violating the prohibition against plan amendments that reduce

accrued benefits.

The text of those temporary regulations also serves as the text of

these proposed regulations. The preamble to the temporary regulations

explains the temporary regulations.

Special Analyses

It has been determined that this notice of proposed rulemaking is

not a significant regulatory action as defined in EO 12866. Therefore,

a regulatory assessment is not required. It also has been determined

that section 553(b) of the Administrative Procedure Act (5 U.S.C.

chapter 5) does not apply to these regulations, and because the

regulation does not impose a collection of information on small

entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not

apply. Pursuant to section 7805(f) of the Internal Revenue Code, this

notice of proposed rulemaking will be submitted to the Chief Counsel

for Advocacy of the Small Business Administration for comment on its

impact on small business.

Comments and Requests for a Public Hearing

Before these proposed regulations are adopted as final regulations,

consideration will be given to any written comments (a signed original

and eight (8) copies) that are submitted timely to the IRS. All

comments will be available for public inspection and copying. A public

hearing may be scheduled if requested in writing by any person that

timely submits written comments. If a public hearing is scheduled,

notice of the date, time, and place for the hearing will be published

in the Federal Register.

Drafting Information: The principal author of these regulations is

Linda S. F. Marshall, Office of the Associate Chief Counsel, Employee

Benefits and Exempt Organizations. However, other personnel from the

IRS and Treasury Department participated in their development.

List of Subjects in 26 CFR Part 1

Income taxes, Reporting and recordkeeping requirements.

Proposed Amendments to the Regulations

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

PART 1--INCOME TAXES

Paragraph 1. The authority citation for part 1 continues to read in

part as follows:

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

Par. 2. Section 1.411(d)-4 is amended by:

1. Revising paragraph (d)(1)(ii) of Q&A-2.

2. Adding Q&A-11.

The addition and revisions read as follows:

Sec. 1.411(d)-4 Section 411(d)(6) protected benefits.

* * * * *

Q-2 * * *

(d)(1)(ii) [The text of proposed paragraph (d)(1)(ii) of Q&A-2 is

the same as the text of Sec. 1.411(d)-4T Q&A-2(d)(1)(ii) published

elsewhere in this issue of the Federal Register.]

* * * * *

Q&A-11 [The text of proposed Q&A-11 is the same as the text of

Sec. 1.411(d)-4T Q&A-11 published elsewhere in this issue of the

Federal Register.]

Michael P. Dolan,

Deputy Commissioner of Internal Revenue.

[FR Doc. 98-23570 Filed 9-3-98; 8:45 am]

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