EMPLOYEE PLANSNotice 99–21, page 19.Weighted average interest rate update. The weightedaverage interest rate for April 1999 and the resulting per-missible range of interest rates used to calculate current lia-bility for purposes of the full funding limitation of section412(c)(7) of the Code are set forth.

EXEMPT ORGANIZATIONST.D. 8818, page 3.Public disclosure of material relating to tax-exemptorganizations. Final regulations under section 6104(d) ofthe Code relate to public disclosure requirements applicableto tax-exempt organizations.

Announcement 99–48, page 20.A list is given of organizations now classified as private foun-dations.

ADMINISTRATIVE

T.D. 8818, page 3.Public disclosure of material relating to tax-exemptorganizations. Final regulations under section 6104(d) of

the Code relate to public disclosure requirements applicableto tax-exempt organizations.

Rev. Proc. 99–21, page 18.Refunds and credits; period of limitations; financialdisability. Taxpayers are informed about the informationthat is required under section 6511(h)(2)(A) of the Code inorder to request suspension of the period of limitationsunder section 6511 for claiming a credit or refund of tax dueto an individual taxpayer’s financial disability.

Notice 99–20, page 16.Electronic funds transfer; failure to deposit penalty.Taxpayers are informed that beginning July 1, 1999, certaintaxpayers that deposited more than $200,000 in aggregatefederal depository taxes during calendar year 1998 will besubject to the 10-percent failure to deposit penalty undersection 6656 of the Code if those taxpayers fail to make de-posits by electronic funds transfer. The Service will not, how-ever, impose the section 6656 penalty on taxpayers that didnot deposit more than $200,000 in aggregate federal de-pository taxes during calendar year 1998 solely for the fail-ure to deposit by electronic funds transfer.

Internal Revenue

bbuulllleettiinnBulletin No. 1999–17

April 26, 1999

HIGHLIGHTSOF THIS ISSUEThese synopses are intended only as aids to the reader inidentifying the subject matter covered. They may not berelied upon as authoritative interpretations.

Department of the TreasuryInternal Revenue Service

Finding Lists begin on page 24.

IRB 1999-17 4/21/99 11:47 AM Page 1

The Internal Revenue Bulletin is the authoritative instrumentof the Commissioner of Internal Revenue for announcing offi-cial rulings and procedures of the Internal Revenue Serviceand for publishing Treasury Decisions, Executive Orders, TaxConventions, legislation, court decisions, and other items ofgeneral interest. It is published weekly and may be obtainedfrom the Superintendent of Documents on a subscriptionbasis. Bulletin contents are consolidated semiannually intoCumulative Bulletins, which are sold on a single-copy basis.

It is the policy of the Service to publish in the Bulletin all sub-stantive rulings necessary to promote a uniform applicationof the tax laws, including all rulings that supersede, revoke,modify, or amend any of those previously published in theBulletin. All published rulings apply retroactively unless other-wise indicated. Procedures relating solely to matters of in-ternal management are not published; however, statementsof internal practices and procedures that affect the rightsand duties of taxpayers are published.

Revenue rulings represent the conclusions of the Service onthe application of the law to the pivotal facts stated in therevenue ruling. In those based on positions taken in rulingsto taxpayers or technical advice to Service field offices,identifying details and information of a confidential natureare deleted to prevent unwarranted invasions of privacy andto comply with statutory requirements.

Rulings and procedures reported in the Bulletin do not havethe force and effect of Treasury Department Regulations,but they may be used as precedents. Unpublished rulingswill not be relied on, used, or cited as precedents by Servicepersonnel in the disposition of other cases. In applying pub-lished rulings and procedures, the effect of subsequent leg-islation, regulations, court decisions, rulings, and proce-

dures must be considered, and Service personnel and oth-ers concerned are cautioned against reaching the same con-clusions in other cases unless the facts and circumstancesare substantially the same.

The Bulletin is divided into four parts as follows:

Part I.—1986 Code.This part includes rulings and decisions based on provisionsof 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 Subpart B, Legislation and RelatedCommittee Reports.

Part III.—Administrative, Procedural, and Miscellaneous.To the extent practicable, pertinent cross references tothese subjects are contained in the other Parts and Sub-parts. Also included in this part are Bank Secrecy Act Admin-istrative Rulings. Bank Secrecy Act Administrative Rulingsare issued by the Department of the Treasury’s Office of theAssistant Secretary (Enforcement).

Part IV.—Items of General Interest.This part includes notices of proposed rulemakings, disbar-ment and suspension lists, and announcements.

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

Mission of the Service

Provide America’s taxpayers top quality service by help-ing them understand and meet their tax responsibilities

and by applying the tax law with integrity and fairness toall.

2

Introduction

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

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

IRB 1999-17 4/21/99 11:47 AM Page 2

Section 6104.—Publicity ofInformation Required FromCertain Exempt Organizationsand Certain Trusts

26 CFR 301.6104(d)–3: Public inspection anddistribution of applications for tax exemption andannual information returns of tax-exemptorganizations (other than private foundations).

T.D. 8818

DEPARTMENT OF THE TREASURYInternal Revenue Service26 CFR Part 301 and 602

Public Disclosure of MaterialRelating to Tax-ExemptOrganizations

AGENCY: Internal Revenue Service(IRS), Treasury.

ACTION: Final regulations.

SUMMARY: This document containsfinal regulations relating to the public dis-closure requirements of section 6104(d) ofthe Internal Revenue Code (Code), asamended by the Tax and Trade Relief Ex-tension Act of 1998. These final regula-tions apply only to tax-exempt organiza-tions (organizations described in sections501(c) or (d) and exempt under section501(a)) other than private foundations.These final regulations provide guidancefor tax-exempt organizations (other thanprivate foundations) required to make theirapplications for tax exemption and annualinformation returns available for public in-spection. In particular, these regulationsprovide guidance for tax-exempt organiza-tions required to comply with requestsmade in person or in writing from individ-uals who seek a copy of those documents.These regulations describe how a tax-ex-empt organization can make those docu-ments widely available and, therefore, notbe required to provide copies in responseto individual requests. These regulationsalso address the standards that apply in de-termining whether a tax-exempt organiza-tion is the subject of a harassment cam-paign and provide guidance on theapplicable procedures for obtaining relieffrom the requirement that copies of docu-ments be provided in response to requests.

DATES: These regulations are effectiveJune 8, 1999.

FOR FURTHER INFORMATION CON-TACT: Michael B. Blumenfeld, (202)622-6070 (not toll-free number).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

The collections of information con-tained in these final regulations have beenreviewed and approved by the Office ofManagement and Budget in accordancewith the Paperwork Reduction Act (44U.S.C. 3507) under control number 1545-1560. Responses to these collections ofinformation are mandatory.

An agency may not conduct or sponsor,and a person is not required to respond to,a collection of information unless the col-lection of information displays a validcontrol number.

The estimated annual burden per re-spondent/recordkeeper varies from 0hours to 55 hours, depending on individ-ual circumstances with an estimated aver-age of 30 minutes.

Comments on the accuracy of this bur-den estimate and suggestions for reducingthe burden should be sent to the InternalRevenue Service,Attn: IRS ReportsClearance Officer, OP:FS:FP, Washing-ton, DC 20224, and to the Office of Man-agement and Budget,Attn: Desk Officerfor the Department of the Treasury, Officeof Information and Regulatory Affairs,Washington, DC 20503.

Books or records relating to this collec-tion of information must be retained aslong as their contents may become mater-ial in the administration of any internalrevenue law. Generally, tax returns andtax return information are confidential, asrequired by 26 U.S.C. 6103.

Background

This document contains amendments tothe Procedure and Administration Regula-tions (26 CFR part 301) relating to thesection 6104(d) public disclosure require-ments applicable to tax-exempt organiza-tions (organizations described in sections501(c) or (d) and exempt from taxationunder section 501(a)). Section 6104(d),

as amended by section 14(b) of the Taxand Trade Relief Extension Act of 1998(Division J of H.R. 4328, the OmnibusConsolidated and Emergency Supplemen-tal Appropriations Act, 1999) (Public Law105–277, 112 Stat. 2681) (Tax and TradeRelief Extension Act of 1998), will applyto requests made to all tax-exempt organi-zations (other than private foundations)after June 8, 1999. Until such date, alltax-exempt organizations continue to besubject to the requirements of section6104(e) as currently in effect, without re-gard to the Tax and Trade Relief Exten-sion Act of 1998.

Although the Tax and Trade Relief Ex-tension Act of 1998 extended fully to pri-vate foundations the public disclosure re-quirements that apply to other tax-exemptorganizations, those requirements do notgo into effect with respect to private foun-dations until the 60th day after the Secre-tary of the Treasury issues final regula-tions under section 6104(d) that apply toprivate foundations. In the meantime, pri-vate foundations continue to be subject tothe public disclosure requirements undersections 6104(d) and (e) of the InternalRevenue Code, as in effect prior to theTax and Trade Relief Extension Act of1998.

Description of Current Law Section 6104(e)

Section 10702 of the Omnibus BudgetReconciliation Act of 1987 (OBRA ’87)added subsection (e) to section 6104.Section 6104(e) requires each tax-exemptorganization, including one that is a pri-vate foundation, to allow public inspec-tion of the organization’s application forrecognition of tax exemption. Section6104(e) also requires each tax-exempt or-ganization, other than one that is a privatefoundation, to allow public inspection atthe organization’s principal office (andcertain regional or district offices) of itsthree most recent annual information re-turns. (Section 6104(e) does not apply toprivate foundation annual information re-turns, which are subject to public disclo-sure under section 6104(d), as in effectprior to the Tax and Trade Relief Exten-sion Act of 1998.) Under section 6104(e),each annual information return must be

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

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made available for a 3-year period begin-ning on the date the return is required tobe filed or is actually filed, whichever islater. In Notice 88–120 (1988–2 C.B.454), the IRS provided tax-exempt orga-nizations with guidance for complyingwith the public inspection requirements.

The Taxpayer Bill of Rights 2(TBOR2), enacted on July 30, 1996,amended section 6104(e) by adding addi-tional public disclosure requirements. Asamended, section 6104(e) requires eachtax-exempt organization, including onethat is a private foundation, to complywith requests, made either in person or inwriting, for copies of the organization’sapplication for recognition of tax exemp-tion. Section 6104(e) also requires eachtax-exempt organization, other than onethat is a private foundation, to complywith requests, made either in person or inwriting, for copies of the organization’sthree most recent annual information re-turns. The organization must fulfill theserequests without charge, other than a rea-sonable fee for reproduction and postage.If the request for copies is made in per-son, the organization generally must pro-vide the requested copies immediately. Ifthe request for copies is made in writing,the organization must provide the copieswithin 30 days. Section 6104(e) also pro-vides that an organization is relieved of itsobligation to provide copies upon requestif, in accordance with regulations promul-gated by the Secretary of the Treasury, (1)the organization has made the requesteddocuments widely available, or (2) theSecretary of the Treasury determines,upon application by the organization, thatthe organization is subject to a harassmentcampaign such that a waiver of the oblig-ation to provide copies would be in thepublic interest.

Issuance of Proposed Regulations underSection 6104(e)

In Notice 96–48 (1996–2 C.B. 214),the IRS invited comments on the changesmade by TBOR2. Twenty-two commentswere received and considered in the draft-ing of a notice of proposed rulemaking(REG–246250–96, 1997–2 C.B. 627),published in the Federal Register(62F.R. 50533) on September 26, 1997. TheIRS received twenty written comments onthe proposed regulations and held a publichearing on February 4, 1998. After con-

sideration of all the written comments re-garding the proposed regulations, and theamendments made by the Tax and TradeRelief Extension Act of 1998, describedbelow, those regulations are adopted asrevised by this Treasury decision.

Amendments Made by the Tax and TradeRelief Extension Act of 1998

The Tax and Trade Relief ExtensionAct of 1998, which was enacted on Octo-ber 21, 1998, amended section 6104(e) ofthe Internal Revenue Code to subject pri-vate foundations to the same rules regard-ing public disclosure of annual informa-tion returns that apply to other tax-exemptorganizations. In addition, the Tax andTrade Relief Extension Act of 1998 re-pealed existing section 6104(d), and re-designated section 6104(e), as amended,as new section 6104(d). (Unless other-wise noted, all references in these finalregulations to section 6104(d) are to sec-tion 6104(d) as amended by the Tax andTrade Relief Extension Act of 1998.)

The Tax and Trade Relief ExtensionAct of 1998 amendments apply to re-quests made after the later of December31, 1998, or the 60th day after the Secre-tary of the Treasury issues regulations re-ferred to in section 6104(d)(4) (relating towhen documents are made widely avail-able and when a particular request is con-sidered part of a harassment campaign).This Treasury decision adopts final regu-lations under section 6104(d)(4) that areapplicable to tax-exempt organizationsother than private foundations. Accord-ingly, amendments to section 6104(d) willbecome applicable with respect to re-quests made to tax-exempt organizationsother than private foundations after June8, 1999.

Future Regulations Will Apply to Private Foundations

The IRS and the Treasury Departmentintend to issue shortly a notice of pro-posed rulemaking relating to the publicdisclosure requirements of section6104(d) as those requirements apply toprivate foundations. Until 60 days afterfinal regulations are issued, private foun-dations continue to be subject to sections6104(d) and (e), as in effect prior to the Tax and Trade Relief Extension Act of 1998. For that reason, existing

§301.6104(d)–1, relating to public inspec-tion of private foundation annual returns,is not affected by this Treasury decision.

Explanation of Provisions

Overview

The final regulations provide guidanceconcerning the application for tax exemp-tion and annual information returns a tax-exempt organization, other than a privatefoundation, must make available for pub-lic inspection and must supply in responseto requests for copies. The final regula-tions also provide guidance on (1) theplace and time the organization mustmake these documents available for pub-lic inspection, (2) conditions the organiza-tion may place on requests for copies ofthe documents, and (3) the amount, formand time of payment of any fees the orga-nization may charge. The final regula-tions also prescribe how an organizationcan make its application for tax exemp-tion and annual information returnswidely available. Finally, the final regu-lations provide guidance on the standardsthat apply in determining whether an or-ganization is the subject of a harassmentcampaign and on the applicable proce-dures for obtaining relief from the generalrequirement that copies of documents beprovided in response to requests.

Application for Tax Exemption

A tax-exempt organization, other thanone that is a private foundation, mustmake its application for tax exemptionavailable pursuant to these final regula-tions. An application for tax exemptionincludes the application form (such asForm 1023 or Form 1024) and any sup-porting documents filed by, or on behalfof, the organization in connection with itsapplication. It also includes any letter ordocument issued by the IRS in connectionwith the application. Consistent with theguidance provided in Notice 88–120, if anorganization filed its application beforeJuly 15, 1987, the final regulations pro-vide that the organization is required tomake available a copy of its applicationonly if it had a copy of the application onJuly 15, 1987.

Annual Information Returns

A tax-exempt organization, other thanone that is a private foundation, must

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make its three most recent annual infor-mation returns available pursuant to thesefinal regulations. Generally, an annual in-formation return includes Forms 990,990-EZ, 990-BL, and Form 1065. It alsoincludes, generally, all schedules and at-tachments filed with the IRS. An organi-zation is not required, however, to dis-close the parts of the return that identifynames and addresses of contributors tothe organization, nor is it required to dis-close Form 990-T.

A few commentators asked that thefinal regulations exempt certain items re-ported on an application for tax exemp-tion or an annual information return fromdisclosure. For example, one commenta-tor observed that only an organization de-scribed in section 501(c)(3) is required bystatute (section 6033) to report certaincompensation information. By contrast, itis the regulations under section 6033 thatrequire tax-exempt organizations de-scribed in other parts of section 501(c) orsection 501(d) to report certain compen-sation information. Accordingly, thecommentator asked that the final regula-tions require public disclosure of the com-pensation section of Form 990 only whenit is a statutory requirement, as opposed toa regulatory requirement, to report suchinformation. Because section 6104(d) re-quires, except for specific exceptions, dis-closure of all the information reported onan application or return, the IRS and theTreasury Department decided that requir-ing public disclosure of compensation in-formation required to be reported on anannual information return either by statuteor regulation is consistent with section6104(d).

One commentator requested that finalregulations require an organization thathas not been determined by the IRS to beexempt from taxation under section501(a) to make its application for tax ex-emption available for public inspectionand to provide copies upon request. Sec-tion 301.6104(e)–1(b)(3) of the proposedregulations provided that an organizationis not required to disclose its applicationfor tax exemption until the IRS deter-mines it is exempt from taxation. Section6104(d)(1) requires an organization todisclose its application for tax exemptiononly where it is exempt under section501(a). Thus, the statute does not requirean organization to disclose its application

for tax exemption while the application ispending or in a case where the IRS issuesan adverse determination. Accordingly,the IRS and the Treasury Department con-tinue to believe that the rule of the pro-posed regulation is consistent with thestatute and have decided not to changethis provision.

One commentator proposed that a spe-cial rule be included in the final regula-tions so that a religious or apostolic orga-nization described in section 501(d)would not be required to publicly disclosea Schedule K-1 of Form 1065 because itcontains taxpayer information with re-spect to the distributees (i.e., the ratableportions of the net income and expensesof the individual members of the organi-zation). After the submission of this com-ment, the Internal Revenue Service Re-structuring and Reform Act of 1998,Public Law 105–206 (112 Stat. 685) wasenacted. Section 6019 of this Actamended Code sections 6104(b) and6104(e) to provide specifically that orga-nizations described in section 501(d) arenot required to publicly disclose a Sched-ule K-1 filed by the organization. Consis-tent with this statutory modification ofsection 6104, the final regulations elimi-nate the requirement that a religious orapostolic organization described in sec-tion 501(d) disclose a Schedule K-1.

Place and Time Documents Must BeAvailable for Public Inspection

Section 6104(d) requires a tax-exemptorganization to make its documents avail-able for public inspection, and providecopies upon request, at its principal officeand at certain regional or district offices.Under Notice 88–120, certain sites whereservices are provided (such as day care orhealth care) are not treated as regional ordistrict offices for purposes of the publicinspection requirements, provided thatsuch sites do “not serve as offices of man-agement staff (other than managers in-volved solely in managing the specificservice of that service provider office).”The IRS and the Treasury Departmentrecognize that many tax-exempt organiza-tions maintain sites where their employ-ees or volunteers solely provide servicesthat further exempt purposes, includingservices provided directly to the public,but do not maintain administrative ormanagement staff at such sites necessary

to respond to public disclosure requests.Accordingly, the proposed regulations ex-panded the “service provider exception”of Notice 88–120 slightly. Under theproposed regulations, sites where the onlyservices provided further exempt pur-poses (such as day care, health care or sci-entific or medical research) were ex-cluded from the definition of a regional ordistrict office. Thus, under the proposedregulations, a research organization thatmaintains a laboratory used solely by in-dividuals conducting scientific researchon behalf of the organization would nothave to respond to public disclosure re-quests made at the laboratory even thoughthe researchers are not providing directservices to the public. However, a re-search organization would have a publicdisclosure obligation at a laboratory if theorganization also uses space at that loca-tion as offices for some of its manage-ment staff (other than those involvedsolely in managing the exempt functionactivities at the laboratory).

Several comments were received onthis topic. One commentator expressedthe view that the definition of regional ordistrict office in the proposed regulationswas reasonably well balanced. Othercommentators, however, expressed con-cern that this definition would reduce thenumber of sites from which the docu-ments could be obtained. One of thesecommentators expressed the view that ex-empting organizations from complyingwith public disclosure requests made atsites where employees engage solely inproviding exempt services would unnec-essarily complicate the determinationwhether an organization is required to re-spond to public disclosure requests at aparticular site. This commentator sug-gested that the final regulations treat anysite with 3 or more employees as a re-gional or district office where an organi-zation must respond to requests for publicinspection or copies. Another commenta-tor expressed the view that the exceptionfor sites dedicated solely to providing ex-empt services was reasonable, but sug-gested that the final regulations clarifywhat activities would constitute manage-ment activities that would require an or-ganization to respond to public disclosurerequests at the site.

The IRS and the Treasury Departmentbelieve that the “regional and district of-

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fice” rule of section 6104(d) was intendedto enhance the availability of documentsin the case of an organization that main-tains management staff at one or more of-fices in addition to its principal office.However, Congress explicitly recognizedthat the burden to an organization of com-plying with requests for public inspectionor copies made at small regional or dis-trict offices (those with fewer than 3 employees) would outweigh the publicbenefit of increased availability of thedocuments. This rationale applies equallyas well to certain sites of a tax-exempt or-ganization where its employees and vol-unteers engage solely in providing ser-vices that further exempt purposes andwhich do not serve as an office for man-agement staff. The IRS and the TreasuryDepartment believe the rule expressed inthe proposed regulations is consistentwith the intent of the statute and prior IRSguidance, particularly in light of the newprovisions that allow copies to be ob-tained by mail. Therefore, the rule of theproposed regulations is followed in thefinal regulations.

The proposed regulations prescribedhow an organization that does not main-tain a permanent office or whose officehas very limited hours during certaintimes of the year can comply with thepublic inspection requirements. The pro-posed regulations also provided rules con-cerning the conditions the organizationmay impose on public inspections that areconsistent with Notice 88–120. In this re-gard, the final regulations follow the pro-posed regulations.

The proposed regulations permitted aprincipal, regional, or district office of anorganization to use an agent to process re-quests for copies. One commentatorasked that the final regulations also allowa tax-exempt organization to retain a localagent to satisfy the organization’s publicinspection obligation. After careful con-sideration of this comment, the IRS andthe Treasury Department have concludedthat, to avoid potential inconvenience tomembers of the public, it is important thattax-exempt organizations make their ap-plications and returns available for in-spection at their offices. Therefore, theIRS and the Treasury Department did notadopt this comment.

Another commentator asked that thefinal regulations clarify that an organiza-

tion may apply the same security mea-sures to individuals that request inspectionor copies that it applies to the public ingeneral. The IRS and the Treasury De-partment have determined that the pro-posed regulations would not preclude atax-exempt organization from implement-ing its normal security measures. Thus, nochange is reflected in the final regulations.

Requirement to Furnish Copy to aRequester

The proposed regulations generally re-quired that a tax-exempt organization ac-cept requests for copies made in person atthe same place and time that the specifieddocuments must be available for publicinspection. In general, the proposed regu-lations required that the copies be pro-vided on the day of the request. However,the proposed regulations provided that, inunusual circumstances, an organizationmay provide the requested copies on thenext business day. Some commentatorsexpressed concern that a one-day delaymay not be sufficient. In response tothese comments, the final regulations pro-vide that an organization must complywith requests for copies made in personby providing copies no later than the nextbusiness day following the day the un-usual circumstances cease to exist. How-ever, in no event may the period of delayexceed five business days. In response toanother comment, the final regulationsclarify that unusual circumstances includetimes when the organization’s managerialstaff capable of fulfilling the request at-tends an off-site meeting or convention.

When a request for copies is made inwriting, the proposed regulations requiredthat a tax-exempt organization mail thecopies within 30 days from the date it re-ceives the request. However, the pro-posed regulations provided that, if an or-ganization requires advance payment of areasonable fee for copying and postage, itmay provide the copies within 30 daysfrom the date it receives payment, ratherthan from the date of the initial request.In addition, the proposed regulations pro-vided guidance as to what constitutes a re-quest, when a request is considered re-ceived, and when copies are deemedprovided. The final regulations follow therules in the proposed regulations.

The proposed regulations provided thatindividuals may request a specific part of

an application for tax exemption or an-nual information return. One commenta-tor expressed concern that requiring a tax-exempt organization to provide a copy ofonly part of a document may create a sig-nificant burden on the tax-exempt organi-zation because the organization wouldhave to identify the particular informationrequested. In order to minimize this po-tential burden, without requiring the re-quester to pay for a copy of parts of a doc-ument that the requester has no interest inobtaining, the final regulations permit arequester to request a copy of any specifi-cally identified part or schedule of an ap-plication or a return (except for informa-tion which is not subject to publicdisclosure under section 6104(d)(3)). Forexample, a requester may request a copyof Part V (List of Officers, Directors,Trustees and Key Employees) of Form990.

Reasonable Fee for Providing Copies

Section 6104(d)(1)(B) permits an orga-nization to charge a reasonable fee for thecost of copying and mailing documents inresponse to requests for copies. The pro-posed regulations stated that a fee wasreasonable only if it did not exceed thefees the IRS charges for copies of tax-ex-empt organization tax returns and relateddocuments. This fee is currently $1.00for the first page and $.15 for each subse-quent page. In addition, the proposed reg-ulations allowed a charge for actualpostage costs. Some commentators re-quested that the reasonable fee be greaterthan the amount stated in the proposedregulations. One commentator suggestedthat the final regulations allow organiza-tions to consider personnel costs and notlimit the fee to the IRS charge. The IRSand the Treasury Department are con-cerned that permitting organizations tocharge a higher fee could hinder the pub-lic’s ability to receive a copy of an appli-cation or return. Consequently, it was de-cided that, on balance, the reasonable feeset forth in the proposed regulations is ap-propriate. Thus, the final regulationsadopt the reasonable fee provision of theproposed regulations.

The proposed regulations permitted anorganization to collect payment in ad-vance of providing the requested copies.Under the proposed regulations, if an or-

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ganization receives a written request forcopies with no payment enclosed, and theorganization requires payment in advance,the organization must request paymentwithin 7 days from the date it receives therequest. The proposed regulations re-quired an organization to accept paymentmade by cash or money order and, whenthe request is made in writing, also acceptpayment made by personal check. An or-ganization is permitted to accept otherforms of payment. One commentatorasked for the elimination of the require-ment to accept a personal check becausean organization could be liable for bankcharges if there are insufficient funds tocover the personal check. The final regu-lations generally follow the proposed reg-ulations, except that the final regulationsprovide that a tax-exempt organizationthat accepts payment by credit card is notrequired to accept personal checks.

Consistent with the proposed regula-tions, the final regulations protect re-questers from unexpected fees where atax-exempt organization does not requireprepayment and where a requester doesnot enclose prepayment with a request, byrequiring that an organization must re-ceive consent from a requester before pro-viding copies for which the fee chargedfor copying and postage is in excess of$20.

Local and Subordinate Organizations

Some commentators stated that the pro-posed regulations were overly burden-some with respect to local or subordinateorganizations recognized as tax-exemptunder a group exemption letter or that filea group return pursuant to §1.6033–2(d)and Rev. Proc. 80–27 (1980–1 C.B. 677).Specifically, they objected to the require-ment that a local or subordinate organiza-tion make available copies of documentssubmitted by the central or parent organi-zation to the IRS to include the local orsubordinate organization in the group rul-ing, which often consists of lengthy listsor directories of names and addresses ofaffiliated organizations. In addition, onecommentator expressed the view that theannual filing under Rev. Proc. 80–27 thata central or parent organization submits tothe IRS to cover a local or subordinate or-ganization under its group exemption let-ter does not constitute an application fortax exemption within the meaning of sec-

tion 6104(d)(2)(A). In response to thesecomments, the final regulations reducethe burden on local and subordinate orga-nizations. Under the final regulations, alocal or subordinate organization that re-ceives a request made in person for in-spection or for a copy of its applicationfor tax exemption is required to acquire,and make available within a reasonableamount of time (normally not more thantwo weeks), the application for a groupexemption letter (if any) filed by the cen-tral or parent organization. In addition, alocal or subordinate organization mustalso make available any documents sub-mitted by the central or parent organiza-tion to the IRS to include the subordinateorganization in the group ruling. How-ever, if the central or parent organizationsubmits a list or directory of organizationscovered by the group exemption letter, thelocal or subordinate organization needonly provide the application for group ex-emption and those pages of the list or di-rectory that refer to it. If a local or subor-dinate organization that does not file itsown annual information return but is cov-ered under a group return receives a re-quest made in person for inspection or fora copy of its annual information return,the local or subordinate organization mustmake its group return available for in-spection or provide copies within a rea-sonable amount of time (normally notmore than two weeks). However, if thegroup return includes separate scheduleswith respect to each local or subordinateorganization included in the group return,the local or subordinate organization re-ceiving the request may omit any sched-ules relating only to other organizationsincluded in the group return.

If the requester seeks inspection of anapplication for tax exemption or an an-nual information return, the local or sub-ordinate organization may mail a copy ofthe applicable document to the requesterwithin a reasonable amount of time (nor-mally not more than two weeks) in lieu ofallowing an inspection. In such a case,the local or subordinate organization maynot charge for the copies without the con-sent of the requester. A local or subordi-nate organization must comply with writ-ten requests for copies in accordance withthe general rules for written requests dis-cussed above.

The final regulations also clarify, con-sistent with Notice 88–120, the obligation

of the central or parent organization tocomply, at its principal office, with re-quests for inspection or copies of docu-ments relating to its local and subordinateorganizations.

Making Applications and InformationReturns Widely Available

The final regulations provide that a tax-exempt organization is not required tocomply with requests for copies if the or-ganization has made the requested docu-ments widely available. The final regula-tions specify that an organization canmake its application for tax exemptionand/or its annual information returnswidely available by posting the applicabledocument on the organization’s WorldWide Web page on the Internet or by hav-ing the applicable document posted on an-other organization’s World Wide Webpage as part of a database of similar mate-rials, provided that the documents areposted in a format which meets the crite-ria set forth in the final regulations. Anorganization that makes its application fortax exemption and/or its annual informa-tion returns widely available must providethe individuals who request copies withthe World Wide Web address where thedocuments are available.

The proposed regulations provided thatan organization must post its documentson its World Wide Web page in a formatthat the IRS uses to post forms and publi-cations. Unlike the proposed regulations,the final regulations do not enumerate oneor more particular formats that must beused. Instead, the final regulations pro-vide that the documents must be posted ina format that meets the following criteria.First, any individual with access to the In-ternet must be able to access, download,view and print the posted document in aformat which exactly reproduces theimage of the original document filed withthe IRS, except for any information per-mitted to be withheld from public disclo-sure under section 6104(d). The final reg-ulations require an exact reproductionbecause a format that does not exactly re-produce the image of the original docu-ment may raise questions about the accu-racy or authenticity of the posteddocument. Second, the format mustallow any individual with access to the In-ternet to access, download, view and printthe posted document without payment of

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a fee to either the tax-exempt organizationor the entity maintaining the World WideWeb page and without special computerhardware or software required for thatformat, other than software that is readilyavailable to members of the public free ofcharge.

The IRS and the Treasury Departmentunderstand that some of the formats thatthe IRS itself uses to post forms and pub-lications on the IRS World Wide Webpage may not satisfy the criteria specifiedin the final regulations. For example,some of these formats could require usersto have access to special hardware or soft-ware that is not commonly used by thepublic to access, download, view andprint documents. The final regulationsprovide a one-year transition rule for anytax-exempt organization that posted itsdocuments on the Internet on or beforeApril 9, 1999, in a manner consistent withthe proposed regulations. Until June 8,2000, such an organization will be treatedas having made its documents “widelyavailable” for purposes of the final regu-lations even if the format used does notcurrently satisfy all of the criteria set forthin the final regulations.

Some commentators suggested that thefinal regulations permit an organization topost its documents on the Internet inHTML format. As discussed above, theapproach of the final regulations is toidentify the criteria that an Internet formatmust satisfy. The IRS and the TreasuryDepartment understand that, currently,when a heavily formatted document, suchas a tax return, is posted in HTML format,it may not exactly reproduce the image ofthe original document.

One format that currently satisfies thecriteria set forth in the final regulations isPortable Document Format (PDF). PDFis designed to reproduce the image of theoriginal document exactly. In addition,documents in the PDF format can beviewed, navigated and printed by anyoneusing the freely available reader software.Of course, there may be other formats thatcurrently satisfy the criteria set forth inthe final regulations. The IRS and theTreasury Department refer to PDF onlyfor the purpose of illustrating an accept-able format. No inference should bedrawn that the IRS and the Treasury De-partment view PDF as an especially orsingularly qualified format, that IRS and

the Treasury Department endorse or war-rant a specific document format (or soft-ware used in connection with a format),or that use or failure to use a specific doc-ument format (or software used in con-nection with a format) will result in anypreferential treatment from the IRS or theTreasury Department. The IRS and theTreasury Department note that a specificformat that currently satisfies the ”widelyavailable” criteria set forth in the finalregulations may be altered such that it nolonger satisfies the “widely available” cri-teria in the future. Conversely, a specificformat that does not currently satisfy the“widely available” criteria may be refinedto satisfy the “widely available” criteria inthe future.

As technology advances, the IRS andthe Treasury Department anticipate thatan increasing number of formats willmeet the criteria set forth in the final regu-lations. Accordingly, the IRS and theTreasury Department do not intend tolimit technologies that organizations mayuse to post their documents as long as theposted document is readily and freely ac-cessible and appears, whether viewed onscreen or in print, exactly as the original.

The IRS and the Treasury Departmentwill continue to consider other additionalmethods by which applications and re-turns could be made widely available.Accordingly, the final regulations providethat the Commissioner may prescribe, byrevenue procedure or other guidance, ad-ditional methods that an organization canuse to make its application for tax exemp-tion and/or its annual information returnswidely available.

Harassment Campaigns

The proposed regulations providedguidance in determining whether a tax-exempt organization is the subject of a ha-rassment campaign such that requiringcompliance with requests for copies thatare part of the harassment campaignwould not be in the public interest. Gen-erally, the proposed regulations providedthat a harassment campaign exists wherethe relevant facts and circumstances showthat the purpose of a group of requestswas to disrupt the operations of the tax-exempt organization rather than to obtaininformation. The proposed regulationsalso contained examples that evaluated

whether particular situations constituted aharassment campaign and whether an or-ganization had a reasonable basis for be-lieving that a request was part of the ha-rassment campaign. The final regulationsretain this rule and the examples set forthin the proposed regulations.

The proposed regulations provided thatan organization may suspend compliancewith a request if the organization reason-ably believes that the request is part of aharassment campaign. Commentators ex-pressed concern that, if there is a delay inthe issuance of an IRS determination as towhether the organization’s belief is rea-sonable, the organization could be subjectto significant penalties for the interveningperiod. The final regulations do not limitthe penalties that may be retroactively im-posed in cases where an organization issubsequently determined to have lacked areasonable belief for suspending compli-ance. However, the IRS and the TreasuryDepartment recognize that it may be ap-propriate to mitigate penalties in certaincircumstances, especially where a delayin the issuance of a determination is com-pletely outside the control of the organi-zation requesting the determination. TheIRS intends to publish a revenue proce-dure that will provide additional detailconcerning harassment campaign deter-minations procedures and may prescriberules concerning the imposition and miti-gation of penalties.

The proposed regulations required anorganization to file an application for aharassment campaign determinationwithin 5 days after suspending compli-ance with a request that the organizationbelieves to be part of such harassmentcampaign. One commentator asked thatthe time period for filing an application beexpanded to either 10 or 15 business days.Another commentator observed, however,that such an extension of time would fur-ther delay compliance with requests forcopies that an organization reasonably be-lieves, but are determined not to be, partof a harassment campaign. The final reg-ulations require an organization to file anapplication for a harassment determina-tion within 10 business days after sus-pending compliance. The IRS and theTreasury Department believe that thistime period strikes an appropriate balanceby providing organizations sufficient timeto prepare and file an application without

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substantially delaying access to copies ofthe documents. In addition, the final reg-ulations allow an organization, withoutsubmitting an application, to disregard re-quests for copies in excess of two permonth or four per year made by a singleindividual or sent from a single address.

Some commentators asked for clarifi-cation concerning the period that an orga-nization may continue not to comply withrequests for copies that are part of a ha-rassment campaign once it has receivedsuch a determination. The IRS and theTreasury Department believe that the dis-trict director for the key district in whichthe organization’s principal office is lo-cated (or such other person as the Com-missioner may designate) should exercisereasonable discretion, based on the factsand circumstances of each case, in decid-ing the exact terms and conditions of aharassment campaign determination.Consequently, the final regulations do notchange this provision of the proposedregulations.

Various comments concerned the exam-ples of harassment campaigns and re-quests from members of the news media.In this regard, example 4 has been modi-fied to better illustrate that a request madeby a member of the news media is a strongfactor tending to indicate that the requestis not part of a harassment campaign.

Other Matters

The proposed regulations provided thatan individual denied inspection, or a copy,of an application for tax exemption or anannual information return could seek as-sistance from the IRS by providing to theDirector of the Exempt Organizations Di-vision a statement that describes the re-quest and the reason for the individual’sbelief that the denial was in violation ofthe legal requirements. The final regula-tions provide instead that such individualsshould send their statements directly tothe district director for the key district inwhich the principal office of the tax-ex-empt organization is located (or suchother person as the Commissioner maydesignate). Finally, various commentsraised questions regarding the availabilityof an administrative appeal of a harass-ment campaign determination andwhether harassment campaign applica-tions and determinations are publiclyavailable. Whether an administrative ap-

peal is available and whether a harass-ment campaign determination is publiclyavailable are matters beyond the scope ofthese regulations, but may be addressed insubsequent guidance.

Effective Date

The final regulations are effective June8, 1999.

Special Analyses

It is hereby certified that the collectionsof information in these regulations willnot have a significant economic impact ona substantial number of small entities.This certification is based on the fact thatthe average time required to maintain anddisclose the information required underthese regulations is estimated to be 30minutes for each tax-exempt organization.This estimate is based on the assumptionthat, on average, a tax-exempt organiza-tion will receive one request per year toinspect or provide copies of its applica-tion for tax exemption and its annual in-formation returns. Less than 0.001 per-cent of the tax-exempt organizationsaffected by these regulations will be sub-ject to the reporting requirements con-tained in the regulations. It is estimatedthat annually, approximately 1,000 tax-exempt organizations will make their doc-uments widely available by posting themon the Internet. In addition, it is estimatedthat annually, approximately 50 tax-ex-empt organizations will file an applicationfor a determination that they are the sub-ject of a harassment campaign such that awaiver of the obligation to provide copiesof their applications for tax exemptionand their annual information returns is inthe public interest. The average time re-quired to complete, assemble and file anapplication describing a harassment cam-paign is expected to be 5 hours. Becauseapplications for a harassment campaigndetermination will be filed so infre-quently, they will have no effect on theaverage time needed to comply with therequirements in these regulations. In ad-dition, a tax-exempt organization is al-lowed in these regulations to charge a rea-sonable fee for providing copies torequesters. Therefore, it is estimated thaton average it will cost tax-exempt organi-zations less than $10 per year to complywith these regulations, which is not a sig-

nificant economic impact. Therefore, aRegulatory Flexibility Analysis under theRegulatory Flexibility Act (5 U.S.C.chapter 6) is not required. Pursuant tosection 7805(f) of the Internal RevenueCode, the notice of proposed rulemakingpreceding these regulations was submit-ted to Small Business Administration forcomment on its impact on small business.

Drafting Information

The principal author of these regula-tions is Michael B. Blumenfeld, Office ofAssociate Chief Counsel (Employee Ben-efits and Exempt Organizations), IRS.Other personnel from the IRS and theTreasury Department also participated intheir development.

* * * * *

Adoption of Amendments to theRegulations

Accordingly, 26 CFR Parts 301 and602 are amended as follows:

PART 301—PROCEDURE ANDADMINISTRATION

Paragraph 1. The authority citation forpart 301 is amended by adding entries innumerical order to read as follows:

Authority: 26 U.S.C. 7805 * * *Section 301.6104(d)–4 also issued

under 26 U.S.C. 6104(e)(3);Section 301.6104(d)–5 also issued

under 26 U.S.C. 6104(e)(3); * * *Par. 2. Sections 301.6104(d)–2 through

301.6104(d)–5 are added to read as fol-lows:

§301.6104(d)–2 Table of contents.

This section lists captions contained in§§301.6104(d)–3 through 301.6104(d)–5.

§301.6104(d)–3 Public inspection anddistribution of applications for taxexemption and annual informationreturns of tax-exempt organizations(other than private foundations).

(a) In general.(b) Definitions.(1) Tax-exempt organization.(2) Private foundation.(3) Application for tax exemption.(i) In general.(ii) No prescribed application form.(iii) Exceptions.

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(iv) Local or subordinate organizations.(4) Annual information return.(i) In general.(ii) Exceptions.(iii) Returns more than 3 years old.(iv) Local or subordinate organizations.(5) Regional or district offices.(i) In general.(ii) Site not considered a regional or

district office.(c) Special rules relating to public in-

spection.(1) Permissible conditions on public in-

spection.(2) Organizations that do not maintain

permanent offices.(d) Special rules relating to copies.(1) Time and place for providing copies

in response to requests made in per-son.

(i) In general.(ii) Unusual circumstances.(iii) Agents for providing copies.(2) Request for copies in writing.(i) In general.(ii) Time and manner of fulfilling writ-

ten requests.(A) In general.(B) Request for a copy of parts of docu-

ment.(C) Agents for providing copies.(3) Fees for copies.(i) In general.(ii) Form of payment.(A) Request made in person.(B) Request made in writing.(iii) Avoidance of unexpected fees.(iv) Responding to inquiries of fees

charged.(e) Documents to be provided by re-

gional and district offices.(f) Documents to be provided by local

and subordinate organizations.(1) Applications for tax exemption.(2) Annual information returns.(3) Failure to comply.(g) Failure to comply with public in-

spection or copying requirements.(h) Effective date.

§301.6104(d)–4 Making applicationsand returns widely available.

(a) In general.(b) Widely available.(1) In general.(2) Internet posting.(i) In general.(ii) Transition rule.

(iii) Reliability and accuracy.(c) Discretion to prescribe other meth-

ods for making documents widelyavailable.

(d) Notice requirement.(e) Effective date.

§301.6104(d)–5 Tax-exemptorganization subject to harassmentcampaign.

(a) In general.(b) Harassment.(c) Special rule for multiple requests

from a single individual or address.(d) Harassment determination proce-

dure.(e) Effect of a harassment determina-

tion.(f) Examples.(g) Effective date.

§301.6104(d)–3 Public inspection anddistribution of applications for taxexemption and annual informationreturns of tax-exempt organizations(other than private foundations).

(a) In general. Except as otherwiseprovided in this section, if a tax-exemptorganization (as defined in paragraph(b)(1) of this section), other than a privatefoundation (as defined in paragraph (b)(2)of this section), filed an application forrecognition of exemption under section501, it shall make its application for taxexemption (as defined in paragraph (b)(3)of this section) available for public in-spection without charge at its principal,regional and district offices during regularbusiness hours. Except as otherwise pro-vided in this section, a tax-exempt organi-zation, other than a private foundation,shall make its annual information returns(as defined in paragraph (b)(4) of this sec-tion) available for public inspection with-out charge in the same offices during reg-ular business hours. Each annualinformation return shall be made avail-able for a period of three years beginningon the date the return is required to befiled (determined with regard to any ex-tension of time for filing) or is actuallyfiled, whichever is later. In addition, ex-cept as provided in §§301.6104(d)–4 and301.6104(d)–5, an organization shall pro-vide a copy without charge, other than areasonable fee for reproduction and actualpostage costs, of all or any part of any ap-

plication or return required to be madeavailable for public inspection under thisparagraph to any individual who makes arequest for such copy in person or in writ-ing. See paragraph (d)(3) of this sectionfor rules relating to fees for copies.

(b) Definitions. For purposes of apply-ing the provisions of section 6104(d), thissection and §§301.6104(d)–4 and301.6104(d)–5, the following definitionsapply:

(1) Tax-exempt organization. The termtax-exempt organization means any orga-nization that is described in section 501(c)or section 501(d) and is exempt from tax-ation under section 501(a).

(2) Private foundation. The term pri-vate foundation means a private founda-tion as defined in section 509(a).

(3) Application for tax exemption—(i)In general. Except as described in para-graph (b)(3)(iii) of this section, the termapplication for tax exemptionincludesany prescribed application form (such asForm 1023 or Form 1024), all documentsand statements the Internal Revenue Ser-vice requires an applicant to file with theform, any statement or other supportingdocument submitted by an organization insupport of its application, and any letteror other document issued by the InternalRevenue Service concerning the applica-tion (such as a favorable determinationletter or a list of questions from the Inter-nal Revenue Service about the applica-tion). For example, a legal brief submit-ted in support of an application, or aresponse to questions from the InternalRevenue Service during the applicationprocess, is part of an application for taxexemption.

(ii) No prescribed application form.Ifno form is prescribed for an organiza-tion’s application for tax exemption, theapplication for tax exemption includes—

(A) The application letter and copy ofthe articles of incorporation, declarationof trust, or other similar instrument thatsets forth the permitted powers or activi-ties of the organization;

(B) The organization’s bylaws or othercode of regulations;

(C) The organization’s latest financialstatements showing assets, liabilities, re-ceipts and disbursements;

(D) Statements describing the characterof the organization, the purpose for whichit was organized, and its actual activities;

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(E) Statements showing the sources ofthe organization’s income and receiptsand their disposition; and

(F) Any other statements or documentsthe Internal Revenue Service required theorganization to file with, or that the orga-nization submitted in support of, the ap-plication letter.

(iii) Exceptions. The term applicationfor tax exemptiondoes not include—

(A) Any application for tax exemptionfiled by an organization that the InternalRevenue Service has not yet recognized,on the basis of the application, as exemptfrom taxation under section 501 for anytaxable year;

(B) Any application for tax exemptionfiled before July 15, 1987, unless the orga-nization filing the application had a copyof the application on July 15, 1987; or

(C) Any material, including the mater-ial listed in §301.6104(a)-1(i) and infor-mation that the Secretary would be re-quired to withhold from publicinspection, that is not available for publicinspection under section 6104.

(iv) Local or subordinate organiza-tions. For rules relating to applicationsfor tax exemption of local or subordinateorganizations, see paragraph (f)(1) of thissection.

(4) Annual information return—(i) Ingeneral. Except as described in para-graph (b)(4)(ii) of this section, the termannual information returnincludes anexact copy of any return filed by a tax-ex-empt organization pursuant to section6033. It also includes any amended re-turn the organization files with the Inter-nal Revenue Service after the date theoriginal return is filed. The copy must in-clude all information furnished to the In-ternal Revenue Service on Form 990, Re-turn of Organization Exempt FromIncome Tax, or any version of Form 990(such as Forms 990-EZ or 990-BL exceptForm 990-T) and Form 1065, as well asall schedules, attachments and supportingdocuments, except for the name and ad-dress of any contributor to the organiza-tion. For example, the annual informationreturn includes Schedule A of Form 990(containing supplementary informationon section 501(c)(3) organizations), andthose parts of the return that show com-pensation paid to specific persons (cur-rently, Part V of Form 990 and Parts I andII of Schedule A of Form 990).

(ii) Exceptions. The term annual infor-mation returndoes not include ScheduleA of Form 990-BL, Form 990-T, ExemptOrganization Business Income Tax Re-turn, Schedule K-1 of Form 1065 or Form1120-POL, U.S. Income Tax Return ForCertain Political Organizations, and thereturn of a private foundation. See§301.6104(d)-1 for requirements relatingto public disclosure of private foundationannual returns.

(iii) Returns more than 3 years old.The term annual information returndoesnot include any return after the expirationof 3 years from the date the return is re-quired to be filed (including any exten-sion of time that has been granted for fil-ing such return) or is actually filed,whichever is later. If an organization filesan amended return, however, the amendedreturn must be made available for a periodof 3 years beginning on the date it is filedwith the Internal Revenue Service.

(iv) Local or subordinate organiza-tions. For rules relating to annual infor-mation returns of local or subordinate or-ganizations, see paragraph (f)(2) of thissection.

(5) Regional or district offices—(i) Ingeneral. A regional or district office isany office of a tax-exempt organization,other than its principal office, that haspaid employees, whether part-time orfull-time, whose aggregate number ofpaid hours a week are normally at least120.

(ii) Site not considered a regional ordistrict office. A site is not considered aregional or district office, however, if—

(A) The only services provided at thesite further exempt purposes (such as daycare, health care or scientific or medicalresearch); and

(B) The site does not serve as an officefor management staff, other than man-agers who are involved solely in manag-ing the exempt function activities at thesite.

(c) Special rules relating to public in-spection—(1) Permissible conditions onpublic inspection.A tax-exempt organi-zation may have an employee present inthe room during an inspection. The orga-nization, however, must allow the indi-vidual conducting the inspection to takenotes freely during the inspection. If theindividual provides photocopying equip-ment at the place of inspection, the orga-

nization must allow the individual to pho-tocopy the document at no charge.

(2) Organizations that do not maintainpermanent offices.If a tax-exempt orga-nization does not maintain a permanentoffice, the organization shall comply withthe public inspection requirements ofparagraph (a) of this section by making itsapplication for tax exemption and its an-nual information returns, as applicable,available for inspection at a reasonable lo-cation of its choice. Such an organizationshall permit public inspection within areasonable amount of time after receivinga request for inspection (normally notmore than 2 weeks) and at a reasonabletime of day. At the organization’s option,it may mail, within 2 weeks of receivingthe request, a copy of its application fortax exemption and annual information re-turns to the requester in lieu of allowingan inspection. The organization maycharge the requester for copying and ac-tual postage costs only if the requesterconsents to the charge. An organizationthat has a permanent office, but has no of-fice hours or very limited hours duringcertain times of the year, shall make itsdocuments available during those periodswhen office hours are limited or not avail-able as though it were an organizationwithout a permanent office.

(d) Special rules relating to copies—(1) Time and place for providing copies inresponse to requests made in-person—(i)In general. Except as provided in para-graph (d)(1)(iii) of this section, a tax-ex-empt organization shall provide copies ofthe documents it is required to provideunder section 6104(d) in response to a re-quest made in person at its principal, re-gional and district offices during regularbusiness hours. Except as provided inparagraph (d)(1)(ii) of this section, an or-ganization shall provide such copies to arequester on the day the request is made.

(ii) Unusual circumstances.In the caseof an in-person request, where unusualcircumstances exist such that fulfilling therequest on the same business day placesan unreasonable burden on the tax-ex-empt organization, the organization mustprovide the copies no later than the nextbusiness day following the day that theunusual circumstances cease to exist orthe fifth business day after the date of therequest, whichever occurs first. Unusualcircumstances include, but are not limited

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to, receipt of a volume of requests that ex-ceeds the organization’s daily capacity tomake copies; requests received shortlybefore the end of regular business hoursthat require an extensive amount of copy-ing; or requests received on a day whenthe organization’s managerial staff capa-ble of fulfilling the request is conductingspecial duties, such as student registrationor attending an off-site meeting or con-vention, rather than its regular administra-tive duties.

(iii) Agents for providing copies.Aprincipal, regional or district office of atax- exempt organization subject to the re-quirements of this section may retain alocal agent to process requests made inperson for copies of its documents. Alocal agent must be located within reason-able proximity of the applicable office. Alocal agent that receives a request made inperson for copies must provide the copieswithin the time limits and under the con-ditions that apply to the organization it-self. For example, a local agent generallymust provide a copy to a requester on theday the agent receives the request. Whena principal, regional or district office of atax-exempt organization using a localagent receives a request made in personfor a copy, it must immediately providethe name, address and telephone numberof the local agent to the requester. An or-ganization that provides this informationis not required to respond further to therequester. However, the penalty provi-sions of sections 6652(c)(1)(C), 6652(c)-(1)(D), and 6685 continue to apply to thetax-exempt organization if the organiza-tion’s local agent fails to provide the doc-uments as required under section 6104(d).

(2) Request for copies in writing—(i)In general. A tax-exempt organizationmust honor a written request for a copy ofdocuments (or the requested part) that theorganization is required to provide undersection 6104(d) if the request—

(A) Is addressed to, and delivered bymail, electronic mail, facsimile, or a pri-vate delivery service as defined in section7502(f) to a principal, regional or districtoffice of the organization; and

(B) Sets forth the address to which thecopy of the documents should be sent.

(ii) Time and manner of fulfilling writ-ten requests—(A) In general. A tax-ex-empt organization receiving a written re-quest for a copy shall mail the copy of the

requested documents (or the requestedparts of documents) within 30 days fromthe date it receives the request. However,if a tax-exempt organization requires pay-ment in advance, it is only required toprovide the copies within 30 days fromthe date it receives payment. For rules re-lating to payment, see paragraph (d)(3) ofthis section. In the absence of evidence tothe contrary, a request or payment that ismailed shall be deemed to be received byan organization 7 days after the date ofthe postmark. A request that is transmit-ted to the organization by electronic mailor facsimile shall be deemed received theday the request is transmitted success-fully. If an organization requiring pay-ment in advance receives a written re-quest without payment or with aninsufficient payment, the organizationmust, within 7 days from the date it re-ceives the request, notify the requester ofits prepayment policy and the amountdue. A copy is deemed provided on thedate of the postmark or private deliverymark (or if sent by certified or registeredmail, the date of registration or the date ofthe postmark on the sender’s receipt). Ifan individual making a request consents,a tax-exempt organization may provide acopy of the requested document exclu-sively by electronic mail. In such case,the material is provided on the date the or-ganization successfully transmits the elec-tronic mail.

(B) Request for a copy of parts of docu-ment. A tax-exempt organization mustfulfill a request for a copy of the organiza-tion’s entire application for tax exemptionor annual information return or any spe-cific part or schedule of its application orreturn. A request for a copy of less thanthe entire application or less than the en-tire return must specifically identify therequested part or schedule.

(C) Agents for providing copies. A tax-exempt organization subject to the re-quirements of this section may retain anagent to process written requests forcopies of its documents. The agent shallprovide the copies within the time limitsand under the conditions that apply to theorganization itself. For example, if theorganization received the request first(e.g., before the agent), the deadline forproviding a copy in response to a requestshall be determined by reference to whenthe organization received the request, not

when the agent received the request. Anorganization that transfers a request for acopy to such an agent is not required torespond further to the request. If the or-ganization’s agent fails to provide thedocuments as required under section6104(d), however, the penalty provisionsof sections 6652(c)(1)(C), 6652(c)(1)(D),and 6685 continue to apply to the tax-ex-empt organization.

(3) Fees for copies—(i) In general. Atax-exempt organization may charge areasonable fee for providing copies. A feeis reasonable only if it is no more than theper-page copying charge stated in§601.702(f)(5)(iv)(B) of this chapter (feecharged by the Internal Revenue Servicefor providing copies to a requester), plusno more than the actual postage costs in-curred by the organization to provide thecopies. Before the organization providesthe documents, it may require that the in-dividual requesting copies of the docu-ments pay the fee. If the organization hasprovided an individual making a requestwith notice of the fee, and the individualdoes not pay the fee within 30 days, or ifthe individual pays the fee by check andthe check does not clear upon deposit, theorganization may disregard the request.

(ii) Form of payment—(A) Requestmade in person.If a tax-exempt organi-zation charges a fee for copying (as per-mitted under paragraph (d)(3)(i) of thissection), it shall accept payment by cashand money order for requests made inperson. The organization may acceptother forms of payment, such as creditcards and personal checks.

(B) Request made in writing.If a tax-exempt organization charges a fee forcopying and postage (as permitted underparagraph (d)(3)(i) of this section), itshall accept payment by certified check,money order, and either personal checkor credit card for requests made in writ-ing. The organization may accept otherforms of payment.

(iii) Avoidance of unexpected fees.Where a tax-exempt organization doesnot require prepayment and a requesterdoes not enclose payment with a request,an organization must receive consentfrom a requester before providing copiesfor which the fee charged for copying andpostage exceeds $20.

(iv) Responding to inquiries of feescharged. In order to facilitate a re-

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quester ’s ability to receive copiespromptly, a tax-exempt organization shallrespond to any questions from potentialrequesters concerning its fees for copyingand postage. For example, the organiza-tion shall inform the requester of itscharge for copying and mailing its appli-cation for exemption and each annual in-formation return, with and without attach-ments, so that a requester may includepayment with the request for copies.

(e) Documents to be provided by re-gional and district offices.Except as oth-erwise provided, a regional or district of-fice of a tax-exempt organization mustsatisfy the same rules as the principal of-fice with respect to allowing public in-spection and providing copies of its appli-cation for tax exemption and annualinformation returns. A regional or districtoffice is not required, however, to makeits annual information return available forinspection or to provide copies until 30days after the date the return is required tobe filed (including any extension of timethat is granted for filing such return) or isactually filed, whichever is later.

(f) Documents to be provided by localand subordinate organizations–(1) Appli-cations for tax exemption. Except as oth-erwise provided, a tax-exempt organiza-tion that did not file its own applicationfor tax exemption (because it is a local orsubordinate organization covered by agroup exemption letter referred to in§1.508–1 of this chapter) must, upon re-quest, make available for public inspec-tion, or provide copies of, the applicationsubmitted to the Internal Revenue Serviceby the central or parent organization toobtain the group exemption letter andthose documents which were submittedby the central or parent organization to in-clude the local or subordinate organiza-tion in the group exemption letter. How-ever, if the central or parent organizationsubmits to the Internal Revenue Service alist or directory of local or subordinate or-ganizations covered by the group exemp-tion letter, the local or subordinate organi-zation is required to provide only theapplication for the group exemption rul-ing and the pages of the list or directorythat specifically refer to it. The local orsubordinate organization shall permitpublic inspection, or comply with a re-quest for copies made in person, within areasonable amount of time (normally not

more than 2 weeks) after receiving a re-quest made in person for public inspec-tion or copies and at a reasonable time ofday. In a case where the requester seeksinspection, the local or subordinate orga-nization may mail a copy of the applica-ble documents to the requester within thesame time period in lieu of allowing aninspection. In such a case, the organiza-tion may charge the requester for copyingand actual postage costs only if the re-quester consents to the charge. If thelocal or subordinate organization receivesa written request for a copy of its applica-tion for tax exemption, it must fulfill therequest in the time and manner specifiedin paragraph (d)(2) of this section. Therequester has the option of requestingfrom the central or parent organization, atits principal office, inspection or copies ofthe application for group exemption andthe material submitted by the central orparent organization to include a local orsubordinate organization in the group rul-ing. If the central or parent organizationsubmits to the Internal Revenue Service alist or directory of local or subordinate or-ganizations covered by the group exemp-tion letter, it must make such list or direc-tory available for public inspection, but itis required to provide copies only of thosepages of the list or directory that refer toparticular local or subordinate organiza-tions specified by the requester. The cen-tral or parent organization must fulfillsuch requests in the time and mannerspecified in paragraphs (c) and (d) of thissection.

(2) Annual information returns.A localor subordinate organization that does notfile its own annual information return (be-cause it is affiliated with a central or par-ent organization that files a group returnpursuant to §1.6033–2(d) of this chapter)must, upon request, make available forpublic inspection, or provide copies of,the group returns filed by the central orparent organization. However, if thegroup return includes separate scheduleswith respect to each local or subordinateorganization included in the group return,the local or subordinate organization re-ceiving the request may omit any sched-ules relating only to other organizationsincluded in the group return. The local orsubordinate organization shall permitpublic inspection, or comply with a re-quest for copies made in person, within a

reasonable amount of time (normally notmore than 2 weeks) after receiving a re-quest made in person for public inspec-tion or copies and at a reasonable time ofday. In a case where the requester seeksinspection, the local or subordinate orga-nization may mail a copy of the applica-ble documents to the requester within thesame time period in lieu of allowing aninspection. In such a case, the organiza-tion may charge the requester for copyingand actual postage costs only if the re-quester consents to the charge. If thelocal or subordinate organization receivesa written request for a copy of its annualinformation return, it must fulfill the re-quest by providing a copy of the group re-turn in the time and manner specified inparagraph (d)(2) of this section. The re-quester has the option of requesting fromthe central or parent organization, at itsprincipal office, inspection or copies ofgroup returns filed by the central or parentorganization. The central or parent orga-nization must fulfill such requests in thetime and manner specified in paragraphs(c) and (d) of this section.

(3) Failure to comply. If an organiza-tion fails to comply with the requirementsspecified in this paragraph, the penaltyprovisions of sections 6652(c)(1)(C),6652(c)(1)(D), and 6685 apply.

(g) Failure to comply with public in-spection or copying requirements.If atax-exempt organization denies an indi-vidual’s request for inspection or a copyof an application for tax exemption or anannual information return as requiredunder this section, and the individualwants to alert the Internal Revenue Ser-vice to the possible need for enforcementaction, the individual may provide a state-ment to the district director for the keydistrict in which the applicable tax-ex-empt organization’s principal office is lo-cated (or such other person as the Com-missioner may designate) that describesthe reason why the individual believes thedenial was in violation of the require-ments of section 6104(d).

(h) Effective date.This section is effec-tive June 8, 1999.

§301.6104(d)–4 Making applicationsand returns widely available.

(a) In general.A tax-exempt organiza-tion is not required to comply with a re-

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quest for a copy of its application for taxexemption or an annual information re-turn pursuant to §301.6104(d)–3(a) if theorganization has made the requested doc-ument widely available in accordancewith paragraph (b) of this section. An or-ganization that makes its application fortax exemption and/or annual informationreturn widely available must neverthe-less make the document available for public inspection as required under§301.6104(d)–3(a), as applicable.

(b) Widely available—(1) In general.A tax-exempt organization makes its ap-plication for tax exemption and/or an an-nual information return widely availableif the organization complies with the re-quirements specified in paragraph (b)(2)of this section, and if the organization sat-isfies the requirements of paragraph (d) ofthis section.

(2) Internet posting—(i) In general. Atax-exempt organization can make its ap-plication for tax exemption and/or an an-nual information return widely availableby posting the document on a World WideWeb page that the tax-exempt organiza-tion establishes and maintains or by hav-ing the document posted, as part of a data-base of similar documents of othertax-exempt organizations, on a WorldWide Web page established and main-tained by another entity. The documentwill be considered widely available onlyif–

(A) the World Wide Web page throughwhich it is available clearly informs read-ers that the document is available and pro-vides instructions for downloading it;

(B) the document is posted in a formatthat, when accessed, downloaded, viewedand printed in hard copy, exactly repro-duces the image of the application for taxexemption or annual information return asit was originally filed with the InternalRevenue Service, except for any informa-tion permitted by statute to be withheldfrom public disclosure. (See section6104(d)(3) and §301.6104(d)–3(b)(3) and(4)); and

(C) any individual with access to theInternet can access, download, view andprint the document without special com-puter hardware or software required forthat format (other than software that isreadily available to members of the publicwithout payment of any fee) and without

payment of a fee to the tax-exempt orga-nization or to another entity maintainingthe World Wide Web page.

(ii) Transition rule.A tax-exempt orga-nization that posted its application for taxexemption or its annual information re-turns on a World Wide Web page on orbefore April 9, 1999, in a manner consis-tent with regulation project REG–246250–96 (1997 C.B. 627) (see§601.601(d)(2) of this chapter) will betreated as satisfying the requirements ofparagraphs (b)(2)(i)(B) & (C) of this sec-tion until June 8, 2000, provided that anindividual can access, download, viewand print the document without paymentof a fee to the tax-exempt organization orto another entity maintaining the WorldWide Web page.

(iii) Reliability and accuracy.In orderfor the document to be widely availablethrough an Internet posting, the entitymaintaining the World Wide Web pagemust have procedures for ensuring the re-liability and accuracy of the documentthat it posts on the page and must takereasonable precautions to prevent alter-ation, destruction or accidental loss of thedocument when posted on its page. In theevent that a posted document is altered,destroyed or lost, the entity must corrector replace the document.

(c) Discretion to prescribe other meth-ods for making documents widely avail-able. The Commissioner, from time totime, may prescribe additional methods,other than an Internet posting meeting therequirements of paragraph (b)(2) of thissection, that a tax-exempt organizationmay use to make its documents widelyavailable.

(d) Notice requirement.If a tax-exemptorganization has made its application fortax exemption and/or an annual informa-tion return widely available it must notifyany individual requesting a copy wherethe documents are available (includingthe address on the World Wide Web, if ap-plicable). If the request is made in per-son, the organization shall provide suchnotice to the individual immediately. Ifthe request is made in writing, the noticeshall be provided within 7 days of receiv-ing the request.

(e) Effective date.This section is effec-tive June 8, 1999.

§301.6104(d)–5 Tax-exemptorganization subject to harassmentcampaign.

(a) In general. If the district directorfor the key district in which the organiza-tion’s principal office is located (or suchother person as the Commissioner maydesignate) determines that the organiza-tion is the subject of a harassment cam-paign and compliance with the requeststhat are part of the harassment campaignwould not be in the public interest, a tax-exempt organization is not required to ful-fill a request for a copy (as otherwise re-quired by §301.6104(d)–3(a)) that itreasonably believes is part of the cam-paign.

(b) Harassment. A group of requestsfor an organization’s application for taxexemption or annual information returnsis indicative of a harassment campaign ifthe requests are part of a single coordi-nated effort to disrupt the operations of atax-exempt organization, rather than tocollect information about the organiza-tion. Whether a group of requests consti-tutes such a harassment campaign de-pends on the relevant facts andcircumstances. Facts and circumstancesthat indicate the organization is the sub-ject of a harassment campaign include: asudden increase in the number of re-quests; an extraordinary number of re-quests made through form letters or simi-larly worded correspondence; evidence ofa purpose to deter significantly the orga-nization’s employees or volunteers frompursuing the organization’s exempt pur-pose; requests that contain language hos-tile to the organization; direct evidence ofbad faith by organizers of the purportedharassment campaign; evidence that theorganization has already provided the re-quested documents to a member of thepurported harassing group; and a demon-stration by the tax-exempt organizationthat it routinely provides copies of its doc-uments upon request.

(c) Special rule for multiple requestsfrom a single individual or address.A tax-exempt organization may disregard any re-quest for copies of all or part of any docu-ment beyond the first two received withinany 30-day-period or the first four receivedwithin any one-year-period from the sameindividual or the same address, regardless

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of whether the district director for the ap-plicable key district (or such other personas the Commissioner may designate) hasdetermined that the organization is subjectto a harassment campaign.

(d) Harassment determination proce-dure. A tax-exempt organization mayapply for a determination that it is thesubject of a harassment campaign and thatcompliance with requests that are part ofthe campaign would not be in the publicinterest by submitting a signed applica-tion to the district director for the key dis-trict where the organization’s principal of-fice is located (or such other person as theCommissioner may designate). The ap-plication shall consist of a written state-ment giving the organization’s name, ad-dress, employer identification number,and the name, address and telephonenumber of the person to contact regardingthe application. The application must de-scribe in detail the facts and circum-stances that the organization believes sup-port a determination that the organizationis subject to a harassment campaign. Theorganization may suspend compliancewith respect to any request for a copy ofits documents based on its reasonable be-lief that such request is part of a harass-ment campaign, provided that the organi-zation fi les an application for adetermination within 10 business daysfrom the day the organization first sus-pends compliance with respect to a re-quest that is part of the alleged campaign.In addition, the organization may suspendcompliance with any request it reasonablybelieves to be part of the harassment cam-paign until it receives a response to its ap-plication for a harassment campaign de-termination.

(e) Effect of a harassment determina-tion. If the appropriate district director(or such other person as the Commis-sioner may designate) determines that atax-exempt organization is the subject ofa harassment campaign and it is not in thepublic interest to comply with requeststhat are part of the campaign, such organi-zation is not required to comply with anyrequest for copies that it reasonably be-lieves is part of the campaign. This deter-mination may be subject to other termsand conditions set forth by the district di-rector (or such other person as the Com-missioner may designate). A person (as

defined in section 6652(c)(4)(C)) shallnot be liable for any penalty under sec-tions 6652(c)(1)(C), 6652(c)(1)(D) or6685 for failing to timely provide a copyof documents in response to a requestcovered in a request for a harassment de-termination if the organization fulfills therequest within 30 days of receiving a de-termination from the district director (orsuch other person as the Commissionermay designate) that the organization isnot subject to a harassment campaign.Notwithstanding the preceding sentence,if the district director (or such other per-son as the Commissioner may designate)further determines that the organizationdid not have a reasonable basis for re-questing a determination that it was sub-ject to a harassment campaign or reason-able belief that a request was part of thecampaign, the person (as defined in sec-tion 6652(c)(4)(C)) remains liable for anypenalties that result from not providingthe copies in a timely fashion.

(f) Examples. The provisions of thissection are illustrated by the following ex-amples:

Example 1. V, a tax-exempt organization, re-ceives an average of 25 requests per month forcopies of its three most recent information returns.In the last week of May, V is mentioned in a nationalnews magazine story that discusses information con-tained in V’s 1996 information return. From June 1through June 30, 1997 V receives 200 requests for acopy of its documents. Other than the sudden in-crease in the number of requests for copies, there isno other evidence to suggest that the requests arepart of an organized campaign to disrupt V’s opera-tions. Although fulfilling the requests will place aburden on V, the facts and circumstances do notshow that V is subject to a harassment campaign.Therefore, V must respond timely to each of the 200requests it receives in June.

Example 2. Y is a tax-exempt organization thatreceives an average of 10 requests a month forcopies of its annual information returns. FromMarch 1, 1997 to March 31, 1997, Y receives 25 re-quests for copies of its documents. Fifteen of the re-quests come from individuals Y knows to be activemembers of the board of organization X. In the pastX has opposed most of the positions and policiesthat Y advocates. None of the requesters have askedfor copies of documents from Y during the past year.Y has no other information about the requesters. Al-though the facts and circumstances show that someof the individuals making requests are hostile to Y,they do not show that the individuals have organizeda campaign that will place enough of a burden on Yto disrupt its activities. Therefore, Y must respondto each of the 25 requests it receives in March.

Example 3.The facts are the same as in Exam-ple 2, except that during March 1997, Y receives

100 requests. In addition to the fifteen requestsfrom members of organization X’s board, 75 of therequests are similarly worded form letters. Y dis-covers that several individuals associated with Xhave urged the X’s members and supporters, via theInternet, to submit as many requests for a copy ofY’s annual information returns as they can. Themessage circulated on the Internet provides a formletter that can be used to make the request. Both theappeal via the Internet and the requests for copiesreceived by Y contain hostile language. During thesame year but before the 100 requests were re-ceived, Y provided copies of its annual informationreturns to the headquarters of X. The facts and cir-cumstances show that the 75 form letter requests arecoordinated for the purpose of disrupting Y’s opera-tions, and not to collect information that has alreadybeen provided to an association representing the re-questers’ interests. Thus, the fact and circum-stances show that Y is the subject of an organizedharassment campaign. To confirm that it may disre-gard the 90 requests that constitute the harassmentcampaign, Y must apply to the applicable districtdirector (or such other person as the Commissionermay designate) for a determination. Y may disre-gard the 90 requests while the application is pend-ing and after the determination is received. How-ever, it must respond within the applicable timelimits to the 10 requests it received in March thatwere not part of the harassment campaign.

Example 4.The facts are the same as in Exam-ple 3, except that Y receives 5 additional requestsfrom 5 different representatives of the news mediawho in the past have published articles about Y.Some of these articles were hostile to Y. Normally,the Internal Revenue Service will not consider atax-exempt organization to have a reasonable beliefthat a request from a member of the news media ispart of a harassment campaign absent additionalfacts that demonstrate that the organization couldreasonably believe the particular requests from thenews media to be part of a harassment campaign.Thus, absent such additional facts, Y must respondwithin the applicable time limits to the 5 requeststhat it received from representatives of the newsmedia.

(g) Effective date. This section is ef-fective June 8, 1999.

PART 602–OMB CONTROLNUMBERS UNDER THEPAPERWORK REDUCTION ACT

Paragraph 3. The authority for part 602continues to read as follows:

Authority: 26 U.S.C. 7805.Par. 4. In §602.101, paragraph (b) is

amended by adding the following entriesin numerical order to the table to read asfollows:

§602.101 OMB Control numbers.

* * * * *(b) * * *

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CFR part or section Current OMBwhere identified and control No. described

* * * * *

301.6104(d)–3 . . . . . . . . . . . 1545–1560301.6104(d)–4 . . . . . . . . . . . 1545–1560301.6104(d)–5 . . . . . . . . . . . 1545–1560

* * * * *

Robert E. Wenzel,Deputy Commissioner of

Internal Revenue.

Approved April 8, 1999.

Donald C. Lubick,Assistant Secretary of

the Treasury (Tax Policy).

(Filed by the Office of the Federal Register on April8, 1999, 8:45 a.m., and published in the issue of theFederal Register for April 9, 1999, 64 F.R. 17279)

Electronic Funds Transfer—Temporary Waiver of Failure to Deposit Penalty for CertainTaxpayers

Notice 99–20

This notice provides guidance relatingto News Release IR–1999–27, issuedMarch 22, 1999, regarding application ofthe § 6656 failure to deposit penalty totaxpayers currently required to deposit byelectronic funds transfer.

In IR–1999–27, the Internal RevenueService announced that beginning July 1,1999, any taxpayer that is currently re-quired to deposit federal depository taxesby electronic funds transfer and that de-posited more than $200,000 in aggregatefederal depository taxes during calendaryear 1998 will be subject to the 10-per-cent § 6656 failure to deposit penalty ifthe taxpayer fails to make deposits byelectronic funds transfer.

The Service will not, however, imposethe § 6656 penalty on taxpayers that didnot deposit more than $200,000 in aggre-gate federal depository taxes during cal-endar year 1998 solely for the failure todeposit by electronic funds transfer. Thiswaiver applies only to deposit obligations

incurred after June 30, 1999, and on orbefore December 31, 1999. This waiverin no way affects the waiver announced inNotice 99–12, 1999–9 I.R.B. 44, coveringthe period beginning January 1, 1999, andending June 30, 1999.

BACKGROUND

Section 6302(h)(1)(A) provides that theSecretary will prescribe regulations nec-essary for the development and imple-mentation of an electronic funds transfersystem for the collection of depositorytaxes. Section 6302(h)(2) provides aphase-in schedule for the system.

Section 31.6302–1(h) of the Employ-ment Taxes and Collection of Income Taxat Source Regulations prescribes rules forimplementing an electronic funds transfersystem for the collection of depositorytaxes. Under the regulation, taxpayers arerequired to deposit taxes by electronicfunds transfer if the amount of their de-pository taxes in a specified earlier yearexceeds the applicable threshold amount.The regulation provides that taxpayerswith more than $50,000 of federal em-ployment tax deposits in calendar year1995 must use electronic funds transfer tomake deposits that are due on or after July1, 1997, and relate to return periods be-ginning on or after January 1, 1997. Tax-payers with more than $50,000 in em-ployment tax deposits in calendar year1996 must use electronic funds transfer tomake deposits of taxes that are due on orafter January 1, 1998, relating to returnperiods beginning on or after January 1,1998. Taxpayers with more than $50,000in employment tax deposits in calendaryear 1997 must use electronic funds trans-fer to make deposits of taxes that are dueon or after January 1, 1999, relating to re-turn periods beginning on or after January1, 1999.

In addition, under the regulations, tax-payers with no employment tax depositsin either 1995 or 1996, but with more than$50,000 in other federal tax deposits in ei-ther 1995 or 1996, must use electronicfunds transfer to make deposits of taxesthat are due on or after January 1, 1998,relating to return periods beginning on orafter January 1, 1998. Taxpayers with noemployment tax deposits in 1997, butwith more than $50,000 in other federaltax deposits in 1997, must use electronicfunds transfer to make deposits of taxes

that are due on or after January 1, 1999,relating to return periods beginning on orafter January 1, 1999.

Section 6656(a) provides that in thecase of any failure by any person to de-posit taxes on the prescribed date in anauthorized government depository, apenalty applies unless the failure is due toreasonable cause and not due to willfulneglect. Rev. Rul. 95–68, 1995–2 C.B.272, provides that, absent reasonablecause, a taxpayer that is required to de-posit federal taxes by electronic fundstransfer is subject to the 10-percent failureto deposit penalty if the taxpayer depositsthe taxes by means other than electronicfunds transfer.

Notice 97–43, 1997–2 C.B. 294, pro-vides that, in the case of taxpayers first re-quired to deposit electronically on or afterJuly 1, 1997, the Internal Revenue Ser-vice will not impose the 10-percent § 6656 penalty solely for the failure tomake the deposit electronically, providedthe deposit is otherwise made in a timelymanner. This waiver applies only to de-posit obligations incurred on or beforeDecember 31, 1997.

Section 931 of the Taxpayer Relief Actof 1997, Pub. L. No. 105–34, 111 Stat.881, provides that no penalty shall be im-posed under the Internal Revenue Codesolely by reason of a failure by a person touse the electronic fund transfer system es-tablished under § 6302(h) of the Code if(1) the person is a member of a class oftaxpayers first required to use such sys-tem on or after July 1, 1997, and (2) thefailure occurs before July 1, 1998.

Notice 98–30, 1998–22 I.R.B. 9, pro-vides that, in the case of taxpayers first re-quired to deposit electronically on or afterJuly 1, 1997, the Internal Revenue Ser-vice will not impose the 10-percent § 6656 penalty solely for the failure tomake the deposit electronically providedthe deposit is otherwise made in a timelymanner. This waiver applies only to de-posit obligations incurred on or beforeDecember 31, 1998.

Notice 99-12 provides that for taxpay-ers first required to make federal tax de-posits electronically on or after July 1,1997, the Service will not impose the 10-percent § 6656 penalty solely for the fail-ure to make those deposits by electronicfunds transfer provided the deposit is oth-erwise made in a timely manner. This

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waiver applies only to deposit obligationsincurred on or before June 30, 1999.

CONTINUED TEMPORARY WAIVEROF PENALTY FOR CERTAINTAXPAYERS

For taxpayers that did not deposit morethan $200,000 in aggregate federal deposi-tory taxes during calendar year 1998, theService will not impose the 10-percent § 6656 penalty solely for the failure tomake deposits by electronic funds transfer.However, a taxpayer will remain liable for

the § 6656 penalty (absent reasonablecause) if the taxpayer fails to make a re-quired deposit in a timely manner.

This waiver of the 10-percent § 6656penalty applies only to deposit obligationsincurred after June 30, 1999, and on orbefore December 31, 1999. The penaltywaiver includes deposits made after De-cember 31, 1999, provided the depositobligation was incurred on or before De-cember 31, 1999. The penalty waiver ap-plies to any taxpayer that did not depositmore than $200,000 in aggregate federal

depository taxes during calendar year1998, including a taxpayer that was firstrequired to deposit by electronic fundstransfer in 1995 or 1996.

DRAFTING INFORMATION

The principal author of this notice isVincent G. Surabian of the Office of As-sistant Chief Counsel (Income Tax andAccounting). For further information re-garding the penalty waiver, contact Mr.Surabian at (202) 622-4940 (not a toll-free call).

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April 26, 1999 18 1999–17 I.R.B.

26 CFR 601.105: Examination of returns andclaims for refund, credit, or abatement;determination of correct tax liability.(Also Part I, section 6511.)

Rev. Proc. 99–21

SECTION 1. PURPOSE

This revenue procedure describes theinformation that is required under § 6511(h)(2)(A) of the Internal RevenueCode in order to request suspension of theperiod of limitations under § 6511 forclaiming a credit or refund of tax due toan individual taxpayer’s financial disabil-ity. This information is required to besubmitted with the taxpayer’s claim forcredit or refund of tax.

SECTION 2. BACKGROUND

.01 Generally, under § 6511(a), a tax-payer must file a claim for credit or re-fund of tax within three years after thedate of filing a tax return or within twoyears after the date of payment of the tax,whichever period expires later.

.02 Section 6511(h), as added by § 3202 of the Internal Revenue ServiceRestructuring and Reform Act of 1998,Pub. L. No. 105–206, 112 Stat. 685 (July22, 1998), suspends the statute of limita-tions period for filing a claim for credit orrefund under § 6511(a) for any period ofan individual taxpayer’s life during whichthe taxpayer is unable to manage the tax-payer’s financial affairs because of amedically determinable mental or physi-cal impairment that can be expected to re-sult in death, or has lasted (or can be ex-pected to last) for a continuous period ofnot less than 12 months. Further, a tax-payer is not considered to be financiallydisabled during any period in which thetaxpayer’s spouse or any other person isauthorized to act on behalf of the taxpayerin financial matters. Section 6511(h)(2)-(A) requires that proof of the taxpayer’sfinancial disability be furnished to the In-ternal Revenue Service.

SECTION 3. SCOPE

This revenue procedure applies to indi-vidual taxpayers for any period of finan-cial disability, regardless of when it oc-curs, except if the taxpayer’s claim forcredit or refund was otherwise barred

(without regard to § 6511(h)) by opera-tion of any law or rule of law (includingres judicata) as of July 22, 1998, the date§ 6511(h) was enacted.

SECTION 4. PROCEDURE

Unless otherwise provided in IRSforms and instructions, the followingstatements are to be submitted with aclaim for credit or refund of tax to claimfinancial disability for purposes of § 6511(h).

(1) a written statement by a physi-cian (as defined in § 1861(r)(1) of the So-cial Security Act, 42 U.S.C. § 1395x(r)),qualified to make the determination, thatsets forth:

(a) the name and a description ofthe taxpayer’s physical or mental impair-ment;

(b) the physician’s medical opin-ion that the physical or mental impair-ment prevented the taxpayer from manag-ing the taxpayer’s financial affairs;

(c) the physician’s medical opin-ion that the physical or mental impair-ment was or can be expected to result indeath, or that it has lasted (or can be ex-pected to last) for a continuous period ofnot less than 12 months;

(d) to the best of the physician’sknowledge, the specific time period dur-ing which the taxpayer was prevented bysuch physical or mental impairment frommanaging the taxpayer’s financial affairs;and

(e) the following certification,signed by the physician:

I hereby certify that, to the best ofmy knowledge and belief, the aboverepresentations are true, correct, andcomplete. (2) A written statement by the person

signing the claim for credit or refund thatno person, including the taxpayer ’sspouse, was authorized to act on behalf ofthe taxpayer in financial matters duringthe period described in paragraph (1)(d)of this section. Alternatively, if a personwas authorized to act on behalf of the tax-payer in financial matters during any partof the period described in paragraph(1)(d), the beginning and ending dates ofthe period of time the person was so au-thorized.

SECTION 5. EFFECTIVE DATE

This revenue procedure is effective forclaims within the scope of this revenueprocedure filed on or after July 22, 1998.

SECTION 6. PAPERWORKREDUCTION ACT

The collections of information con-tained in this revenue procedure havebeen reviewed and approved by the Of-fice of Management and Budget (OMB)in accordance with the Paperwork Reduc-tion Act (44 U.S.C. § 3507) under controlnumber 1545–1649.

An agency may not conduct or sponsor,and a person is not required to respond to,a collection of information unless the col-lection of information displays a validOMB control number.

The collection of information is con-tained in section 4 of this revenue proce-dure. This information is required to es-tablish a taxpayer’s financial disability forpurposes of § 6511(h)(2)(A). The likelyrespondents are individual taxpayers andphysicians.

The estimated total annual reportingburden is 24,100 hours.

The estimated annual burden per re-spondent will vary from 15 minutes to 45minutes, depending on individual circum-stances, with an estimated average of 30minutes. The estimated number of re-spondents is 48,200.

The estimated annual frequency of re-sponses is on occasion.

Books and records relating to a collec-tion of information must be retained aslong as their contents may become mater-ial in the administration of any internalrevenue law. Generally, tax returns andreturn information are confidential, as re-quired by § 6103.

DRAFTING INFORMATION

The principal author of this revenueprocedure is Paul E. Tellier of the Officeof Assistant Chief Counsel (Income Taxand Accounting). For further informationregarding this revenue procedure contactMr. Tellier on (202) 622-4930 (not a toll-free call).

Part III. Administrative, Procedural, and Miscellaneous

IRB 1999-17 4/21/99 11:47 AM Page 18

Drafting Information

The principal author of this notice isTodd Newman of the Employee Plans Di-

vision. For further information regardingthis notice, call (202) 622-6076 between2:30 and 3:30 p.m. Eastern time (not a

toll-free number). Mr. Newman’s numberis (202) 622-8458 (also not a toll-freenumber).

1999–17 I.R.B. 19 April 26, 1999

Weighted Average Interest RateUpdate

Notice 99–21

Notice 88–73 provides guidelines for

determining the weighted average interest

rate and the resulting permissible range of

interest rates used to calculate current lia-bility for the purpose of the full fundinglimitation of § 412(c)(7) of the InternalRevenue Code as amended by the Om-nibus Budget Reconciliation Act of 1987and as further amended by the UruguayRound Agreements Act, Pub. L. 103–465(GATT).

The average yield on the 30-year Trea-sury Constant Maturities for March 1999is 5.58 percent.

The following rates were determinedfor the plan years beginning in the monthshown below.

90% to 105% 90% to 110%Weighted Permissible Permissible

Month Year Average Range Range

April 1999 6.11 5.50 to 6.42 5.50 to 6.72

IRB 1999-17 4/21/99 11:47 AM Page 19

April 26, 1999 20 1999–17 I.R.B.

Part IV. Items of General Interest Foundations Status of CertainOrganizations

Announcement 99–48The following organizations have

failed to establish or have been unable tomaintain their status as public charities oras operating foundations. Accordingly,grantors and contributors may not, afterthis date, rely on previous rulings or des-ignations in the Cumulative List of Orga-nizations (Publication 78), or on the pre-sumption arising from the filing of noticesunder section 508(b) of the Code. Thislisting does not indicate that the organiza-tions have lost their status as organiza-tions described in section 501(c)(3), eligi-ble to receive deductible contributions.

Former Public Charities.The followingorganizations (which have been treated asorganizations that are not private founda-tions described in section 509(a) of theCode) are now classified as private foun-dations:S A F E Foundation Inc., Orlando, FLS D Prism Dance Theatre, Philadelphia,

PAS O S Appeal for Life, Chicago, ILS T O PInc., Memphis, TNS T R I V E, Scotts Valley, CASacramento Area Volunteers in

Education, Sacramento, CASacramento Retirement Association,

Sacramento, CASafe Children-Strong Families Inc.,

Naples, FLSafe Haven Ministries Inc., Carrollton, ILSafe Space Committee, Penfield, NYSafety Village Iowa City-Coralville Inc.,

Iowa City, IASaint Tammany Sexual Assault Network

Inc., Covington, LASalama Fellowship Urban Ministries Inc.,

Nashville, TNSalem Inc., Minneapolis, MNSalem Social Services Corp., Memphis,

TNSalisbury Club, St. Louis, MOSalt Council Inc., Las Vegas, NVSalt Ministries Inc., Houston, TXSalt of the Earth Outreach Ministries,

East Hazel Crest, ILSample Soap Inc., Rochester, NYSan Angelo Code Blue Crime Watch Inc.,

San Angelo, TX

San Antonio Art Center, San Antonio, TXSan Diego Chapter Order of AHEPA No.

223, San Diego, CASan Diego County All Star Basketball

Club, Lemon Grove, CASan Francisco Irish Film Festival, Mill

Valley, CASan-Hi Junior All American Football

Inc., San Bernardino, CASan Juan Project, Salt Lake City, UTSandhill Estates Inc., Wheeler, TXSanta Cruz Mutual Housing Association,

Santa Cruz, CASanta Fe School for Deaf Dalmatians,

Santa Fe, NMSanta Society of Oakland, Bingham

Farms, MISao Paulo Association for the Rescue of

Kids Inc., Robinson, ILSavannah Support Council Inc.,

Savannah, GASavoreux Development Foundation Inc.,

Washington, DCScargro Home Inc., Columbus, OHSchleicher County Community Services

Council, Eldorado, TXSchoolhouse Inc., Cumberland Furnace,

TNSchuetz Teams Outreach International,

Richland, WAScience Enrichment Institute, Tulsa, OKScientific Games Inc. Employee Civic

Association, Alpharetta, GAScleroderma Federation of Ohio, Dayton,

OHScotia Dancers, New York, NYScottsdale Association of Men for the

Arts, Phoenix, AZSea Legs Inc., San Pedro, CASecond Chance Animal Rescue Inc.,

Lexington, NCSecond Chance Ranch Inc., Gadsden, ALSecond Chance Wildlife Center, West

Pittston, PASecond District Commerce Network Inc.,

St. Louis, MOSecond Sight International, Portland, ORSecond Wind Aviation Safety Foundation

Inc., East Patchogue, NYSection 5 Wrestling Organization Inc.,

Rush, NYSedalia Downtown Development

Incorporated, Sedalia, MOSedona Canyons Preservation

Association, Sedona, AZSeeds of Change, Chicago, IL

Sekvek Renewable EnergyEnvironmental Systems Non-Profit,Mineola, NY

Selected Readings in Oral andMaxillofacial Surgery Inc., Irving, TX

Self-Employment EconomicDevelopment Council Inc., Clarkston,WA

Self Help Crafts of the World Inc.,Harrisonburg, VA

Sellersburg Shop with a Cop Inc.,Sellersburg, IN

Seneca County AIDS Council, Tiffin, OHSenior Broadcast Communications Inc.,

Durham, NCSenior Citizen Center Inc. Pittsburg

Kansas, Pittsburg, KSSenior Citizen TR Fund of Blue Springs,

Blue Springs, MOSenior Citizens Association for

Information, Kansas City, MOSenior Citizens Center Board

Incorporated, Park Rapids, MNSenior Citizens Low Income Support

Group, Kernville, CASenior Housing Inc., Hampton, VASenior Meals Inc., Hampton, VASeniors Foundation, Fairfax, VASeniors Foundation Inc., Boston, MASeptember House, Rochester, NYSeraphim Dance Theatre Inc., Brooklyn,

NYSerbian American Medical and Dental

Society, Chicago, ILSerendipity Press, Mendota Heights, MNSerenity Oriented Alternative Residences

Inc., Jonesboro, GAService Club of Andover Inc., Andover,

MAServing Our Savior Ministries, Paris, ILSeth Pomeroy Family Ministries, Parker,

COSexual Abuse Intervention Network of

Lake County, Grays Lake, ILSeven Sisters Womens Environmental

Network, Chesterfield, NHSeventh Day Adventist Laymen

Association Inc., Silver Spring, MDShadduli Center Inc., Santa Fe, NMShady Brook Foundation Inc., Houston,

TXShakedown Alliance, Bloomfield Hills,

MIShare Foundation Inc., Pittsburgh, PAShare International Inc., Wheat Ridge,

CO

IRB 1999-17 4/21/99 11:47 AM Page 20

1999–17 I.R.B. 21 April 26, 1999

Sharing Hearts and Nurturing Elders,Antioch, CA

Sharon Soccer Association Inc., Sharon,MA

Shasta High School District BoosterFoundation, Redding, CA

Shattermask Theatre, St. Louis, MOShawnee Free-Net Inc., Carbondale, ILShawnee Gardens Tenants Association

Inc., Louisville, KYShe Company, Washington, DCShearer Elementary School Parent

Teacher Organization of Winchester,Winchester, KY

Shechinah Inc., Georgetown, DEShelbina Community Advancement

Corporation, Shelbina, MOShelby Christian Outreach Inc., Shelby,

OHShelby Valley Volunteer Fire Department

Inc., Robinson Creek, KYSheldon Park Neighborhood

Improvement Association, Muskegon,MI

Shelter Assistance Association Inc., SantaRosa, CA

Shelter Island Choristers, Shelter Island,NY

Shenandoah Bible Ministries, Mt.Crawford, VA

Shepard Fold Ministries Inc., Phoenix,NY

Shepherds Rest, Grover Beach, CASherburne Area Youth Soccer

Organization, Sherburne, NYSherman Street Housing Corporation,

Gorham, MEShowtime Express Community Theatre,

Granite City, ILShrewsbury School Foundation Inc.,

Washington, DCSidney-Shelby County Business

Advisory Council Inc., Sidney, OHSierra County Eldercare Services

Corporation, Truth or Consequences,NM

Sierra Leone Relief Fund, Wilmington,DE

Sierra Nevada Balalaika Society Inc.,Reno, NV

Sierra Psychological Services, Reno, NVSilent Communicator Inc., Keene, TXSilkworth House Inc., Delmar, NYSilo Senior Citizens Inc., Durant, OKSilver Creek Community Services Inc.,

Carey, ID

Silver Moon Vintage Dance Ensemble,Minneapolis, MN

Silver Sands Productions Inc., OzonePark, NY

Silverstar Foundation, Colorado Springs,CO

Silvertone Ministries Inc., Sugar Land,TX

Simple Society, Nashua, NHSingle-Parent Family Adoption Society

of West Virginia, Martinsburg, WVSiouxlands Fantasy Christmas Inc., Sioux

City, IASisters, Lynchburg, VASisters-Crisis Pregnancy Ministry,

Lansing, MISix Thirty One Pieta Place Inc., Cranford,

NJSixth Avenue Baptist Education

Foundation, Birmingham, ALSlatington Community Ambulance

Service Inc., Slatington, PASolvak American Foundation for

Education and Science Inc., SanDiego, CA

Small World Child Care Center, Laurel,MS

Smith Childrens Charities, Greenwich,CT

W A I T-Workers Against InhumaneTreatment, Bismarck, ND

W F S Multi-Purpose Center FundingCorporation, Tuscaloosa, AL

Wadena County Child Safe, Wadena, MN

Wagarville Nutritional Center Inc.,Wagarville, AL

Walkersville Track Club Inc.,Walkersville, MD

Wally Russell Fund, Dallas, TXWalter Major Institute, Springfield, MOWalterboro Soccer Club Inc., Walterboro,

SCWandas Fund-the Fund for Women

Active in Our Nations Defense,Denver, CO

Warren Avenue Radio Patrol, Detroit, MIWashington Chapter of the Foundation

for North American Wild Sheep,Redmond, WA

Washington DC Association of UrbanBankers Foundation, Washington, DC

Washington Metropolitan Area Affiliateof the American, Washington, DC

Washington Refugee Resettlement,Seattle, WA

Watchung Hills Girls SoftballAssociation Inc., Warren, NJ

Watchung Mountain K-9 Search andRescue Inc., Florham Park, NJ

Waterboy Ministries, Las Vegas, NVWatkins Area Swimming Pool Inc.,

Watkins, MNWax Paragon, Saginaw, MIWay to Communicate, Chicago, ILWe Are the People, Houston, TXWeatherford Arts Council Association,

Weatherford, OKWeatherford Youth Camp Inc.,

Weatherford, TXWee Share Inc., Birmingham, ALWeequahic Park Association Inc.,

Newark, NJWellness Community-Inland Valley Inc.,

Upland, CAWellspring Incorporated, Alexandria, VAWere for Kids Organization, Bernardston,

MAWesley Daycare Center, Syracuse, NYWest African Child Development Fund

Inc., Silver Spring, MDWest Florin Place, Sacramento, CAWest Georgia Community Development

Corporation, Newnan, GAWest Hardin Senior Center, Hull, TXWest Haven Koaster Kar Race Inc., West

Haven, CTWest Haven Senior Basketball League

Inc., W. Haven, CTWest Hernando Youth Athletic Club Inc.,

Spring Hill, FLWest Michigan-St. Petersburg Region

International Exchange Council, EastGrand Rapids, MI

West Palm Beach Centennial CommitteeInc., West Palm Beach, FL

West Plains Boxing Club, W. Plains, MO

West Side Industrial Research &Retention Corporation, Chicago, IL

West Side Neighborhood DevelopmentAssociation Inc., Newark, NJ

West Side Operation Weed and SeedCorporation, Grand Rapids, MI

West Texas Freedom Corporation,Midland, TX

Westbrook Basketball Boosters,Westbrook, ME

Western New York Amateur SportsCommission Inc., Buffalo, NY

Western Pennsylvania CombinedTraining Association, Pittsburgh, PA

IRB 1999-17 4/21/99 11:47 AM Page 21

April 26, 1999 22 1999–17 I.R.B.

Western Pennsylvania Policy Forum,Erie, PA

Western Pennsylvania VeteransDevelopment Center, Johnstown, PA

Western Wake Senior Center Inc., Cary,NC

Westfield Police Association Inc.,Westfield, MA

Westside Alliance for Revitalization Inc.,Bartlesville, OK

Westside Community Church,Bloomington, IN

Westside Constituency Center, Newman,CA

Westwind Community Programs Inc.,Richmond, CA

Wharton Business School Club of LongIsland Inc., New York, NY

Whatcom County Fire District 10,Bellingham, WA

Whatever It Takes Inc., Endicott, NY

Wheeler Halfway House Inc., Houston,TX

Wheeling Works Inc., Wheeling, WVWhirlwind Ministries, Fort Worth, TXWhite County Correctional Ministry,

Searcy, ARWhite Deer Search and Rescue, New

Columbia, PAWhittier Inter-Faith Retirement Center,

Detroit, MIWhole Village Family Resource Center,

Plymouth, NHWholechild Parenting Inc., Denver, COWholeness Institute for Research and

Therapy Inc., Hurst, TXWilber D Mills Memorial Foundation,

Bryant, ARWilderness Experiences Inc., Kansas

City, KSWildlife Center of Houston Inc.,

Houston, TX

Wildlife Rehabilitators Association ofRhode Island Inc., N. Kingston, RI

Wiley Post Flight Number 46 Order ofDaedalians Inc., Tinker AFB, OKIf an organization listed above submits

information that warrants the renewal ofits classification as a public charity or as aprivate operating foundation, the InternalRevenue Service will issue a ruling or de-termination letter with the revised classi-fication as to foundation status. Grantorsand contributors may thereafter rely uponsuch ruling or determination letter as pro-vided in section 1.509(a)–7 of the IncomeTax Regulations. It is not the practice ofthe Service to announce such revised clas-sification of foundation status in the Inter-nal Revenue Bulletin.

IRB 1999-17 4/21/99 11:47 AM Page 22

1999–17 I.R.B. 23 April 26, 1999

Revenue rulings and revenue procedures(hereinafter referred to as “rulings”)that have an effect on previous rulingsuse the following defined terms to de-scribe the effect:

Amplified describes a situation whereno change is being made in a prior pub-lished position, but the prior position isbeing extended to apply to a variation ofthe fact situation set forth therein. Thus,if an earlier ruling held that a principleapplied to A, and the new ruling holdsthat the same principle also applies to B,the earlier ruling is amplified. (Comparewith modified, below).

Clarified is used in those instanceswhere the language in a prior ruling isbeing made clear because the languagehas caused, or may cause, some confu-sion. It is not used where a position in aprior ruling is being changed.

Distinguisheddescribes a situationwhere a ruling mentions a previouslypublished ruling and points out an essen-tial difference between them.

Modified is used where the substanceof a previously published position isbeing changed. Thus, if a prior rulingheld that a principle applied to A but notto B, and the new ruling holds that it ap-

plies to both A and B, the prior ruling ismodified because it corrects a publishedposition. (Compare with amplified andclarified, above).

Obsoleted describes a previously pub-lished ruling that is not considered deter-minative with respect to future transac-tions. This term is most commonly usedin a ruling that lists previously publishedrulings that are obsoleted because ofchanges in law or regulations. A rulingmay also be obsoleted because the sub-stance has been included in regulationssubsequently adopted.

Revoked describes situations where theposition in the previously published rul-ing is not correct and the correct positionis being stated in the new ruling.

Superseded describes a situation wherethe new ruling does nothing more thanrestate the substance and situation of apreviously published ruling (or rulings).Thus, the term is used to republish underthe 1986 Code and regulations the sameposition published under the 1939 Codeand regulations. The term is also usedwhen it is desired to republish in a singleruling a series of situations, names, etc.,that were previously published over a pe-riod of time in separate rulings. If the

new ruling does more than restate thesubstance of a prior ruling, a combinationof terms is used. For example, modifiedand superseded describes a situationwhere the substance of a previously pub-lished ruling is being changed in part andis continued without change in part and itis desired to restate the valid portion ofthe previously published ruling in a newruling that is self contained. In this casethe previously published ruling is firstmodified and then, as modified, is super-seded.

Supplemented is used in situations inwhich a list, such as a list of the names ofcountries, is published in a ruling andthat list is expanded by adding furthernames in subsequent rulings. After theoriginal ruling has been supplementedseveral times, a new ruling may be pub-lished that includes the list in the originalruling and the additions, and supersedesall prior rulings in the series.

Suspended is used in rare situations toshow that the previous published rulingswill not be applied pending some futureaction such as the issuance of new oramended regulations, the outcome ofcases in litigation, or the outcome of aService study.

AbbreviationsThe following abbreviations in current use and for-merly used will appear in material published in theBulletin.

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.

ERISA—Employee Retirement Income Security Act.

EX—Executor.

F—Fiduciary.

FC—Foreign Country.

FICA—Federal Insurance Contribution Act.

FISC—Foreign International Sales Company.

FPH—Foreign Personal Holding Company.

F.R.—Federal Register.

FUTA—Federal Unemployment Tax Act.

FX—Foreign Corporation.

G.C.M.—Chief Counsel’s Memorandum.

GE—Grantee.

GP—General Partner.

GR—Grantor.

IC—Insurance Company.

I.R.B.—Internal Revenue Bulletin.

LE—Lessee.

LP—Limited Partner.

LR—Lessor.

M—Minor.

Nonacq.—Nonacquiescence.

O—Organization.

P—Parent Corporation.

PHC—Personal Holding Company.

PO—Possession of the U.S.

PR—Partner.

PRS—Partnership.

PTE—Prohibited Transaction Exemption.

Pub. L.—Public Law.

REIT—Real Estate Investment Trust.

Rev. Proc.—Revenue Procedure.

Rev. Rul.—Revenue Ruling.

S—Subsidiary.

S.P.R.—Statements of Procedral Rules.

Stat.—Statutes at Large.

T—Target Corporation.

T.C.—Tax Court.

T.D.—Treasury Decision.

TFE—Transferee.

TFR—Transferor.

T.I.R.—Technical Information Release.

TP—Taxpayer.

TR—Trust.

TT—Trustee.

U.S.C.—United States Code.

X—Corporation.

Y—Corporation.

Z—Corporation.

Definition of Terms

IRB 1999-17 4/21/99 11:47 AM Page 23

April 26, 1999 24 1999–17 I.R.B.

1 A cumulative list of all revenue rulings, revenueprocedures, Treasury decisions, etc., published inInternal Revenue Bulletins 1998–1 through 1998–52will be found in Internal Revenue Bulletin 1999–1,dated January 4, 1999.

Numerical Finding List1

Bulletins 1999–1 through 1999–16

Announcements:

99–1, 1999–2 I.R.B. 4199–2, 1999–2 I.R.B. 4499–3, 1999–3 I.R.B. 1599–4, 1999–3 I.R.B. 1599–5, 1999–3 I.R.B. 1699–6, 1999–4 I.R.B.2499–7, 1999–2 I.R.B. 4599–8, 1999–4 I.R.B.2499–9, 1999–4 I.R.B. 2499–10, 1999–5 I.R.B. 6399–11, 1999–5 I.R.B. 6499–12, 1999–5 I.R.B. 6599–13, 1999–6 I.R.B. 1899–14, 1999–7 I.R.B.6099–15, 1999–8 I.R.B.7899–16, 1999–8 I.R.B. 8099–17, 1999–9 I.R.B. 5999–18, 1999–13 I.R.B. 2199–19, 1999–10 I.R.B. 6399–20, 1999–11 I.R.B.5399–21, 1999–11 I.R.B.5599–22, 1999–12 I.R.B. 3299–23, 1999–15 I.R.B. 799–24, 1999–14 I.R.B. 1299–25, 1999–12 I.R.B. 3599–26, 1999–14 I.R.B. 2099–27, 1999–13 I.R.B. 2299–28, 1999–13 I.R.B. 2599–29, 1999–13 I.R.B. 2599–30, 1999–13 I.R.B. 2699–31, 1999–13 I.R.B. 2699–32, 1999–14 I.R.B.2099–33, 1999–14 I.R.B. 2199–34, 1999–15 I.R.B. 899–35, 1999–14 I.R.B. 2299–36, 1999–16 I.R.B. 1099–37, 1999–15 I.R.B. 999–38, 1999–15 I.R.B. 999–39, 1999–15 I.R.B. 1099–40, 1999–16 I.R.B. 1099–41, 1999–16 I.R.B. 1099–42, 1999–16 I.R.B. 1199–43, 1999–16 I.R.B. 1199–44, 1999–16 I.R.B. 1299–45, 1999–16 I.R.B. 1299–46, 1999–16 I.R.B. 13

Notices:

99–1, 1999–2 I.R.B. 899–2, 1999–2 I.R.B. 899–3, 1999–2 I.R.B. 1099–4, 1999–3 I.R.B. 999–5, 1999–3 I.R.B. 1099–6, 1999–3 I.R.B. 1299–7, 1999–4 I.R.B.2399–8, 1999–5 I.R.B. 2699–9, 1999–4 I.R.B. 2399–10, 1999–6 I.R.B. 1499–11, 1999–8 I.R.B.5699–12, 1999–9 I.R.B. 4499–13, 1999–10 I.R.B. 2699–14, 1999–11 I.R.B.799–15, 1999–12 I.R.B.2099–16, 1999–13 I.R.B.1099–17, 1999–14 I.R.B.6

Notices—Continued

99–18, 1999–16 I.R.B. 499–19, 1999–16 I.R.B. 4

Proposed Regulations:

REG–209103–89, 1999–11 I.R.B. 10REG–209619–93, 1999–10 I.R.B. 28REG–245562–96, 1999–9 I.R.B. 45REG–104072–97, 1999–11 I.R.B. 12REG–114663–97, 1999–6 I.R.B. 15REG–114664–97, 1999–11 I.R.B. 21REG–116826–97, 1999–10 I.R.B. 40REG–118620–97, 1999–9 I.R.B. 46REG–120168–97, 1999–12 I.R.B. 21REG–121806–97, 1999–10 I.R.B. 46REG–100729–98, 1999–14 I.R.B. 9REG–104924–98, 1999–10 I.R.B.47REG–105964–98, 1999–12 I.R.B. 22REG–106177–98, 1999–12 I.R.B. 25REG–106219–98, 1999–9 I.R.B. 51REG–106386–98, 1999–12 I.R.B. 31REG–106388–98, 1999–11 I.R.B. 27REG–106564–98, 1999–10 I.R.B.53REG–106902–98, 1999–8 I.R.B. 57REG–106905–98, 1999–11 I.R.B. 39REG–110524–98, 1999–10 I.R.B. 55REG–111435–98, 1999–7 I.R.B. 55REG–113694–98, 1999–7 I.R.B. 56REG–111435–98, 1999–7 I.R.B. 55REG–113744–98, 1999–10 I.R.B. 59REG–114841–98, 1999–11 I.R.B. 41REG–115433–98, 1999–9 I.R.B. 54REG–116099–98, 1999–12 I.R.B. 34REG–116824–98, 1999–7 I.R.B.57REG–117620–98, 1999–7 I.R.B. 59REG–118662–98, 1999–13 I.R.B. 13REG–119192–98, 1999–11 I.R.B. 45REG–121865–98, 1999–8 I.R.B.63

Revenue Procedures:

99–1, 1999–1 I.R.B. 699–2, 1999–1 I.R.B. 7399–3, 1999–1 I.R.B. 10399–4, 1999–1 I.R.B. 11599–5, 1999–1 I.R.B. 15899–6, 1999–1 I.R.B. 18799–7, 1999–1 I.R.B. 22699–8, 1999–1 I.R.B. 22999–9, 1999–2 I.R.B. 1799–10, 1999–2 I.R.B. 1199–11, 1999–2 I.R.B. 1499–12, 1999–3 I.R.B. 1399–13, 1999–5 I.R.B. 5299–14, 1999–5 I.R.B. 5699–15, 1999–7 I.R.B. 4299–16, 1999–7 I.R.B. 5099–17, 1999–7 I.R.B. 5299–18, 1999–11 I.R.B.799–19, 1999–13 I.R.B.1099–20, 1999–14 I.R.B.799–22, 1999–15 I.R.B.599–23, 1999–16 I.R.B.5

Revenue Rulings:

99–1, 1999–2 I.R.B. 499–2, 1999–2 I.R.B. 599–3, 1999–3 I.R.B. 499–4, 1999–4 I.R.B.1999–5, 1999–6 I.R.B.899–6, 1999–6 I.R.B. 6

Revenue Rulings—Continued

99–7, 1999–5 I.R.B. 499–8, 1999–6 I.R.B.899–9, 1999–7 I.R.B.1499–10, 1999–10 I.R.B. 1099–11, 1999–10 I.R.B. 1899–12, 1999–11 I.R.B. 699–13, 1999–10 I.R.B. 499–14, 1999–13 I.R.B. 399–15, 1999–12 I.R.B.499–16, 1999–13 I.R.B.599–17, 1999–14 I.R.B. 499–18, 1999–14 I.R.B. 399–19, 1999–15 I.R.B. 3

Treasury Decisions:

8789, 1999–3 I.R.B. 58791, 1999–5 I.R.B. 78792, 1999–7 I.R.B.368793, 1999–7 I.R.B.158794, 1999–7 I.R.B.48795, 1999–7 I.R.B.88796, 1999–4 I.R.B. 168797, 1999–5 I.R.B. 58798, 1999–12 I.R.B. 168799, 1999–6 I.R.B. 108800, 1999–4 I.R.B. 208801, 1999–4 I.R.B. 58802, 1999–4 I.R.B. 108803, 1999–12 I.R.B. 158804, 1999–12 I.R.B. 58805, 1999–5 I.R.B. 148806, 1999–6 I.R.B.48807, 1999–9 I.R.B. 338808, 1999–10 I.R.B. 218809, 1999–7 I.R.B.278810, 1999–7 I.R.B.198811, 1999–10 I.R.B. 198812, 1999–8 I.R.B. 198813, 1999–9 I.R.B. 348814, 1999–9 I.R.B. 48815, 1999–9 I.R.B. 318816, 1999–8 I.R.B. 48817, 1999–8 I.R.B. 51

IRB 1999-17 4/21/99 11:47 AM Page 24

1999–17 I.R.B. 25 April 26, 1999

Finding List of Current Action onPreviously Published Items1

Bulletins 1999–1 through 1999–16

Notices:

92–36Modified by Rev. Proc.99–23, 1999–16 I.R.B. 5

96–64Modified by Rev. Proc.99–23, 1999–16 I.R.B. 5

98–39Modified by Rev. Proc.99–23, 1999–16 I.R.B. 5

98–52Modified by Rev. Proc.99–23, 1999–16 I.R.B. 5

99–5Modified by Rev. Proc.99–23, 1999–16 I.R.B. 5

Revenue Procedures:

78–10Obsoleted by99–12, 1999–3 I.R.B. 13

89–9Modified by99–23, 1999–16 I.R.B. 5

89–13Modified by99–23, 1999–16 I.R.B. 5

93–39, section 13Modified by99–23, 1999–16 I.R.B. 5

94–56Superseded by99–9, 1999–2 I.R.B. 17

95–12Modified by99–23, 1999–16 I.R.B. 5

97–23Superseded by99–3, 1999–1 I.R.B. 103

97–41Modified by99–23, 1999–16 I.R.B. 5

98–1Superseded by99–1, 1999–1 I.R.B. 6

98–2Superseded by99–2, 1999–1 I.R.B. 73

98–3Superseded by99–3, 1999–1 I.R.B. 103

98–4Superseded by99–4, 1999–1 I.R.B. 115

98–5Superseded by99–5, 1999–1 I.R.B. 158

Revenue Procedures—Continued

98–6Superseded by99–6, 1999–1 I.R.B. 187

98–7Superseded by99–7, 1999–1 I.R.B. 226

98–8Superseded by99–8, 1999–1 I.R.B. 229

98–14Modified by99–23, 1999–16 I.R.B. 5

98–22Modified and amplified by99–13, 1999–5 I.R.B. 52

98–28Obsoleted by (except as provided in section 5.02 of)99–22, 1999–15 I.R.B. 5

98–56Superseded by99–3, 1999–1 I.R.B. 103

98–63Modified by announcement99–7, 1999–2 I.R.B. 45

Revenue Rulings:

92–19Supplemented in part by99–10, 1999–10 I.R.B. 10

1 A cumulative finding list for previously publisheditems mentioned in Internal Revenue Bulletins1998–1 through 1998–52 will be found in InternalRevenue Bulletin 1999–1, dated January 4, 1999.

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April 26, 1999 26 1999–17 I.R.B.

Notes

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INTERNAL REVENUE BULLETINThe Introduction on page 3 describes the purpose and content of this publication. The weekly Internal Revenue Bulletin is sold

on a yearly subscription basis by the Superintendent of Documents. Current subscribers are notified by the Superintendent ofDocuments when their subscriptions must be renewed.

CUMULATIVE BULLETINSThe contents of this weekly Bulletin are consolidated semiannually into a permanent, indexed, Cumulative Bulletin. These are

sold on a single copy basis and are not included as part of the subscription to the Internal Revenue Bulletin. Subscribers to the week-ly Bulletin are notified when copies of the Cumulative Bulletin are available. Certain issues of Cumulative Bulletins are out of printand are not available. Persons desiring available Cumulative Bulletins, which are listed on the reverse, may purchase them from theSuperintendent of Documents.

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detach entire page, and mail to the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402. Pleaseallow two to six weeks, plus mailing time, for delivery.

WE WELCOME COMMENTS ABOUT THEINTERNAL REVENUE BULLETIN

If you have comments concerning the format or production of the Internal Revenue Bulletin or suggestions for improving it, wewould be pleased to hear from you. You can e-mail us your suggestions or comments through the IRS Internet Home Page(www.irs.ustreas.gov) or write to the IRS Bulletin Unit, OP:FS:FP:P:1, Room 5617, 1111 Constitution Avenue NW, Washington, DC 20224.

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