Federal rates; adjusted federal rates; adjusted federal long-term rate and the long-term exempt rate. For purposes of sections 382, 642, 1274, 1288, and other sections of the Code, tables set forth the rates for April 2004.

Final, temporary, and proposed regulations under section 168 of the Code provide guidance on how to depreciate MACRS property that is acquired in a like-kind exchange or as a result of an involuntary conversion. These regulations explain how a taxpayer should determine depreciation in the year of the exchange or involuntary conversion and subsequent years. A public hearing on the proposed regulations is scheduled for June 3, 2004. Notice 2000-4 obsoleted. REG-138499-02 partially withdrawn.

Final, temporary, and proposed regulations under section 168 of the Code provide guidance on how to depreciate MACRS property that is acquired in a like-kind exchange or as a result of an involuntary conversion. These regulations explain how a taxpayer should determine depreciation in the year of the exchange or involuntary conversion and subsequent years. A public hearing on the proposed regulations is scheduled for June 3, 2004. Notice 2000-4 obsoleted. REG-138499-02 partially withdrawn.

Temporary and proposed regulations under section 45D of the Code amend temporary regulations (T.D. 8971, 2002-1 C.B. 308) and proposed regulations (REG-119436-01, 2002-1 C.B. 377). These regulations provide revised rules relating to the new markets tax credit. A taxpayer making a qualified equity investment in a qualified community development entity that has received a new markets tax credit allocation may claim a 5-percent tax credit with respect to the qualified equity investment on each of the first 3 credit allowance dates and a 6-percent tax credit with respect to the qualified equity investment on each of the remaining 4 credit allowance dates. A public hearing is scheduled for June 2, 2004.

Temporary and proposed regulations under section 45D of the Code amend temporary regulations (T.D. 8971, 2002-1 C.B. 308) and proposed regulations (REG-119436-01, 2002-1 C.B. 377). These regulations provide revised rules relating to the new markets tax credit. A taxpayer making a qualified equity investment in a qualified community development entity that has received a new markets tax credit allocation may claim a 5-percent tax credit with respect to the qualified equity investment on each of the first 3 credit allowance dates and a 6-percent tax credit with respect to the qualified equity investment on each of the remaining 4 credit allowance dates. A public hearing is scheduled for June 2, 2004.

This procedure modifies the final withholding foreign partnership (WP) and withholding foreign trust (WT) agreements contained in Rev. Proc. 2003-64, 2003-32 I.R.B. 306, by eliminating the $200,000 cap on eligibility for certain pooled reporting. This procedure also makes a conforming change to the portion of the Qualified Intermediary (QI) withholding agreement contained in Rev. Proc. 2003-64. Rev. Proc. 2003-64 modified.

Proposed regulations under section 410(b) of the Code allow employees of a tax-exempt organization who are eligible to make salary reduction contributions to a section 403(b) plan to be treated as excludable employees for the purpose of testing whether a section 401(k) plan or a section 401(m) plan meets the minimum coverage requirements contained in section 410(b) if two conditions are met. This modification was directed by Congress in section 664 of the Economic Growth and Tax Relief Reconciliation Act of 2001.

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

Innovative Horizons, Inc., of Bartlesville, OK, no longer qualifies as an organization to which contributions are deductible under section 170 of the Code.

The Service announces that an updated edition of Publication 971, Innocent Spouse Relief (And Separation of Liability and Equitable Relief), revised March 2004, is now available. It replaces the July 2003 revision.