Final, temporary, and proposed regulations under sections 338 and 1060 of the Code will affect the treatment of certain nuclear decommissioning funds in the allocation of purchase price in deemed and actual asset acquisitions. The rule will not apply to nuclear decommissioning funds qualifying under section 468A. The new treatment is elective on the part of taxpayers.

Final, temporary, and proposed regulations under sections 338 and 1060 of the Code will affect the treatment of certain nuclear decommissioning funds in the allocation of purchase price in deemed and actual asset acquisitions. The rule will not apply to nuclear decommissioning funds qualifying under section 468A. The new treatment is elective on the part of taxpayers.

Proposed regulations under section 269B of the Code generally treat a stapled foreign corporation as a domestic corporation for U.S. federal income tax purposes, unless the stapled foreign corporation and the corresponding domestic stapled corporation are foreign-owned. Under the regulations, while a stapled foreign corporation is not an includible corporation under section 1504(b) for most purposes, it may be an includible corporation for purposes of regulations sections 1.904(i)-1 and 1.861-11T(d)(6). They also provide that a conversion of a domestic corporation to a foreign corporation (or vice versa) as a result of section 269B is treated as an F reorganization; limit the application of treaty benefits to stapled foreign corporations; provide special collection procedures for tax liabilities of stapled foreign corporations; address issues involving multiple classes of stock in determining whether a foreign corporation is a stapled foreign corporation; and provide the Commissioner with authority to disregard certain stapled stock structures involving related parties. A public hearing is scheduled for December 15, 2004.

This procedure describes the section 1441 Voluntary Compliance Program (VCP) which is available to certain withholding agents with respect to the withholding, payment, and reporting of certain taxes due on payments to foreign persons.

Proposed regulations relate to the predeceased parent rule, which provides an exception to the general rules of section 2651 of the Code for determining the generation assignment of a transferee of property for generation-skipping transfer (GST) purposes. The proposed regulations also provide rules regarding a transferee assigned to more than one generation. A public hearing is scheduled for December 14, 2004.

Parking reimbursements. This ruling holds that certain amounts paid to an employee as “reimbursements” for a parking expense that the employee supposedly “paid” through a salary reduction are wages for purposes of the Federal Insurance Contributions Act (FICA), the Federal Unemployment Tax Act (FUTA), and the collection of income tax at source on wages (federal income tax withholding).

This announcement provides the rates for various types of income under a new income tax treaty with Sri Lanka. The treaty is generally effective January 1, 2004. The tables in this announcement can be used, depending on the effective dates to supplement Tables 1 and 2 of Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities (For Withholding in 2004) and Publication 901, U.S. Tax Treaties.

Final regulations under section 6091 of the Code relate to the filing of hand-carried returns and other documents, remove references to IRS titles and organizational units that have been superseded, and replace them with updated references to offices and officers that are sufficiently flexible to take into account any future changes to structure or operations of the IRS.

Proposed regulations under section 269B of the Code generally treat a stapled foreign corporation as a domestic corporation for U.S. federal income tax purposes, unless the stapled foreign corporation and the corresponding domestic stapled corporation are foreign-owned. Under the regulations, while a stapled foreign corporation is not an includible corporation under section 1504(b) for most purposes, it may be an includible corporation for purposes of regulations sections 1.904(i)-1 and 1.861-11T(d)(6). They also provide that a conversion of a domestic corporation to a foreign corporation (or vice versa) as a result of section 269B is treated as an F reorganization; limit the application of treaty benefits to stapled foreign corporations; provide special collection procedures for tax liabilities of stapled foreign corporations; address issues involving multiple classes of stock in determining whether a foreign corporation is a stapled foreign corporation; and provide the Commissioner with authority to disregard certain stapled stock structures involving related parties. A public hearing is scheduled for December 15, 2004.

The Service is suspending certain income limitation requirements under section 42 of the Code for certain low-income housing credit properties in Florida as a result of the devastation caused by Hurricane Charley and Hurricane Frances.

Per diem allowances. This procedure provides rules for deeming substantiated the amount of certain reimbursed traveling expenses of an employee as well as optional rules for determining the amount of deductible meals and incidental expenses while traveling away from home. Rev. Proc. 2003-80 superseded.