HIGHLIGHTS Bulletin No. 2021–26 OF THIS ISSUE June 28, 2021 These synopses are intended only as aids to the reader in identifying the subject matter covered. They may not be relied upon as authoritative interpretations. ADMINISTRATIVE EMPLOYEE PLANS Rev. Proc. 2021-27, page 1252. Notice 2021-37, page 1227. This procedure provides specifications for the private print- This notice sets forth updates on the corporate bond month- ing of red-ink substitutes for the 2021 revisions of certain ly yield curve, the corresponding spot segment rates for information returns. This procedure will be reproduced as June 2021 used under § 417(e)(3)(D), the 24-month average the next revision of Publication 1179. Revenue Procedure segment rates applicable for June 2021, and the 30-year 2020-35 is superseded. Treasury rates, as reflected by the application of § 430(h) (2)(C)(iv). ADMINISTRATIVE; INCOME TAX EMPLOYMENT TAX T.D. 9950, page 1221. These final regulations amend regulations under sections Rev. Proc. 2021-22, page 1231. 165 and 7508A, interpreting new section 7508A(d) relating General Rules and Specifications for Substitute Form 941, to mandatory postponements of time to perform time-sensi- Schedule B (Form 941), Schedule D (Form 941), Schedule R tive tax acts by reason of a federally declared disaster, and (Form 941), and Form 8974. This procedure provides gener- clarifying the definition of federally declared disaster under al rules and specifications from the IRS for paper and com- section 165(i)(5). The final regulations clarify that the phrase puter-generated substitutes for Form 941; Schedule B (Form “in the same manner as a period specified under [section 941); Schedule D (Form 941); Schedule R (Form 941); and 7508A(a)]” in section 7508A(d)(1) means that the time-sen- Form 8974. This procedure supersedes Revenue Procedure sitive acts postponed for the mandatory 60-day period are 2020-31, 2020-27 I.R.B. 12. those determined by the Secretary under section 7508A(a). The final regulations further provide that the mandatory 60- INCOME TAX day period will only apply if the Secretary bases her discre- tionary determination on a disaster declaration that specifies an incident date. The final regulations also clarify that the Notice 2021-36, page 1227. mandatory 60-day period cannot exceed the one-year limita- This Notice announces that the Treasury Department and the tion provided under section 7508A(a). Finally, the final regu- IRS intend to amend the regulations under sections 59A and lations clarify that a federally declared disaster includes an 6038A to defer the applicability date of certain provisions of event declared either a major disaster under section 401 of the regulations relating to the reporting of qualified derivative the Stafford Act or an emergency under section 501 of the payments until taxable years beginning on or after January Stafford Act. 1, 2023. Finding Lists begin on page ii. The IRS Mission Provide America’s taxpayers top-quality service by helping them understand and meet their tax responsibilities and en- force the law with integrity and fairness to all. Introduction The Internal Revenue Bulletin is the authoritative instrument against reaching the same conclusions in other cases unless of the Commissioner of Internal Revenue for announcing of- the facts and circumstances are substantially the same. ficial rulings and procedures of the Internal Revenue Service and for publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, and other items of The Bulletin is divided into four parts as follows: general interest. It is published weekly. Part I.—1986 Code. It is the policy of the Service to publish in the Bulletin all sub- This part includes rulings and decisions based on provisions stantive rulings necessary to promote a uniform application of the Internal Revenue Code of 1986. of the tax laws, including all rulings that supersede, revoke, modify, or amend any of those previously published in the Bulletin. All published rulings apply retroactively unless other- Part II.—Treaties and Tax Legislation. wise indicated. Procedures relating solely to matters of inter- This part is divided into two subparts as follows: Subpart A, nal management are not published; however, statements of Tax Conventions and Other Related Items, and Subpart B, internal practices and procedures that affect the rights and Legislation and Related Committee Reports. duties of taxpayers are published. Part III.—Administrative, Procedural, and Miscellaneous. Revenue rulings represent the conclusions of the Service To the extent practicable, pertinent cross references to these on the application of the law to the pivotal facts stated in subjects are contained in the other Parts and Subparts. Also the revenue ruling. In those based on positions taken in rul- included in this part are Bank Secrecy Act Administrative ings to taxpayers or technical advice to Service field offices, Rulings. Bank Secrecy Act Administrative Rulings are issued identifying details and information of a confidential nature are by the Department of the Treasury’s Office of the Assistant deleted to prevent unwarranted invasions of privacy and to Secretary (Enforcement). comply with statutory requirements. Part IV.—Items of General Interest. Rulings and procedures reported in the Bulletin do not have the This part includes notices of proposed rulemakings, disbar- force and effect of Treasury Department Regulations, but they ment and suspension lists, and announcements. may be used as precedents. Unpublished rulings will not be relied on, used, or cited as precedents by Service personnel in the disposition of other cases. In applying published rulings and The last Bulletin for each month includes a cumulative index procedures, the effect of subsequent legislation, regulations, for the matters published during the preceding months. These court decisions, rulings, and procedures must be considered, monthly indexes are cumulated on a semiannual basis, and are and Service personnel and others concerned are cautioned published in the last Bulletin of each semiannual period. The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate. June 28, 2021 Bulletin No. 2021–26 Part I 26 CFR 301.7508A-1: Postponement of certain FOR FURTHER INFORMATION ple (3), in these final regulations to better tax-related deadlines by reasons of a federally CONTACT: Andrew C. Keaton at (202) illustrate the calculation of the mandatory declared disaster or terroristic or military action; 26 CFR 1.165-1: Losses 317-5404 (not a toll-free number). 60-day postponement period and to cor- rect typographical errors. No other chang- T.D. 9950 SUPPLEMENTARY INFORMATION: es have been adopted. Background Comments on the Proposed DEPARTMENT OF THE Regulations TREASURY Section 205 of the Taxpayer Certainty and Disaster Tax Relief Act of 2019, en- Section 1.165-11(b)(1) Internal Revenue Service acted as Division Q of the Further Con- 26 CFR Parts 1 and 301 solidated Appropriations Act, 2020, Pub- The proposed regulations provided that lic Law 116-94, 133 Stat. 2534, 3226, a federally declared disaster includes both Mandatory 60-Day amended section 7508A of the Code, re- a major disaster and an emergency de- lating to the discretionary authority of the clared under sections 401 or 501, respec- Postponement of Certain Secretary of the Treasury or her delegate tively, of the Robert T. Stafford Disaster Tax-Related Deadlines (Secretary) to postpone certain time-sen- Relief and Emergency Assistance Act by Reason of a Federally sitive tax deadlines by reason of a feder- (Stafford Act), Public Law 100-707,102 Declared Disaster ally declared disaster, by adding section Stat. 4689 (1988). 7508A(d). This provision provides qual- One commenter said it approved of ified taxpayers a mandatory 60-day peri- the proposed regulations including emer- AGENCY: Internal Revenue Service od that is to be disregarded “in the same gency declarations in the definition of a (IRS), Treasury. manner as a period specified under [sec- federally declared disaster under section tion 7508A(a)].” 165(i)(5)(A). However, another comment- ACTION: Final regulations. On January 13, 2021, the IRS pub- er was critical of this portion of the pro- lished in the Federal Register a notice of posed regulations and recommended that SUMMARY: This document contains final proposed rulemaking (REG-115057-20, it be stricken. This second commenter said regulations relating to the new mandatory 86 FR 2607) to interpret and implement emergency declarations are governed by a 60-day postponement of certain time-sen- sections 165(i)(5) and 7508A(d). Five re- different set of rules than major disaster sitive tax-related deadlines by reason of a sponsive written comments were received. declarations, pointing out that emergency federally declared disaster. This document No commenter requested a public hearing, declarations (i) do not need to be preceded also contains final regulations clarifying so none was held. by a governor’s request for Stafford Act the definition of “federally declared disas- As described more fully in the pream- relief (but may instead be declared sua ter.” These final regulations affect individ- ble to the proposed regulations, section sponte by the President), (ii) may only re- uals who reside in or were killed or injured 7508A(d) is ambiguous in at least two im- sult (if not followed up by a major disaster in a disaster area, businesses that have a portant respects – the time-sensitive acts to declaration) in Federal assistance to local principal place of business in a disaster be postponed (beyond the pension-related governmental entities (as opposed to as- area, relief workers who provide assistance actions described in section 7508A(d)(4)) sistance to individuals), and (iii) may be in a disaster area, or any taxpayer whose are not specified and it is unclear how the issued before a disaster.