Guidance on Passive Foreign Investment Companies and Controlled Foreign Corporations Held by Domestic Partnerships and S Corporations and Related Person Insurance Income

Forms and Documents

Document Name	Status
2022 _SS_REG-118250-20_final_AG.docx Supporting Statement A	2022-01-31

IC Document Collections

IC ID	Document Title	Status
250842	S Corporation AE&P Amount Recordkeeping Requirement	New
250841	QEF or MTM Election by Partner or S Corporation Shareholder Notice Requirement	New

ICR Details

OMB Control No:	ICR Reference No: 202112-1545-008
Status: Received in OIRA	Previous ICR Reference No:
Agency/Subagency: TREAS/IRS	Agency Tracking No:
Title: Guidance on Passive Foreign Investment Companies and Controlled Foreign Corporations Held by Domestic Partnerships and S Corporations and Related Person Insurance Income
Type of Information Collection: New collection (Request for a new OMB Control Number)	Common Form ICR:  No
Type of Review Request: Regular	Date Submitted to OIRA: 01/31/2022

	Requested	Previously Approved
Expiration Date	36 Months From Approved
Responses	1,373,425	0
Time Burden (Hours)	686,713	0
Cost Burden (Dollars)	0	0

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Abstract: The collection of information in Prop Regs sections 1.1295-1(d)(2)(i)(A), 1.1295-1(d)(2)(ii)(A), and 1.1296-1(h)(1)(i)(A) is for partners or S corporation shareholders that own an interest in a PFIC through a partnership or S corporation to notify the partnership or S corporation that it has made a QEF or MTM election (under section 1295 or section 1296, respectively) with respect to the PFIC no later than 30 days after filing the return on which the election is made; notification of the election may be provided in any reasonable manner. Under §1.958-1(d), S corporations are not considered as owning CFC stock under section 958(a), and thus are not subject to inclusions under section 951 or section 951A. Proposed §1.958-1(e) permits an S corporation to elect to be treated as owning stock in a CFC under section 958(a) if it meets certain conditions, including having accumulated earnings and profits as of a certain date. This recordkeeping requires S corporations that make this election to maintain sufficient records substantiating their accumulated earnings and profits amount.

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Authorizing Statute(s): US Code: 26 USC 951A Name of Law: Global intangible low-taxed income included in gross income of United States shareholders
   US Code: 26 USC 951 Name of Law: Amounts included in gross income of United States shareholders
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
1545-BP94	Proposed rulemaking	87 FR 3890	01/25/2022

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Federal Register Notices & Comments

Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 2

IC Title	Form No.	Form Name
QEF or MTM Election by Partner or S Corporation Shareholder Notice Requirement
S Corporation AE&P Amount Recordkeeping Requirement

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ICR Summary of Burden

	Total Request	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	1,373,425	0	0	1,373,425	0	0
Annual Time Burden (Hours)	686,713	0	0	686,713	0	0
Annual Cost Burden (Dollars)	0	0	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: Yes

Burden Increase Due to: Changing Regulations

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: There is an increase in burden as this is a new NPRM and information collection.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Does this ICR request any personally identifiable information (see OMB Circular No. A-130 for an explanation of this term)? Please consult with your agency's privacy program when making this determination.     No

Does this ICR include a form that requires a Privacy Act Statement (see 5 U.S.C. §552a(e)(3))? Please consult with your agency's privacy program when making this determination.     No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? No

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Common Form ICR:  No

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On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).

The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(i) Why the information is being collected;

(ii) Use of information;

(iii) Burden estimate;

(iv) Nature of response (voluntary, required for a benefit, or mandatory);

(v) Nature and extent of confidentiality; and

(vi) Need to display currently valid OMB control number;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.

Certification Date: 01/31/2022

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