Federal Employment Tax Deposits--
De Minimis Rule

DEPARTMENT OF THE TREASURY  
Internal Revenue Service 26 CFR Part 31 [REG-114423-00] RIN 1545-
AY47

TITLE: Federal Employment Tax Deposits--De Minimis Rule

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking by cross-reference to
temporary regulations.

SUMMARY: These proposed regulations affect taxpayers required to
make deposits of Federal employment taxes. This document contains
proposed regulations which change the de minimis deposit rule for
quarterly and annual return periods.

     In the Rules and Regulations section of this issue of the
Federal Register, the IRS is issuing temporary regulations relating
to the deposit of Federal employment taxes. The text of those
regulations also serves as the text of these proposed regulations.

DATES: Written or electronically generated comments and requests for
a public hearing must be received by Tuesday, March 6, 2001.

ADDRESSES: Send submissions to: CC:M&SP:RU (REG    B 114423-00),
room 5226, Internal Revenue Service, POB 7604, Ben Franklin Station,
Washington, DC 20044. Submissions may be hand delivered Monday
through Friday between the hours of 8 a.m. and 5 p.m. to: CC:M&SP:RU
(REG-114423-00), Courier�s Desk, Internal Revenue Service, 1111
Constitution Avenue, NW., Washington, DC. Alternatively, taxpayers
may submit comments electronically via the Internet by selecting the
A Tax Regs @ option on the IRS Home Page, or by submitting comments
directly to the IRS Internet site at
http://www.irs.gov/tax_regs/regslist.html.

FOR FURTHER INFORMATION CONTACT: Concerning the proposed
regulations, Brinton T. Warren, (202) 622-4940; concerning
submissions of comments and requests for a public hearing, Treena
Garrett of the Regulations Unit at (202) 622-7180 (not toll-free
numbers).

SUPPLEMENTARY INFORMATION:

Background and Explanation of Provisions

     Temporary regulations in the Rules and Regulations section of
this issue of the Federal Register amend the Employment Tax and
Collection of Income Tax at Source Regulations (26 CFR part 31)
relating to section 6302. The temporary regulations change the de
minimis rule for the deposit of Federal employment taxes. The text
of those regulations also serves as the text of these proposed
regulations. The preamble to the temporary regulations explains the
amendments.

Special Analyses

     It has been determined that this notice of proposed rulemaking
is not a significant regulatory action as defined in Executive Order
12866. Therefore, a regulatory assessment is not required. It also
has been determined that section 553(b) of the Administrative
Procedure Act (5 U.S.C. chapter 5) does not apply to these
regulations, and, because these regulations do not impose a
collection of information on small entities, the Regulatory
Flexibility Act (5 U.S.C. chapter 6) does not apply. Pursuant to
section 7805(f) of the Internal Revenue Code, this notice of
proposed rulemaking will be submitted to the Chief Counsel for
Advocacy of the Small Business Administration for comment on their
impact.

Comments and Requests for a Public Hearing

     Before these proposed regulations are adopted as final
regulations, consideration will be given to any written (a signed
original and 8 copies) and electronic comments that are submitted
timely to the IRS. The IRS and Treasury specifically request
comments on the clarity of the proposed regulations and how they can
be made easier to understand. All comments will be available for
public inspection and copying. A public hearing will be scheduled if
requested in writing by any person that timely submits comments. If
a public hearing is scheduled, notice of the date, time, and place
for the public hearing will be published in the Federal Register.

Drafting Information

     The principal author of the regulations is Brinton T. Warren of
the Office of Associate Chief Counsel, Procedure and Administration
(Administrative Provisions and Judicial Practice Division). However,
other personnel from the IRS and Treasury Department participated in
their development. List of Subjects in 26 CFR Part 31

     Employment taxes, Income taxes, Penalties, Pensions, Railroad
retirement, Reporting and recordkeeping requirements, Social
security, Unemployment compensation. Proposed Amendments to the
Regulations

     Accordingly, 26 CFR part 31 is proposed to be amended as
follows:

PART 31--EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT SOURCE

     Paragraph 1. The authority citation for part 31 continues to
read in part as follows:

     Authority: 26 U.S.C. 7805 * * *

     Par. 2. In �31.6302-1, paragraph (f)(4) is revised to read as
follows:

�31.6302-1 Federal tax deposit rules for withheld income taxes and
taxes under the Federal Insurance Contributions Act (FICA)
attributable to payments made after December 31, 1992.

* * * * *

     (f) * * *

     (4) [The text of proposed �31.6302-1(f)(4) is the same as the
text of �31.6302-1T(f)(4)].

* * * * *

Commissioner of Internal Revenue

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