Internal Revenue Bulletin 2012-3 (PDF rendition): IRS Revenue Procedures

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Bulletin No. 201
2-3
January 17, 2012
HIGHLIGHTS
OF THIS ISSUE
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.
INCOME TAX
Rev. Rul. 2012–2, page 286.
Federal rates; adjusted federal rates; adjusted federal
long-termrateandthelong-termexemptrate.For pur-
poses of sections 382, 642, 1274, 1288, and other sections
of the Code, tables set forth the rates for January 2012.
Notice 2012–3, page 289.
This notice provides guidance on current refunding issues (as
defined in Treas. Reg. section 1.150–1(d)(3)) that refund out-
standing prior issues of bonds that qualify for tax-exempt bond
financing under certain disaster relief bond programs. The no-
tice applies to current refunding issues that are used to refund
original tax-exempt bonds that met the qualification require-
ments for one of the following programs: (1) “qualified Gulf
Opportunity Zone Bonds” under section 1400N of the Code;
(2) “qualified Midwestern disaster area bonds” under section
702(d)(1) of the Heartland Disaster Tax Relief Act of 2008 (the
“Heartland Disaster Act”); and (3) “qualified Hurricane Ike disas-
ter area bonds” under section 704(a) of the Heartland Disaster
Act.
Notice 2012–5, page 291.
This notice provides a safe harbor reporting method that an eli-
giblerealestatemortgageinvestmentconduit(REMIC)mayuse
to satisfy its reporting obligations with respect to information
regarding REMIC assets that the REMIC must report to residual
interest holders.
Rev. Proc. 2012–13, page 295.
Maximum vehicle values.This procedure provides the max-
imum vehicle values for use with the special valuation rules un-
der regulations section 1.61–21(d) and (e). These values are
adjusted for inflation and must be adjusted annually by refer-
ence to the Consumer Price Index.
Rev. Proc. 2012–14, page 296.
Section 856 — REIT safe harbor for certain REMIC in-
vestments.Safe harbor providing the extent to which invest-
ments by a real estate investment trust (REIT) in a regular
or a residual interest in certain real estate mortgage invest-
ment conduits (REMICs) are qualifying investments and gener-
ate qualifying income for REIT purposes under section 856(c)
of the Code.
EMPLOYEE PLANS
Notice 2012–6, page 293.
This notice extends and expands the transition relief provided
under Rev. Rul. 2011–1, 2011–2 I.R.B. 251, and Rev. Rul.
2008–40, 2008–2 C.B. 166, for certain group trusts, certain
retirement trusts that qualify under the Puerto Rico Internal Rev-
enue Code, and that participate in group trusts, and certain
qualified retirement plans that benefit Puerto Rico residents.
This notice also provides additional time for governmental re-
tiree benefit plans described in section 401(a)(24) of the Code
(section 401(a)(24) plans) to be amended to satisfy the appli-
cable requirements of Rev. Rul. 2011–1. Rev. Ruls. 2011–1
and 2008–40 modified.
(Continued on the next page)
Actions Relating to Court Decisions is on the page following the Introduction.
Finding Lists begin on page ii.

EXEMPT ORGANIZATIONS
Notice 2012–4, page 290.
This notice notifies tax-exempt organizations that the IRS Mod-
ernized eFile system will not be available from January 1, 2012
through February 29, 2012 for electronic filing for Form 990,
Return of Organization Exempt From Income Tax, Form 990-EZ,
Short Form Return of Organization Exempt From Income Tax,
Form 990-PF,Return of Private Foundation, or Form 1120-POL,
U.S. Income Tax Return for Certain Political Organizations.In
addition, this notice describes options available to organiza-
tions affected by this two month suspension period and pro-
vides relief under sections 6081, 6651 and 6652 of the Code
with respect to certain filing requirements.
ADMINISTRATIVE
Rev. Proc. 2012–13, page 295.
Maximum vehicle values.This procedure provides the max-
imum vehicle values for use with the special valuation rules un-
der regulations section 1.61–21(d) and (e). These values are
adjusted for inflation and must be adjusted annually by refer-
ence to the Consumer Price Index.
January 17, 20122012–3 I.R.B.

The IRS Mission
Provide Americ
a’s taxpayers top-quality service by helping
them understa
nd and meet their tax responsibilities and en-
force the law wi
th integrity and fairness to all.
Introduction
The Internal Revenue Bulletin is the authoritative instrument of
the Commissioner of Internal Revenue for announcing official
rulings and procedures of the Internal Revenue Service and for
publishing Treasury Decisions, Executive Orders, Tax Conven-
tions, legislation, court decisions, and other items of general
interest. It is published weekly and may be obtained from the
Superintendent of Documents on a subscription basis. Bulletin
contents are compiled semiannually into Cumulative Bulletins,
which are sold on a single-copy basis.
It is the policy of the Service to publish in the Bulletin all sub-
stantive rulings necessary to promote a uniform application of
the tax laws, including all rulings that supersede, revoke, mod-
ify, or amend any of those previously published in the Bulletin.
All published rulings apply retroactively unless otherwise indi-
cated. Procedures relating solely to matters of internal man-
agement are not published; however, statements of internal
practices and procedures that affect the rights and duties of
taxpayers are published.
Revenue rulings represent the conclusions of the Service on the
application of the law to the pivotal facts stated in the revenue
ruling. In those based on positions taken in rulings to taxpayers
or technical advice to Service field offices, identifying details
and information of a confidential nature are deleted to prevent
unwarranted invasions of privacy and to comply with statutory
requirements.
Rulings and procedures reported in the Bulletin do not have the
force and effect of Treasury Department Regulations, but they
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
procedures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be considered,
and Service personnel and others concerned are cautioned
against reaching the same conclusions in other cases unless
the facts and circumstances are substantially the same.
The Bulletin is divided into four parts as follows:
Part I.—19
86 Code.
This part i
ncludes rulings and decisions based on provisions of
the Intern
al Revenue Code of 1986.
Part II.—Treaties and Tax Legislation.
This part is divided into two subparts as follows: Subpart A,
Tax Conventions and Other Related Items, and Subpart B, Leg-
islation and Related Committee Reports.
Part III.—Administrative, Procedural, and Miscellaneous.
To the extent practicable, pertinent cross references to these
subjects are contained in the other Parts and Subparts. Also
included in this part are Bank Secrecy Act Administrative Rul-
ings. Bank Secrecy Act Administrative Rulings are issued by
the Department of the Treasury’s Office of the Assistant Secre-
tary (Enforcement).
Part IV
.—Items of General Interest.
This par
t includes notices of proposed rulemakings, disbar-
ment an
d suspension lists, and announcements.
The last Bulletin for each month includes a cumulative index
for the matters published during the preceding months. These
monthly indexes are cumulated on a semiannual basis, and are
published in the last Bulletin of each semiannual period.
The c
ontents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.
For sale by the Superintendent of Documents, U.S.Government Printing Office, Washington, DC 20402.
2012–3 I.R.B.January 17, 2012

Actions Relati
ng to Decisions of the Tax Court
It is the policy
of the Internal Rev-
enue Service t
o announce at an early date
whether it wil
l follow the holdings in cer-
tain cases. An
Action on Decision is the
document maki
ng such an announcement.
An Action on De
cision will be issued at
the discreti
on of the Service only on unap-
pealed issue
s decided adverse to the gov-
ernment. Gen
erally, an Action on Decision
is issued whe
re its guidance would be help-
ful to Servi
ce personnel working with the
same or simi
lar issues. Unlike a Treasury
Regulation
or a Revenue Ruling, an Action
on Decision
is not an affirmative statement
of Service
position. It is not intended to
serve as pu
blic guidance and may not be
cited as pr
ecedent.
Actions on
Decisions shall be relied
upon withi
n the Service only as conclu-
sions appl
ying the law to the facts in the
particul
ar case at the time the Action on
Decision
was issued. Caution should be
exercise
d in extending the recommenda-
tion of th
e Action on Decision to similar
cases whe
re the facts are different. More-
over, th
e recommendation in the Action on
Decisio
n may be superseded by new legis-
lation,
regulations, rulings, cases, or Ac-
tions on
Decisions.
Prior to
1991, the Service published
acquies
cence or nonacquiescence only in
certain regula
r Tax Court opinions. The
Service has ex
panded its acquiescence
program to inc
lude other civil tax cases
where guidanc
e is determined to be help-
ful. Accordin
gly, the Service now may
acquiesce or n
onacquiesce in the holdings
of memorandu
m Tax Court opinions, as
well as those
of the United States District
Courts, Clai
ms Court, and Circuit Courts
of Appeal. Re
gardless of the court decid-
ing the case
, the recommendation of any
ActiononDe
cision will be published in
the Interna
l Revenue Bulletin.
The recomme
ndation in every Action
on Decision
will be summarized as ac-
quiescence
, acquiescence in result only,
or nonacqu
iescence. Both “acquiescence”
and “acqui
escence in result only” mean
that the Se
rvice accepts the holding of
the court i
n a case and that the Service
will foll
ow it in disposing of cases with
thesamec
ontrolling facts. However, “ac-
quiescen
ce” indicates neither approval
nor disap
proval of the reasons assigned
by the cou
rt for its conclusions; whereas,
“acquie
scence in result only” indicates
disagre
ement or concern with some or all
of those
reasons. “Nonacquiescence” sig-
nifies t
hat, although no further review was
sought,
the Service does not agree with
the hol
ding of the court and, generally,
will not follow
the decision in disposing
of cases invol
ving other taxpayers. In
reference to a
n opinion of a circuit court
of appeals, a “
nonacquiescence” indicates
that the Servi
ce will not follow the hold-
ingonanation
wide basis. However, the
Service will
recognize the precedential
impact of the
opinion on cases arising
within the ve
nue of the deciding circuit.
The Actions o
n Decisions published in
the weekly In
ternal Revenue Bulletin are
consolidate
d semiannually and appear in
the first Bu
lletin for July and the Cumula-
tive Bullet
in for the first half of the year. A
semiannual
consolidation also appears in
the first Bu
lletin for the following January
andintheC
umulative Bulletin for the last
half of the
year.
The Commis
sioner does ACQUIESCE
in the foll
owing decision:
Ronald And
rew Mayo and
Leslie Arc
her Mayo v.
Commissi
oner,
1
136 T.C. 81
(2011)
1
Acquiescence relating to the court’s holding that business expenses incurred by a professional gambler are deductible under section 162 of the Code and are not subject to section 165(d).
January 17, 20122012–3 I.R.B.

Part I. Rulings
and Decisions Under the Internal Revenue Code
of 1986
Section 42.—L
ow-Income
Housing Credi
t
The adjusted a
pplicable federal short-term, mid-
term, and long
-term rates are set forth for the month
of January 201
2. See Rev. Rul. 2012-2, page 286.
Section 280G.—Golden
Parachute Payments
Federal short-term, mid-term, and long-term rates
are set forth for the month of January 2012. See Rev.
Rul. 2012-2, page 286.
Section 382.—Limitation
on Net Operating Loss
Carryforwa
rds and Certain
Built-In Losses Following
Ownership Change
The adjusted applicable federal long-term rate is
set forth for the month of January 2012. See Rev.
Rul. 2012-2, page 286.
Section 412.—Minimum
Funding Standards
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 467.—Certain
Payments for the Use of
Property or Services
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 468.—Special
Rules for Mining and Solid
Waste
Reclamation and
Closi
ng Costs
The ad
justed applicable federal short-term, mid-
term,
and long-term rates are set forth for the month
of Jan
uary 2012. See Rev. Rul. 2012-2, page 286.
Section 482.—
Allocation
of Income and D
eductions
Among Taxpaye
rs
Federal short
-term, mid-term, and long-term rates
are set forth f
or the month of January 2012. See Rev.
Rul. 2012-2,
page 286.
Section 483.—Interest on
Certain Deferred Payments
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 642.—Special
Rules for Credits and
Deductions
Federal short-term, mid-term, and long-term rates
are set forth for the month of January 2012. See Rev.
Rul. 2012-2, page 286.
Section 807.—Rules for
Certain Reserves
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 846.—Discounted
Unpaid Losses Defined
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 1274.—Determi-
nation of Issue Price in the
Case of Certain Debt Instru-
ments Issued for Property
(Also Sections 42, 280G, 382, 412, 467, 468, 482,
483, 642, 807, 846, 1288, 7520, 7872.)
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 th
e Code, tables set forth the
rates for Janu
ary 2012.
Rev. Rul. 2012
–2
This revenue
ruling provides various
prescribed r
ates for federal income tax
purposes for
January 2012 (the current
month). Tabl
e 1 contains the short-term,
mid-term, an
d long-term applicable fed-
eral rates (
AFR) for the current month
for purpose
s of section 1274(d) of the
Internal Re
venue Code. Table 2 contains
the short-t
erm, mid-term, and long-term
adjusted a
pplicable federal rates (ad-
justed AFR
) for the current month for
purposes o
f section 1288(b). Table 3 sets
forth the a
djusted federal long-term rate
and the lo
ng-term tax-exempt rate de-
scribed i
n section 382(f). Table 4 contains
the appro
priate percentages for deter-
mining th
e low-income housing credit
describe
d in section 42(b)(1) for build-
ings pla
ced in service during the current
month. H
owever, under section 42(b)(2),
the appl
icable percentage for non-feder-
ally sub
sidized new buildings placed in
service
after July 30, 2008, and before
Decemb
er 31, 2013, shall not be less than
9%. Tab
le 5 contains the federal rate
for det
ermining the present value of an
annuit
y, an interest for life or for a term
of year
s, or a remainder or a reversionary
inter
est for purposes of section 7520.
Final
ly, Table 6 contains the deemed
rate o
f return for transfers made during
calen
dar year 2012 to pooled income funds
descr
ibed in section 642(c)(5) that have
been
in existence for less than 3 taxable
year
s immediately preceding the taxable
year
in which the transfer was made.
2012–3 I.R.B.286January 17, 2012

REV. RUL. 2012–2 TABLE 1
Applicable Federal Rates (AFR) for January 2012
Period for Compounding
AnnualSemiannualQuarterlyMonthly
Short-term
AFR.19%.19%.19%.19%
110% AFR.21%.21%.21%.21%
120% AFR.23%.23%.23%.23%
130% AFR
.25%.25%.25%.25%
Mid-term
AFR1.17%1.17%1.17%1.17%
110% AFR1.29%1.29%1.29%1.29%
120% AFR1.40%1.40%1.40%1.40%
130% AFR
1.53%1.52%1.52%1.52%
150% AFR
1.77%1.76%1.76%
1.75%
175% AFR
2.06%
2.05%
2.04%2.04%
Long-term
AFR2.63%2.61%2.60%2.60%
110% AFR2.89%2.87%2.86%
2.85%
120% AFR
3.15%
3.13%3.12%3.11%
130% AFR3.42%3.39%3.38%3.37%
REV. RUL. 2012–2 TABLE 2
Adjusted AFR for January 2012
Period for Compounding
Ann
ual
Sem
iannual
Qua
rterly
Mon
thly
Short-term adjusted
AFR
.38%.38%.38%.38%
Mid-term adjusted AFR
1.50%
1.49%1.49%1.49%
Long-term adjusted
AFR
3.47%3.44%3.43%3.42%
REV. RUL. 2012–2 TABLE 3
Rates Under Section 382 for January 2012
Adjusted federal long-term rate for the current month3.47%
Long-term tax-exempt rate for ownership changes during the current month (the highest of the adjusted
federal long-term rates for the current month and the prior two months.)3.55%
REV. RUL. 2012–2 TABLE 4
Appropriate Percentages Under Section 42(b)(1) for January 2012
Note: Under Section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after
July 30, 2008, and before December 31, 2013, shall not be less than 9%.
Appropriate percentage for the 70% present value low-income housing credit7.44%
Appropriate percentage for the 30% present value low-income housing credit3.19%
January 17, 20122872012–3 I.R.B.

REV. RUL. 2012–2 TABLE 5
Rate Under Section 7520 for January 2012
Applicable federal rate for determining the present value of an annuity, an interest for life or a term of years,
or a remainder or reversionary interest1.4%
REV. RUL. 2012–2 TABLE 6
Deemed Rate for Transfers to New Pooled Income Funds During 2012
Deemed rate of return for transfers during 2012 to pooled income funds that have been in existence for
less than 3 taxable years1.8%
Section 1288.—Treatment
of Original Issue Discount
on Tax-Exempt Obligations
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 7520.—Valuation
Tables
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
Section 7872.—Treatment
of Loans With Below-Market
Interest Rates
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month
of January 2012. See Rev. Rul. 2012-2, page 286.
2012–3 I.R.B.288January 17, 2012

Part III. Administrative, Procedural, and Miscellaneous
Current Refundings of
Tax-Exempt Bonds in Certain
Disaster Relief Bond Programs
Notice 2012–3
SECTION 1. PURPOSE
This notice provides guidance on “cur-
rent refunding issues” (as defined in
§ 1.150–1(d)(3)) that refund outstand-
ing prior issues of bonds that qualify for
tax-exempt bond financing under certain
disaster relief bond programs. In particu-
lar, this notice applies to current refunding
issues that are used (directly or indirectly
in a series of current refunding issues) to
refund original tax-exempt bonds that met
the qualification requirements for one of
the following programs: (1) qualified Gulf
Opportunity Zone Bonds under § 1400N
(“GO Zone Bonds”) of the Internal Rev-
enue Code (the “Code”); (2) qualified
Midwestern disaster area bonds under
§ 702(d)(1) of the Heartland Disaster Tax
Relief Act of 2008 (the “Heartland Disas-
ter Act”), Subtitle A of Title VII of the Tax
Extenders and Alternative Minimum Tax
Relief Act of 2008, Division C of Pub-
lic Law 110–343, 122 Stat. 3765 (2008)
(“Midwest Disaster Area Bonds”); and
(3) qualified Hurricane Ike disaster area
bonds under § 704(a) of the Heartland Dis-
aster Act (“Hurricane Ike Disaster Area
Bonds”). These original qualified tax-ex-
empt bonds are referredtocollectivelyin
this notice as “Qualified Bonds.”
SECTION 2. BACKGROUND
Section 101 of the Gulf Opportunity
Zone Act of 2005, Pub. L. No. 109–135,
119 Stat. 2577, 2578 (2005) (“GO Zone
Act”) added §§ 1400M and 1400N to the
Code to provide certain tax benefits in a
defined portion of the Hurricane Katrina
disaster area. Section 1400N(a)(2) autho-
rizes the issuance of tax-exempt GO Zone
Bonds. Section 1400N(a)(2) sets forth cer-
tain requirements for issuing these bonds,
including a requirement that such bonds be
“designated” as qualified GO Zone Bonds
by a specified State or local governmental
official or state bondcommission. Section
1400N(a)(3) imposes a bond volume cap
on the maximum aggregate face amount
of bonds that may be designated as qual-
ified GO Zone Bonds. Section 764 of
the Tax Relief, Unemployment Insurance
Reauthorization, and Job Creation Act of
2010, Pub. L. No. 111–312, 124 Stat.
3296, 3324 (2010), extended the dead-
line for the issuance of GO Zone Bonds
through December 31, 2011. For further
guidance on GO Zone Bonds,seeNotice
2006–41, 2006–1 C.B. 857 (May 1, 2006).
Sections 702(d)(1) and 704(a) of the
Heartland Disaster Act provide generally
that the special provisions for tax-exempt
private activity bond financing in the GO
Zone under § 1400N of the Code apply
with certain modifications to tax-exempt
private activity bond financing in the Mid-
western Disaster Area and Hurricane Ike
Disaster Area, respectively. Midwest Dis-
aster Area bonds and Hurricane Ike Dis-
aster Area bonds must be issued by De-
cember 31, 2012. For further guidance on
Midwest Disaster Area Bonds and Hurri-
cane Ike Disaster Area Bonds,seeNotice
2010–10, 2010–3 I.R.B. 299 (January 19,
2010).
The statutory provisions relating to
the Qualified Bonds are silent regarding
the permissibility of current refundings
of these bonds after the applicable bond
issuance deadlines. Under a substantially
similar predecessor provision for qualified
New York Liberty Bonds, the Treasury De-
partment and the IRS previously provided
guidance on the allowability of current
refundings within certain size limitations
for purposes of bond issuance deadlines
applicable to those bonds.SeeNotice
2003–40, 2003–2 C.B. 10, at Question 5
(July 7, 2003).Cf. Staff of Joint Commit-
tee on Taxation,Technical Explanation of
the Revenue Provisions of H.R. 4440, The
“Gulf Opportunity Zone Act of 2005,” as
Passed by the House of Representatives
and the Senate5–6, JCX–88–05 (Decem-
ber 16, 2005) (including a description of
the Liberty Bond provision in the discus-
sion of present law and also stating that
“[c]urrent refundings of outstanding [GO
Zone] bonds issued under the provision
do not count against the aggregate vol-
ume limit to the extent that the principal
amount of the refunding bonds does not
exceed the outstanding principal amount
of the bonds being refunded”).
SECTION 3. SCOPE AND
APPLICATION
3.01.Guidance and Reliance.Pending
the promulgation andeffective date of fu-
ture administrative or regulatory guidance,
taxpayers may rely on the guidance pro-
vided in this notice.
3.02.Scope of Application. This notice
applies to any current refunding issue that
is used (directly or indirectly in a series of
current refunding issues) to refund original
Qualified Bonds described in Section 1 of
this notice if the following requirements
are met:
(1) The original Qualified Bonds were
issued before the deadline for the issuance
of such bonds under § 1400N(a)(2)(D) for
GO Zone Bonds or under the modified ver-
sion of such provision for Midwest Disas-
ter Area Bonds or Hurricane Ike Disaster
Area Bonds, as applicable, or any statutory
extension of such deadline.
(2) Except as provided herein, the “is-
sue price” (as defined in § 1.148–1(b)) of
the current refunding issue is no greater
than the outstandingstated principal
amount of the refunded bonds. For re-
funded bonds originally issued with more
than ade minimisamount of original is-
sue discount or premium (as defined in
§ 1.148–1(b)) the present value of the
refunded bonds (as determined under
§ 1.148–4(e)) must be used in lieu of the
outstanding stated principal amount to
determine the maximum issue price of the
current refunding issue.
(3) The current refunding issue other-
wise meets all applicable requirements for
the issuance of tax-exempt private activ-
ity bonds as Qualified Bonds, including,
without limitation, the requirement under
§ 147(b) that the average bond maturity be
no longer than 120 percent of the average
reasonably expected economic life of the
facilities financed or refinanced with the
net proceeds of such issue.
3.03.Guidance. A current refunding
issue that meets the requirements of Sec-
tion 3.02 of this notice may be issued after
the specified deadline for the issuance
of the original Qualified Bonds under
§ 1400N(a)(2)(D) for GO Zone Bonds (or
under the modified version of such pro-
vision for Midwest Disaster Area Bonds
or Hurricane Ike Disaster Area Bonds,
January 17, 20122892012–3 I.R.B.

as applicable) and be treated as an issue
of Qualified Bonds. In addition, in the
case of such a current refunding issue,
a designation of the original Qualified
Bonds by a specified State or local govern-
mental official or state bond commission
that meets the designation requirement
of § 1400N(a)(2)(C) for GO Zone Bonds
(or the modified version of such provi-
sion for Midwest Disaster Area Bonds
or Hurricane Ike Disaster Area Bonds,
as applicable) is treated as meeting this
designation requirement for the current re-
funding issue without further designation
or further official State or local govern-
mental action.
3.04.No Inferences. Other than
bonds issued to currentlyrefundQuali-
fied Bonds, to which this notice expressly
applies, no inference should be drawn
from this notice that bonds issued to re-
fund other types of bonds, such as build
America bonds under § 54AA, after their
statutory deadline for issuance meet the
qualifications for such types of bonds.
SECTION 4. DRAFTING
INFORMATION
The principal authors of this notice
are Timothy L. Jones and Vicky Tsilas
of the Office of Associate Chief Counsel
(Financial Institutions & Products). For
further information regarding this notice,
contact Vicky Tsilas at (202) 622–3980
(not a toll-free call).
Certain Filing Changes for
Tax-Exempt Organizations
Notice 2012–4
This notice notifies tax-exempt organi-
zations (organizations) that the IRS Mod-
ernized eFile (MeF) system will not be
available from January 1, 2012 through
February 29, 2012 for electronic filing of
Form 990,Return of Organization Exempt
From Income Tax, Form 990–EZ,Short
Form Return of Organization Exempt From
Income Tax, Form 990–PF,Return of Pri-
vate Foundation, or Form 1120–POL,U.S.
Income Tax Return for Certain Political
Organizations(affected returns). In ad-
dition, this notice describes options avail-
able to organizations affected by this two
month suspension period and provides re-
lief under sections 6081, 6651, and 6652
of the Internal Revenue Code with respect
to certain filing requirements. This no-
tice also notifies tax-exempt hospital or-
ganizations that, beginning with the 2011
tax year, Form 990, Schedule H, Part V,
Section B (Part V.B) is no longer optional,
with the exception of lines 1 through 7.
Two-Month Suspension of IRS MeF
System for 990 and 1120–POL Filers
In order to facilitate systems and pro-
gramming changes, the IRS is suspend-
ing the availability of its MeF system for
filing Forms 990, 990–EZ, 990–PF, and
1120–POL from January 1, 2012 through
February 29, 2012 (the suspension period).
Although no organizations will be able to
file these forms electronically during the
suspension period, only organizations with
filing due dates (or extended due dates)
for such returns in the suspension period
are considered “affected organizations” for
purposes of this notice. Paper forms may
continue to be filed during the suspension
period and affected organizations may take
advantage of the relief provided in this no-
tice including the ability to file electron-
ically by March 30, 2012. Organizations
that file Form 990–N (e-Postcard) may
continue to file electronically during this
period.
Extended Filing Date for Eligible
Affected Organizations
In order to minimize the impact on
affected organizations, the IRS is grant-
ing an extension of time to file affected
returns to March 30, 2012 to organiza-
tions whose original due date (or first
three-month extended due date) for the
affected return occurs during the suspen-
sion period. The extension of time to
file applies to all such organizations with
affected return filings due during this pe-
riod, whether or not they are required to
file electronically. Affected organizations
required to file electronically may file
electronically prior to January 1, 2012 or
between March 1, 2012 and March 30,
2012. Affected organizations that are
not required to file electronically may
do the same or may file on paper by
March 30, 2012. This extension of time
to file is automatic; therefore, affected
organizations need not file Form 8868,
Application for Extension of Time To File
an Exempt Organization Return,if they
file their returns by March 30, 2012.
Because extensions of time to file, gen-
erally, may not exceed six months, the
extension of time to file to March 30, 2012
provided by this notice is not available for
affected organizations that have already
obtained two three-month extensions
of time to file (i.e., the full six-month
extension allowed by statute). However,
as discussed in more detail below, the IRS
will provide relief from any late filing
penalty to affected organizations that
were previously granted two three-month
extensions of time to file that expire during
the suspension period, provided their
returns are filed by March 30, 2012. In
addition, as indicated in more detail below,
this notice provides such organizations
normally required to file electronically
the option of filing on paper during the
suspension period.
Interaction between the March 30, 2012
Extension and Other Extensions
An affected organization that has not
previously received an extension and
wishes to extend its filing due date un-
til after March 30, 2012, may request an
automatic three-month extension of time
to file by properly completing and filing
Form 8868 by its original due date. For
example, an organization with an original
Form 990 due date of February 15, 2012
that properly completes and files Form
8868 by February 15, 2012 will receive
a three-month extension of time to file
that ends on May 15, 2012. In the case of
an organization that has already obtained
an automatic three-month extension that
ends during the suspension period, the IRS
will grant the organization an additional
3-month extension if the organization
properly completes and files Form 8868
by its extended due date. For example, a
February 15, 2012 extended due date will
be further extended to May 15, 2012 if
the organization properly completes and
filesForm8868byFebruary15,2012.
An affected organization that has already
received two three-month extensions, the
second of which ends during the suspen-
sion period, may not request a further
extension (but as discussed below, no
penalty for failure to file will apply if the
2012–3 I.R.B.290January 17, 2012

organization files its return by March 30,
2012).
Extension of Time to File Does Not
ExtendTimetoPayAnyTaxLiability
Organizations are reminded that an
extension of time to file, including the
automatic extension of time to file to
March 30, 2012 provided in this notice,
is not an extension of time to pay any tax
liabilities that may be due for the year.
Therefore, an organization that has a tax
liability for a return that has a due date that
falls within the suspension period must
make a timely payment of the amount due
either by making an estimated tax payment
or by filing its return on paper, if permitted
normally or under this notice as described
below, and remitting payment with its
return or by electronic funds transfer if
required.
Relief from Late Filing Penalty
An affected organization with a second
extended filing due date that falls during
the suspension period is not eligible for
an additional extension of time to file.
However, if such an organization files its
return by March 30, 2012, it will have
reasonable cause for its late filing and,
therefore, will not be subject to a late
filing penalty. Such an organization that
files by March 30, 2012 is not required
to file a Reasonable Cause Statement
in order to take advantage of this late
filing penalty relief. However, in order
to avoid receiving a system-generated
penalty notice for late filing, each affected
organization should attach a Reasonable
Cause Statement to its return. Appendix
A of this notice contains an example
of a Reasonable Cause Statement that
organizations can use. If an affected
organization erroneously receives a
system-generated penalty notice for late
filing from the IRS, the organization
should call the telephone number on the
penalty notice to request that the IRS abate
the penalty in accordance with Notice
2012–4.
Limited Option to File on Paper during
the Suspension Period
The automatic extension and automatic
penalty relief provisions of this notice are
designed to ensure that any affected or-
ganization whose filing is delayed by rea-
son of the suspension of the MeF system
will not suffer adverse consequences and
will be accorded the same results as if it
filed a return by the normal filing dead-
line. The IRS recognizes, however, that
some affected organizations generally re-
quired to file electronically that have al-
ready obtained two three-month filing ex-
tensions may be uncomfortable relying on
the late filing penalty relief provided in this
notice. In that circumstance, the affected
organization may file its return on paper.
Organizations that are normally required
to file electronically and choose to file on
paper pursuant to this notice may receive
a system-generated form asking for an ex-
planation of why they did not file electron-
ically. It will be sufficient to respond “Pa-
per Filing Pursuant to Notice 2012–4.”
Schedule H for Hospitals
Section 9007 of the Patient Protec-
tion and Affordable Care Act (Affordable
Care Act), Pub. L. No. 111–148, 124
Stat. 119 (March 23, 2010), included new
requirements for tax-exempt hospital or-
ganizations and their hospital facilities,
including information return reporting
requirements. To gather information on
hospital organizations’ compliance with
these requirements and on related policies
and practices, the IRS revised the Form
990, Schedule H for tax year 2010 to add a
new Part V.B. To give the hospital commu-
nity more time to familiarize itself with the
types of information the IRS is requesting,
the IRS made Part V.B optional for tax
year 2010.SeeAnnouncement 2011–37,
2011–27 I.R.B. 37. Beginning in tax year
2011, Part V.B is no longer optional, with
the exception of lines 1 through 7, regard-
ing community health needs assessments
(CHNAs), as the CHNA requirements of
the Affordable Care Act are only effective
for tax years beginning after March 23,
2012. Accordingly, hospital organizations
that are reqiired to file the 2011 Form
990 are required to complete all parts and
sections of the 2011 Schedule H, including
Part V.B, except lines 1 through 7 of Part
V.B.
The IRS has considered public input on
Part V.B, and has made revisions to Part
V.B for tax year 2011. The IRS antici-
pates making further revisions to Part V.B
for future years and welcomes further pub-
lic input. To be considered for the tax
year 2012 form revisions, input must be
received by January15, 2012. Input sub-
mitted after such date will be considered
for future years. Input can be submitted to
Form990Revision@irs.govor the follow-
ing address:
Internal Revenue Service
Attn: Stephen Clarke (Notice 2012–4)
SE:T:EO
1111 Constitution Avenue, N.W.
Washington, D.C. 20224
The principal author of this notice is
Stephen Clarke of the Tax Exempt and
Government Entities Division. For further
information regarding this notice, please
contact Mr. Clarke at (202) 283–9474 (not
a toll-free number).
APPENDIX A
Reasonable Cause Statement
This return is being filed between
March 1, 2012, and March 30, 2012, as
directed by the IRS in Notice 2012–4,
because electronic filing was not avail-
able January 1, 2012 through February 29,
2012. We request that penalties be waived
because it would be inequitable to impose
a penalty on us due to the unusual circum-
stances requiring us to delay the filing of
this return.
Safe Harbor Reporting Method
for Eligible REMICS Required
to Report on Schedule Q
Information with Respect to
REMIC Assets
Notice 2012–5
PURPOSE
This notice provides a safe harbor re-
porting method that aneligible real estate
mortgage investment conduit (REMIC)
may use to satisfy its reporting obliga-
tions under § 1.860F–4(e)(1)(ii) of the
Income Tax Regulations with respect to
information regarding REMIC assets that
the REMIC must report to residual interest
holders on a Schedule Q (Form 1066),
Quarterly Notice to Residual Interest
January 17, 20122912012–3 I.R.B.

Holder of REMIC Taxable Income or Net
Loss Allocation (Schedule Q).
THE HOME AFFORDABLE
REFINANCE PROGRAM (HARP)
In April 2009, the Federal Housing
Finance Agency (FHFA) and the United
States Department of the Treasury intro-
duced the Home Affordable Refinance
Program (HARP) as part of the United
States Government’s Making Home Af-
fordable Program. On October 24, 2011,
FHFA, with Federal National Mortgage
Association (Fannie Mae) and Federal
Home Loan Mortgage Corporation (Fred-
die Mac), announced an expansion of
HARP in an effort to serve additional el-
igible borrowers who can benefit from
refinancing their home mortgages. De-
tails of the expansion were announced on
November 15, 2011.
HARP serves borrowers who may not
otherwise qualify for refinancing, either
because the value of their homes has
declined or because they cannot obtain
mortgage insurance. The program is avail-
able to borrowers who owe more on their
mortgages than the value of their homes.
HARP provides these homeowners with
the ability to refinance their mortgages
into more affordable and sustainable mort-
gages.
LAW
REMICs are widely used securitization
vehicles for mortgages. REMICs are gov-
erned by sections 860A through 860G of
the Internal Revenue Code. For an en-
tity to qualify as a REMIC, all of the in-
terests in the entity must consist of one or
more classes of regular interests and a sin-
gle class of residual interests,seesection
860D(a), and those interests must be issued
on the startup day, within the meaning of
§ 1.860G–2(k).
Under section 860D(a)(4), an entity
qualifies as a REMIC only if, among other
things, as of the close of the third month
beginning after the startup day and at
all times thereafter, substantially all of
its assets consist of qualified mortgages
and permitted investments. In general,
the term “qualified mortgage” means an
obligation that is principally secured by
an interest in real property.Seesection
860G(a)(3)(A). That is, an obligation se-
cured by an “interest in real property” is
not a qualified mortgage unless the obli-
gation is “principally secured” by such an
interest.
An obligation is “principally secured” if
the fair market value of the interest in real
property securing the obligation equals at
least 80 percent of the adjusted issue price
of the obligation (the 80-percent test).See
§ 1.860G–2(a)(1). The regulations require
the 80-percent test to be satisfied either
at the time the obligation was originated
or at the time the sponsor contributes the
obligation to the REMIC. After the startup
day, the regulations generally do not re-
quire retesting of the value of the interest
in real property that secures the obligation.
The REMIC regulations cross-ref-
erence the real estate investment trust
(REIT) regulations to define the term
“interest in real property.” Specifically,
§ 1.860G–2(a)(4) provides that the def-
inition of “interests in real property”
in § 1.856–3(c) and the definition of
“real property” in § 1.856–3(d) apply
for purposes of section 860G(a)(3) and
§ 1.860G–2(a). In addition, a mortgage
pass-thru certificate that is guaranteed by
Fannie Mae or Freddie Mac is included
as an obligation secured by an interest
in real property for purposes of section
860G(a)(3)(A).See§ 1.860G–2(a)(5).
Section 1.860F–4(e) provides that,
at the close of each calendar quarter, a
REMIC must provide to each person who
held a residual interest in the REMIC dur-
ing that quarter notice on Schedule Q of
certain information, including information
with respect to REMIC assets. Under
§ 1.860F–4(e)(1)(ii)(A), a REMIC must
provide to each of its residual interest
holders the following information: (1) the
percentage of REMIC assets that are de-
scribed in section 7701(a)(19) (Category
1); and (2) the percentage of REMIC assets
that are real estate assets defined in section
856(c)(5)(B) (Category 2),
1
computed by
reference to the average adjusted basis (as
defined in section 1011) of the REMIC
assets during the calendar quarter.
2
If the
percentage of REMIC assets represented
by either Category 1 or Category 2 is at
least 95 percent, then the REMIC need
only specify on Schedule Q that the per-
centage for that category was at least 95
percent (the 95-percent asset-reporting
test).
Under § 1.860F–4(e)(1)(ii)(B), if,
for any calendar quarter after 1988, the
95-percent asset-reporting test is not met
with respect to assets in Category 2 (that
is, real estate assets as defined in section
856(c)(5)(B)), then for that calendar quar-
ter, the REMIC must provide the following
additional information to any REIT that
holds a residual interest:
(1) The percentage of REMIC as-
sets described in section 856(c)(4)(A),
computed by reference to the average
adjusted basis of the REMIC assets dur-
ing the calendar quarter (as described in
§ 1.860F–4(e)(1)(iii)),
(2) The percentage of REMIC gross
income (other than gross income from
prohibited transactions defined in sec-
tion 860F(a)(2)) described in section
856(c)(3)(A) through (E), computed as of
the close of the calendar quarter, and
(3) The percentage of REMIC gross
income (other than gross income from
prohibited transactions defined in section
860F(a)(2)) that is described in section
856(c)(3)(F) (which refers to income or
gain from foreclosure property), computed
as of the close of the calendar quarter. For
this purpose, the term “foreclosure prop-
erty” has the meaning specified in section
860G(a)(8) (which governs REMICs),
rather than the closely related definition of
“foreclosure property” in section 856(e)
(which otherwise would determine the
income or gain that is described in section
856(c)(3)(F)).
Section 1.860G–2(a)(1) generally treats
a mortgage loan as an obligation “princi-
pallysecuredbyaninterestinrealprop-
erty” for purposes of section 860G(a)(3)
if the loan is secured by an interest in
real property that is worth at least 80 per-
cent of the outstanding stated principal of
the loan (in other words, the loan-to-value
ratio of the loan—commonly referred to
1
The regulation refers to former section 856(c)(6)(B). Section 1255 of theTaxpayer Relief Act of 1997 (P.L. 105–34) redesignated former section 856(c)(6)(B) as current section 856(c)(5)(B).
2
Section 1.860F–4(e)(1)(ii)(A) also requires a REMIC to provide information with respect to the percentage of REMIC assets that are qualifying real property loans under section 593. Section
1616(a) of the Small Business Job Protection Act of 1996 (P. L. 104–188), however, repealed the section 593 reserve method of accounting for bad debts of thrift institutions for tax years
beginning after December 31, 1995. Accordingly,whether assets are “qualifying real property loansunder section 593” is no longer relevant, and thereporting of this information to residual
interest holders is unnecessary.
2012–3 I.R.B.292January 17, 2012

as “LTV”—is not greater than 125 per-
cent).
3
If, however, a REMIC holds one or
more qualified mortgages that are less than
95-percent secured by an interest in real
property, the REMIC may fail the 95-per-
cent asset-reporting test and may be re-
quired to report additional information to
residual interest holders with respect to the
REMIC assets.
SAFE HARBOR REPORTING
METHOD
As a safe harbor for purposes
of a REMIC’s reporting obligation
to residual interest holders under
§ 1.860F–4(e)(1)(ii), if a REMIC is an
“eligible REMIC” as defined below and if
the percentage of its assets represented by
either Category 1 or Category 2 is less than
95 percent but at least 80 percent, then the
REMIC need only specify on Schedule Q
that the percentage for that category was
at least 80 percent.
To qualify as an “eligible REMIC” un-
der this notice—
1. The REMIC must have a guarantee
from Fannie Mae or Freddie Mac that
will supplement amounts received by
the REMIC as required to permit the
payment of principal and interest, as
applicable, on both the regular inter-
ests and residual interests issued by
the REMIC; and
2. All of the qualified mortgages (includ-
ing mortgage pass-thru certificates)
that are held by the REMIC must be
secured by interests in single-family
(one-to-four unit) dwellings.
See also Rev. Proc. 2012–14, this bul-
letin, for guidance to REITs that hold a
regular or residual interest in an eligible
REMIC.
EFFECTIVE DATE
The safe harbor reporting method de-
scribed in this notice applies to reporting
for calendar quarters ending on or after De-
cember 31, 2011.
DRAFTING INFORMATION
The principal author of this notice is
Diana Imholtz of the Office of Associate
Chief Counsel (Financial Institutions and
Products). For furtherinformation regard-
ing this notice, contact Ms. Imholtz at
202–622–3920 (not a toll-free call).
(Also 26 CFR 1.414(l)–1, 1.933–1, 1.501(a)–1, and
301.7805–1.)
Qualified Pension,
Profit-Sharing, and Stock
Bonus Plans; Exemption from
Tax on Corporations, Certain
Trusts, Etc.
Notice 2012–6
I. PURPOSE
This notice extends and expands the
transition relief provided under Rev. Rul.
2011–1, 2011–2 I.R.B. 251, and Rev.
Rul. 2008–40, 2008–2 C.B. 166, for cer-
tain group trusts, certain retirement trusts
that qualify under the Puerto Rico Inter-
nal Revenue Code (Puerto Rico Code)
and that participatein group trusts, and
certain qualified retirement plans that ben-
efit Puerto Rico residents. This notice
also provides additional time for govern-
mental retiree benefit plans described in
§ 401(a)(24) of the Internal Revenue Code
(Code) (§ 401(a)(24) plans) to be amended
to satisfy the applicable requirements of
Rev. Rul. 2011–1.
II. BACKGROUND
Rev. Rul. 81–100, 1981–1 C.B. 326,
provides that qualified retirement plans
and individual retirement accounts are per-
mitted to pool their assets for investment
purposes in a group trust (“81–100 group
trusts”) if certain specified requirements
are satisfied. Rev. Rul. 81–100 was clari-
fied and modified by Rev. Rul. 2004–67,
2004–2 C.B. 28. Rev. Rul. 2011–1 revises
and restates the generally applicable rules
for group trusts described in Rev. Rul.
81–100, 1981–1 C.B. 326, as clarified and
modified by Rev. Rul. 2004–67. Rev.
Rul. 2011–1 permits the participation in
81–100 group trusts of certain retiree ben-
efit plans, such as governmental retiree
benefit plans under § 401(a)(24), in addi-
tion to § 401(a) qualified retirement plans,
if certain requirements are met.
Section 1022(i)(1) of the Employee
Retirement Income Security Act of 1974,
Pub. L. 93–406 (ERISA) provides a tax
exemption under § 501(a) of the Code for
certain plans that satisfy the qualification
requirements under the Puerto Rico Code
(“section 1022(i)(1) plans”).
Rev. Rul. 2008–40 holds that a transfer
of amounts from a trust under a plan qual-
ified under § 401(a) to a nonqualified for-
eign trust is treated asa distribution from
the transferor plan. Rev. Rul. 2008–40
holds further that a transfer of assets and
liabilities from a qualified plan to a plan
that satisfies the plan qualification require-
ments under section 1165 of the Puerto
Rico Code is also treated as a distribution
from the transferor plan, even if the plan
is a section 1022(i)(1) plan. Rev. Rul.
2008–40 provided transition relief for a
transfer from a qualified plan to a section
1022(i)(1) plan that occurred before Jan-
uary 1, 2011.
Rev. Rul. 2011–1 provides tempo-
rary relief relating to investments of the
assets of certain section 1022(i)(1) plans
in 81–100 group trusts, and modifies the
transition relief provided in Rev. Rul.
2008–40 relating to transfers from qual-
ified plans to section 1022(i)(1) plans.
Specifically, under the heading “Plans De-
scribed in Section 1022(i)(1) of ERISA,”
Rev. Rul. 2011–1 provides that:
The Service anticipates issuing guid-
ance as to whether a plan described in
section 1022(i)(1) of ERISA may par-
ticipate in an 81–100 group trust. Until
such guidance is issued, the Service
will not treat a group trust as failing
to satisfy the requirements of this rev-
enue ruling merely because the group
trust includes the assets of a section
1022(i)(1) plan as long as the section
1022(i)(1) plan (1) was participating in
the group trust as of January 10, 2011,
or (2) holds assets that had been held
by a qualified plan immediately prior
to the transfer of those assets to the
section 1022(i)(1) plan pursuant to the
transition relief in Rev. Rul. 2008–40,
as modified by this revenue ruling. In
addition, Rev. Rul. 2008–40 is hereby
3
In general, the adjusted issue price of a home mortgage loan is equal to or slightly less than the outstanding stated principal of the loan. Thus, although LTV is based on stated principal
rather than on adjusted issue price, if LTV is not greater than 125 percent, then the criterion for “principally secured” will generally be satisfied (that is, the value of the real property collateral
will be at least 80 percent of the adjusted issue price).
January 17, 20122932012–3 I.R.B.

modified to extend the transition relief
for transfers from a qualified plan to a
section 1022(i)(1) transferee plan for
an additional year. Thus, “January 1,
2012” is substituted for “January 1,
2011” each place it appears in the
Transition Relief section of Rev. Rul.
2008–40.
When Rev Rul. 2011–1 and 2008–40
were issued, the qualification provisions
for retirement plans were contained in
section 1165 of the Puerto Rico Code.
On January 31, 2011, the retirement plan
qualification provisions of the Puerto Rico
Code were extensively amended.
1
These
provisions, which now appear at section
1081.01 of the Puerto Rico Code, apply
to plans qualified under both U.S. and
Puerto Rico law (sometimes referred to
as “dual-qualified plans”), as well as to
section 1022(i)(1) plans.
III. EXTENSION AND EXPANSION
OF RELIEF
The Service anticipates issuing guid-
ance responding to comments received in
connection with Rev. Rul. 2011–1. Ac-
cordingly, the following relief is provided.
A. ERISA Section 1022(i)(1) Plans
1. Expansion of relief under Rev. Rul.
2011–1 relating to 81–100 group trust
status of certain trusts containing
section 1022(i)(1) plan investments
ThereliefprovidedinRev. Rul.
2011–1 under the heading “Plans De-
scribed in Section 1022(i)(1) of ERISA”
continues to apply. In addition, that relief
is expanded to cover an 81–100 group
trust with respect to an investment by a
section 1022(i)(1) planthat is the recipient
of a transfer of assets from a qualified
retirement plan pursuant to the transition
relief under Rev. Rul. 2008–40, as modi-
fied by Rev. Rul. 2011–1 and this notice,
if assets of the transferor plan were held
in the 81–100 group trust on January 10,
2011.
2. Extension of transition relief under
Rev. Rul. 2008–40 relating to tax
consequences of certain transfers to
section 1022(i)(1) plans
(i) Extension of transfer deadline until
further guidance for certain qualified
plans invested in group trusts
The relief provided in paragraphs 2,
3, and 4(b) under the Transition Relief
heading in Rev. Rul. 2008–40 is ex-
tended for transfers to a section 1022(i)(1)
transferee plan from a qualified retirement
plan that participated in an 81–100 group
trust on January 10, 2011, until a deadline
to be set forth in future published guid-
ance. It is expected that, when further
guidance relating to participation of sec-
tion 1022(i)(1) plans in group trusts is pub-
lished, that guidance will set a future dead-
line for transfers covered by this extension.
(ii) One-year general extension of
transfer deadline
The Service recognizes that a sponsor
of a qualified retirement plan that benefits
Puerto Rico residents may need additional
time to evaluate whether to spin off the
portion of the plan benefiting Puerto Rico
residents to a section 1022(i)(1) plan in or-
der to consider the effect of the changes to
the Puerto Rico Code enacted earlier this
year. Accordingly, Rev. Rul. 2008–40
is hereby further modified to extend the
relief provided in paragraphs 2, 3, and 4(b)
under the Transition Relief heading in Rev.
Rul. 2008–40 for transfers to a section
1022(i)(1) transferee plan from any qual-
ified retirement plan until December 31,
2012, regardless of whether the qualified
retirement plan participates in a group
trust.
B. Governmental Retiree Benefit Plans
In order to ensure that the governing
documents of § 401(a)(24) plans may be
timely amended to satisfy the require-
ments of Rev. Rul. 2011–1, the ruling
is modified to provide that, in the case
of a § 401(a)(24) plan for which the au-
thority to amend the plan is held by a
legislative body that meets in legislative
session, the plan will not fail to satisfy the
requirements of Rev. Rul. 2011–1 if the
governing document is modified to satisfy
the applicable requirements of Rev. Rul.
2011–1 by the earlier of:
1. The close of the first regular legisla-
tive session of the legislative body
with the authority to amend the plan
that begins on or after January 1,
2012; or
2. January 1, 2015.
IV. COMMENTS REQUESTED
In general, if an entity that is not a group
trust retiree benefit plan as defined in the
holding of Rev. Rul. 2011–1 (an “ineli-
gible entity”) participates in a group trust,
the consequences described in the hold-
ings of Rev. Rul. 2011–1, including the
tax status of the group trust being derived
from the tax status of the participating enti-
ties to the extent of their equitable interest
in the group trust, would not apply to the
group trust or to any of the entities that are
invested in the trust. Comments are re-
quested on whether the rule stating that the
tax status of the group trust is derived from
the tax status of the participating entities
to the extent of their equitable interest in
the group trust should be extended to cases
where the equitable interest in the group
trust is held by an ineligible entity that is
an employee benefit plan if (a) the plan is
tax exempt under § 501 or a similar rule
and (b) in all other respects the require-
ments in paragraphs (1) through (8) of
the holding of Rev. Rul. 2011–1 (includ-
ing the exclusive benefit requirement in
(5) and the separateaccount requirement
in (6)) are satisfied. Comments should
be submitted by April 16, 2012 (Notice
2012–6), Room 5203, Internal Revenue
Service, POB 7604 Ben Franklin Station,
Washington, D.C. 20044. Comments may
be hand delivered Monday through Friday
between the hours of 8 a.m. and 4 p.m. to
CC:PA:LPD:PR (Notice 2012–6),
Courier’s Desk, Internal Revenue
Service, 1111 Constitution Ave., N.W.,
Washington D.C. Alternatively, comments
may be submitted via the Internet at
Notice.comments@irscounsel.treas.gov.
Please include “Notice 2012–6” in
the subject line of any electronic
communication. All materials submitted
will be available for public inspection and
copying.
1
See Código de Rentas Internas para un Nuevo Puerto Rico de la Ley Núm. 1 de 31 de enero de 2011.
2012–3 I.R.B.294January 17, 2012

V. EFFECT ON OTHER
DOCUMENTS
Rev. Ruls. 2011–1 and 2008–40 are
modified.
DRAFTING INFORMATION
The principal authors of this notice
are Diane Bloom and Robert Walsh of
the Employee Plans, Tax Exempt and
Government Entities Division. For fur-
ther information regarding this notice,
please call the Employee Plans’ tax-
payer assistance telephone service at
1–877–829–5500 (a toll-free number) be-
tween the hours of 8:00 a.m. and 4:30 p.m.
Eastern Time, Monday through Friday, or
atRetirementPlanQuestions@irs.gov.
26 CFR 1.61–21: Taxation of fringe benefits.
(Also: Internal Revenue Code §§ 61, 280F.)
Rev. Proc. 2012–13
SECTION 1. PURPOSE
.01 This revenue procedure provides:
(1) the maximum value of employer-pro-
vided vehicles first made available to em-
ployees for personal use in calendar year
2012 for which the vehicle cents-per-mile
valuation rule provided under section
1.61–21(e) of the Income Tax Regula-
tions may be applicable is $15,900 for a
passenger automobile and $16,700 for a
truck or van; (2) the maximum value of
employer-provided vehicles first made
available to employees for personal use in
calendar year 2012 for which the fleet-av-
erage valuation rule provided under sec-
tion 1.61–21(d) of the regulations may
be applicable is $21,100 for a passenger
automobile and $21,900 for a truck or van.
SECTION 2. BACKGROUND
.01 If an employer provides an em-
ployee with a vehicle that is available
to the employee for personal use, the
value of the personal use must generally
be included in the employee’s income
and wages. Internal Revenue Code § 61;
Treas. Reg. § 1.61–21.
.02 For employer-provided passen-
ger automobiles (including trucks and
vans) made available to employees for
personal use that meet the requirements
of section 1.61–21(e)(1) of the regula-
tions, generally the value of the personal
use may be determined under the vehicle
cents-per-mile valuation rule of section
1.61–21(e). However, regulations section
1.61–21(e)(1)(iii)(A) provides that for a
passenger automobile first made avail-
able after 1988 to any employee of the
employer for personal use, the value of
the personal use may not be determined
under the vehicle cents-per-mile valuation
rule for a calendar year if the fair market
value of the passenger automobile (de-
termined pursuant to regulations section
1.61–21(d)(5)(i) through (iv)) on the first
date the passenger automobile is made
available to the employee exceeds a spec-
ified dollar limit.
.03 For employer-provided vehicles
available to employees for personal use for
an entire year, generally the value of the
personal use may be determined under the
automobile lease valuation rule of section
1.61–21(d) of the regulations. Under this
valuation rule, the value of the personal
use is the Annual Lease Value. Provided
the requirements of regulation section
1.61–21(d)(5)(v) are met, an employer
with a fleet of 20 or more automobiles
may use a fleet-average value for purposes
of calculating the Annual Lease Values of
the automobiles in the employer’s fleet.
The fleet-average value is the average
of the fair market values of all the auto-
mobiles in the fleet. However, section
1.61–21(d)(5)(v)(D) of the regulations
provides that for an automobile first made
available after 1988 to an employee of the
employer for personal use, the value of the
personal use may not be determined under
the fleet-average valuation rule for a cal-
endar year if the fair market value of the
automobile (determined pursuant to reg-
ulations section 1.61–21(d)(5)(i) through
(v)) on the first date the passenger auto-
mobile is made available to the employee
exceeds a specified dollar limit.
.04 The maximum passenger automo-
bile values for applying the vehicle cents-
per-mile and the fleet-average value rules
reflect the automobile price inflation ad-
justment of Code section 280F(d)(7). The
method of calculating this price inflation
amount for automobiles other than trucks
and vans uses the “new car” component of
the CPI “automobile component”. When
calculating this price inflation adjustment
for trucks and vans, the “new trucks” com-
ponent of the CPI is used. This results
in somewhat higher maximum values for
trucks and vans. This change reflects the
higher rate of price inflation that trucks and
vans have been subject to since 1988, and
is consistent with the change announced in
Rev. Proc. 2003–75, 2003–2 C.B. 1018,
for purposes of calculating depreciation
deductions.See alsoRev. Proc. 2011–21,
2011–12 I.R.B. 560. For purposes of this
revenue procedure, the term “trucks and
vans” refers to passenger automobiles that
are built on a truck chassis, including mini-
vans and sport utility vehicles (SUVs) that
are built on a truck chassis.
SECTION 3. PROCEDURE
.01 Maximum Automobile Value for
Using the Cents-per-mile Valuation Rule.
An employer providing a passenger auto-
mobile for the first time in calendar year
2012 for the personal use of any employee
may determine the value of the personal
use by using the vehicle cents-per-mile
valuation rule in section 1.61–21(e) of the
regulations if its fair market value on the
date it is first made available does not
exceed $15,900 for a passenger automo-
bile other than a tuck or van, or $16,700
foratruckorvan. Ifthefairmarket
value of the passenger automobile exceeds
this amount, the employer may determine
the value of the personal use under the
general valuation rules of regulation sec-
tion 1.61–21(b) or under the special valua-
tion rules of section 1.61–21(d) (Automo-
bile lease valuation) or section 1.61–21(f)
(Commuting valuation) if the applicable
requirements are met.SeeRev. Proc.
2010–10, 2010–3 I.R.B. 300, for guidance
on determining the maximum value of pas-
senger automobiles first made available
during calendar year2010, and Rev. Proc.
2011–11, 2011–4 I.R.B. 329, for guidance
on determining the maximum value of pas-
senger automobiles first made available
during calendar year 2011.
.02 Maximum Automobile Value for
Using the Fleet-Average Valuation Rule.
An employer with a fleet of 20 or more
automobiles providing an automobile for
the first time in calendar year 2012 for
the personal use of any employee for an
entire year may determine the value of
the personal use by using the fleet-aver-
age valuation rule in regulations section
January 17, 20122952012–3 I.R.B.

1.61–21(d)(5)(v) to calculate the Annual
Lease Values of the automobiles in the
fleet. The fleet-average valuation rule may
not be used to determine the Annual Lease
Value of any automobile if its fair market
value on the date it is first made available
exceeds $21,100 for a passenger automo-
bile other than a truck or van, or $21,900
foratruckorvan. Ifallotherappli-
cable requirements are met, an employer
with a fleet of 20 or more vehicles consist-
ing of passenger automobiles other than
trucks or vans as well as trucks and vans
may use the fleet-average valuation rule
as long as none of the vehicles exceed
their respective maximum allowable val-
ues. If the fair market value of any passen-
ger automobile in the fleet exceeds these
amounts, the employer may determine the
value of the personal use under regulations
section 1.61–21(f) (Commuting valuation
rule) or the general valuation rules of sec-
tion 1.61–21(b) or may determine the An-
nual Lease Value of such automobile sepa-
rately under the automobile lease valuation
rule of section 1.61–21(d)(2) if the applica-
ble requirements are met.
SECTION 4. EFFECTIVE DATE
This revenue procedure applies to em-
ployer-provided passenger automobiles
first made available to employees for per-
sonal use in calendar year 2012.
SECTION 5. DRAFTING
INFORMATION
The principal author of this revenue
procedure is Don M. Parkinson of the
Office of the Division Counsel/Associate
Chief Counsel (Tax Exempt & Govern-
ment Entities). For further information
regarding the maximum automobile val-
ues for applying the valuation rules of
regulations section 1.61–21(e)(1)(iii)(A)
(the vehicle cents-per-mile valuation
rule), and section 1.61–21(d)(5)(v)(D)
(the fleet average valuation rule), contact
Don M. Parkinson at (202) 622–6040 (not
a toll-free call).
26 CFR 601.105: Examination of returns and claims
for refund, credit or abatement; determination of
correct tax liability.
(Also Part 1, §§ 856; 1.856–3, 1.856–5, and
1.860F–4.)
Rev. Proc. 2012–14
SECTION 1. PURPOSE
This revenue procedure sets forth a safe
harbor that provides the extent to which
an investment by a real estate investment
trust (REIT) in a regular or a residual inter-
est in certain real estate mortgage invest-
ment conduits (REMICs) may be treated
as a real estate asset for purposes of sec-
tions 856(c)(4)(A) and 856(c)(5)(B) of the
Internal Revenue Code and the extent to
which interest from that investment may
be treated as derived from interest on an
obligation secured by a mortgage on real
property or on an interest in real property
for purposes of section 856(c)(3)(B).
SECTION 2. BACKGROUND—HARP
.01 In April 2009, the Federal Housing
Finance Agency (FHFA) and the United
States Department of the Treasury intro-
duced the Home Affordable Refinancing
Program(HARP)aspartoftheUnited
States Government’s Making Home Af-
fordable Program. On October 24, 2011,
FHFA, with Federal National Mortgage
Association (Fannie Mae) and Federal
Home Loan Mortgage Corporation (Fred-
die Mac), announced an expansion of
HARP in an effort to serve additional el-
igible borrowers who can benefit from
refinancing their home mortgages. De-
tails of the expansion were announced on
November 15, 2011.
HARP serves borrowers who may not
otherwise qualify for refinancing, either
because the value of their homes has
declined or because they cannot obtain
mortgage insurance. The program is avail-
able to borrowers who owe more on their
mortgages than the value of their homes.
HARP provides these homeowners with
the ability to refinance their mortgages
into more affordable and sustainable mort-
gages.
.02 It is expected that many mortgages
refinanced under HARP will be held by
REMICs.
SECTION 3. BACKGROUND-REMICS
.01 REMICs are widely used securitiza-
tion vehicles for mortgages. REMICs are
governed by sections 860A through 860G.
.02 For an entity to qualify as a REMIC,
all of the interests in the entity must consist
of one or more classes of regular interests
and a single class of residual interests,see
section 860D(a), and those interests must
be issued on the startup day, within the
meaning of § 1.860G–2(k) of the Income
Tax Regulations.
.03Inadditiontobeingissuedonthe
startup day with fixed terms, a regular
interest must (1) unconditionally entitle
the holder to receive a specified principal
amount (or other similar amount), and (2)
provide that interest payments, if any, at or
before maturity are based on a fixed rate
(or to the extent provided in regulations,
at a variable rate).Seesection 860G(a)(1).
.04 Under section 860D(a)(4), an entity
qualifies as a REMIC only if, among other
things, as of the close of the third month
beginning after the startup day and at all
times thereafter, substantially all of its
assets consist of qualified mortgages and
permitted investments. This asset test is
satisfied if the entity owns no more than
ade minimisamount of other assets.See
§ 1.860D–1(b)(3)(i). As a safe harbor,
the amount of assets other than qualified
mortgages and permitted investments is
de minimisif the aggregate of the ad-
justed bases of those assets is less than one
percent of the aggregate of the adjusted
bases of all of the entity’s assets. Section
1.860D–1(b)(3)(ii).
.05 A mortgage loan is a qualified
mortgage only if it is principally secured
by an interest in real property. Section
860G(a)(3)(A).
.06 In general, for purposes of section
860G(a)(3)(A), an obligation is principally
secured by an interest in real property only
if it satisfies the “80-percent test” set forth
in § 1.860G–2(a)(1)(i).
.07 Under the 80-percent test, an obli-
gation is principally secured by an inter-
est in real property if the fair market value
of the interest in real property securing the
obligation—
(1) Was at least equal to 80 percent of
the adjusted issue price of the obligation at
the time the obligation was originated; or
(2) Is at least equal to 80 percent of the
adjusted issue price of the obligation at the
2012–3 I.R.B.296January 17, 2012

time the sponsor contributes the obligation
to the REMIC.
.08 With limited exceptions, a mort-
gage loan is not a qualified mortgage
unless it is transferred to the REMIC on
the startup day in exchange for regular
or residual interests in the REMIC.See
section 860G(a)(3)(A)(i).
.09 The legislative history of the
REMIC provisions indicates that Congress
intended the provisions to apply only to
an entity that holds a substantially fixed
pool of real estate mortgages and related
assets and that “has no powers to vary
the composition of its mortgage assets.”
S. Rep. No. 99–313, 99th Cong., 2d Sess.
791–92, 1986–3 (Vol. 3) C.B. 791–92.
SECTION 4. BACKGROUND—REMIC
REPORTING
.01 Section 1.860F–4(e)(1)(ii)(A) pro-
vides that for calendar quarters after 1988,
a REMIC must provide to each of its resid-
ual interest holders information regarding
(among other items) the percentage of
REMIC assets that are real estate assets
defined in section 856(c)(5)(B),
1
com-
puted by reference to the average adjusted
basis (as defined in section 1011) of the
REMIC assets during the calendar quarter
(as described in § 1.860F–4(e)(1)(iii)). If
the percentage of REMIC assets repre-
sented by real estate assets is at least 95
percent, then the REMIC need only spec-
ify that the percentage of real estate assets
was at least 95 percent.
.02 Section 1.860F–4(e)(1)(ii)(B) pro-
vides that if, for any calendar quarter after
1988, less than 95 percent of the assets of
the REMIC are real estate assets defined in
section 856(c)(5)(B),then, for that calen-
dar quarter, the REMIC must also provide
to any REIT that holds a residual interest
the following information—
(1) The percentage of REMIC as-
sets described in section 856(c)(4)(A),
computed by reference to the average
adjusted basis of the REMIC assets dur-
ing the calendar quarter (as described in
§ 1.860F–4(e)(1)(iii)),
(2) The percentage of REMIC gross
income (other than gross income from
prohibited transactions defined in sec-
tion 860F(a)(2)) described in section
856(c)(3)(A) through (E), computed as of
the close of the calendar quarter, and
(3) The percentage of REMIC gross
income (other than gross income from
prohibited transactions defined in sec-
tion 860F(a)(2)) described in section
856(c)(3)(F) (which refers to income or
gain from foreclosure property), computed
as of the close of the calendar quarter. For
this purpose, the term “foreclosure prop-
erty” has the meaning specified in section
860G(a)(8) (which governs REMICs),
rather than the closely related definition of
“foreclosure property” in section 856(e)
(which otherwise would determine the
income or gain that is described in section
856(c)(3)(F)).
.03 Notice 2012–5, this bulletin,
provides that for purposes of an el-
igible REMIC’s reporting obliga-
tion to residual interest holders under
§ 1.860F–4(e)(1)(ii), if the percentage of
REMIC assets represented by real estate
assets is less than 95 percent but at least
80 percent, then the REMIC need only
specify on Schedule Q (Form 1066),Quar-
terly Notice to Residual Interest Holder
of REMIC Taxable Income or Net Loss
Allocation, that the percentage for that
category was at least 80 percent.
SECTION 5. BACKGROUND—REITS
.01 Many REITs invest in real estate
loans that are secured by real property.
REITs may also invest in REMIC reg-
ular or residual interests (see section
856(c)(5)(E)).
.02 Section 856(a) provides that an en-
tity shall not be considered a REIT for any
taxable year unless certain requirements
are satisfied. Under section 856(c)(4)(A),
at the close of each quarter of its taxable
year, at least 75 percent of the value of a
REIT’s total assets must be represented by
real estate assets, cash and cash items (in-
cluding receivables), and Government se-
curities.
.03 Section 856(c)(5)(B) provides that
the term “real estate assets” means real
property (including interests in real prop-
erty and interests in mortgages on real
property) and shares (or transferable cer-
tificates of beneficial interest) in other
REITs that meet the requirements of sec-
tions 856 through 859. Section 1.856–3(d)
provides that the term “real property”
means land or improvements thereon, such
as buildings and that the term “real prop-
erty” includes interests in real property.
Section 1.856–3(d) further provides that
local law definitions are not controlling for
purposes of determining the meaning of
the term “real property” as used in section
856 and the regulations thereunder.
.04 Section 856(c)(3)(B) provides that
at least 75 percent of a REIT’s gross in-
come must be derived from certain items,
including interest on obligations secured
by mortgages on real property or on inter-
ests in real property.
.05 Section 1.856–5(c)(1) provides that
if a mortgage coversboth real property and
other property, an apportionment of the in-
terest income must be made for purposes
of the 75-percent requirement of section
856(c)(3). Section 1.856–5(c)(1)(i) pro-
vides that if the loan value of the real prop-
erty is equal to or exceeds the amount of
the loan, the entire amount of interest in-
come shall be apportioned to the real prop-
erty. Section 1.856–5(c)(2) provides that
the loan value of the real property is the fair
market value of the property, determined
on the date the commitment by the trust to
purchase the loan or to make the loan be-
comes binding on the trust.
.06 Section 856(c)(5)(E) provides that
for purposes of Part II of subchapter M,
a regular or residual interest in a REMIC
shall be treated as a real estate asset, and
any amount includible in gross income
with respect to such an interest shall be
treated as interest on an obligation secured
by a mortgage on real property, except
that a REIT shall be treated as holding and
receiving directly itsproportionate share
of the assets and income of a REMIC if
less than 95 percent of the assets of such
REMIC are real estate assets (determined
as if the REIT held such assets). For pur-
poses of determining whether any interest
in a REMIC qualifiesunder the preceding
sentence, any interest held by such REMIC
in another REMIC shall be treated as a
real estate asset under principles similar to
the principles of the preceding sentence,
except that, if such REMICs are part of
a tiered structure, they shall be treated
as one REMIC for purposes of section
856(c)(5)(E).
1
Both §§ 1.860F–4(e)(1)(ii)(A) and § 1.860F–4(e)(1)(ii)(B) refer to former section 856(c)(6)(B), and § 1.860F–4(e)(1)(ii)(B)(1) refers to formersection 856(c)(5)(A). Section 1255 of the
Taxpayer Relief Act of 1997 (P.L. 105–34) redesignated former sections 856(c)(6)(B) and 856(c)(5)(A) as current sections 856(c)(5)(B) and 856(c)(4)(A), respectively.
January 17, 20122972012–3 I.R.B.

.07 The REMIC provisions do not
require REMICs to provide holders of
regular interests with information regard-
ing the percentage of REMIC assets that
are real estate assets for purposes of Part
II of subchapter M. Furthermore, if the
percentage of an eligible REMIC’s assets
that are real estate assets is less than 95
percent but at least 80 percent, then the
REMIC need only inform a REIT holding
a residual interest in that REMIC that the
percentage of assets described in section
856(c)(5)(B) was at least 80 percent. See
Notice 2012–5, this bulletin.
.08 To qualify as an “eligible REMIC”
under Notice 2012–5, the REMIC must
have a guarantee from Fannie Mae or Fred-
die Mac that will supplement amounts re-
ceivedbytheREMICasrequiredtoper-
mit the payment of principal and interest,
as applicable, on both the regular inter-
ests and residual interests issued by the
REMIC; and all of the qualified mortgages
(including mortgage pass-thru certificates)
that are held by the REMIC must be se-
cured by interests in single-family (one-to-
four unit) dwellings.
.09 Although eligible REMICs are not
required to provide more than limited in-
formation to REITs holding residual inter-
ests in those REMICs regarding the per-
centage of the REMICs’ assets described
in section 856(c)(5)(B), it is important for
those REITs to know—
(1) The extent to which both regular
and residual interests may be treated as
real estate assets for purposes of sections
856(c)(4)(A) and 856(c)(5)(B); and
(2) The extent to which gross in-
come with respect to those investments
may be treated for purposes of section
856(c)(3)(B) as derived from interest on
obligations secured by a mortgage on real
property or on an interest in real property.
SECTION 6. SCOPE
.01 Section 7 of this revenue procedure
applies to a regular interest that is held by
a REIT in an eligible REMIC as defined in
Notice 2012–5.
.02 Section 7 of this revenue procedure
applies to a residual interest that is held by
a REIT in an eligible REMIC as defined in
Notice 2012–5, if, inaccordance with No-
tice 2012–5, the REMIC informs the REIT
holding the residual interest in that REMIC
that the percentage of the REMIC’s assets
described in section 856(c)(5)(B) was at
least 80 percent.
SECTION 7. APPLICATION
IfaREITholdsaregularoraresidual
interest in an eligible REMIC that meets
the requirements of either section 6.01 or
section 6.02 of this revenue procedure,
then—
.01 The REIT may treat 80 percent of
the value of the regular or residual inter-
est as a real estate asset. If the REIT has
information establishing that, as a result
of holding the interest, its proportion-
ate share of the eligible REMIC’s assets
under section 856(c)(5)(E) produces a
higher percentage for purposes of section
856(c)(4)(A), then the REIT may use that
higher percentage.
.02 Any amount includible by the REIT
in gross income with respect to the reg-
ular or residual interest may be treated
as 80 percent derived from interest on an
obligation secured by a mortgage on real
property within the meaning of section
856(c)(3)(B). If the REIT has information
establishing that, as a result of holding
the interest, its proportionate share of the
eligible REMIC’s income under section
856(c)(5)(E) produces a higher percentage
for purposes of section 856(c)(3), then the
REIT may use that higher percentage.
SECTION 8. EFFECTIVE DATE
This revenue procedure is effective for
regular or residual interests in an eligi-
ble REMIC that has a startup date after
November 30, 2011.
DRAFTING INFORMATION
The principal author of this revenue
procedure is David B. Silber of the Office
of Associate Chief Counsel (Financial
Institutions and Products). For further
information, contact Mr. Silber at (202)
622–3930 (not a toll-free call).
2012–3 I.R.B.298January 17, 2012

Definition of Terms
Revenue rulings and revenue procedures
(hereinafter referred to as “rulings”) that
have an effect on previous rulings use the
following defined terms to describe the ef-
fect:
Amplifieddescribes a situation where
no change is being made in a prior pub-
lished position, but the prior position is be-
ingextendedtoapplytoavariationofthe
fact situation set forth therein. Thus, if
an earlier ruling held that a principle ap-
plied to A, and the new ruling holds that the
same principle also applies to B, the earlier
ruling is amplified. (Compare withmodi-
fied,below).
Clarifiedis used in those instances
where the language in a prior ruling is be-
ing made clear because the language has
caused, or may cause, some confusion.
It is not used where a position in a prior
ruling is being changed.
Distinguisheddescribes a situation
where a ruling mentions a previously pub-
lished ruling and points out an essential
difference between them.
Modifiedis used where the substance
of a previously published position is being
changed. Thus, if a prior ruling held that a
principle applied to A but not to B, and the
new ruling holds that it applies to both A
and B, the prior ruling is modified because
it corrects a published position. (Compare
withamplifiedandclarified, above).
Obsoleteddescribes a previously pub-
lished ruling that is not considered deter-
minative with respect to future transac-
tions. This term is most commonly used in
a ruling that lists previously published rul-
ings that are obsoleted because of changes
in laws or regulations. A ruling may also
be obsoleted because the substance has
been included in regulations subsequently
adopted.
Revokeddescribes situations where the
position in the previously published ruling
is not correct and the correct position is
beingstatedinanewruling.
Supersededdescribes a situation where
the new ruling does nothing more than re-
state the substance and situation of a previ-
ously published ruling (or rulings). Thus,
the term is used to republish under the
1986 Code and regulations the same po-
sition published under the 1939 Code and
regulations. The term is also used when
it is desired to republish in a single rul-
ing a series of situations, names, etc., that
were previously published over a period of
time in separate rulings. If the new rul-
ing does more than restate the substance
of a prior ruling, a combination of terms
is used. For example,modifiedandsu-
persededdescribes a situation where the
substance of a previously published ruling
is being changed in part and is continued
without change in part and it is desired to
restate the valid portion of the previously
published ruling in a new ruling that is self
contained. In this case, the previously pub-
lished ruling is first modified and then, as
modified, is superseded.
Supplementedis used in situations in
which a list, such as a list of the names of
countries, is published in a ruling and that
list is expanded by adding further names in
subsequent rulings. After the original rul-
ing has been supplemented several times, a
new ruling may be published that includes
the list in the original ruling and the ad-
ditions, and supersedes all prior rulings in
the series.
Suspendedis used in rare situations to
show that the previous published rulings
will not be applied pending some future
action such as the issuance of new or
amended regulations, the outcome of cases
in litigation, or the outcome of a Service
study.
Abbreviations
The fol
lowing abbreviations in current use
and for
merly used will appear in material
publis
hedintheBulletin.
A—Individual.
Acq.—A
cquiescence.
B—Individual.
BE—Beneficiary.
BK—Bank
.
B.T.A.—Board of Tax Appeals.
C—Individual.
C.B.—Cu
mulative Bulletin.
CFR—Code of Federal Regulations.
CI—City.
COOP—Coo
perative.
Ct.D.—Court Decision.
CY—County.
D—Decede
nt.
DC—Dummy Corporation.
DE—Donee.
Del. Order
—Delegation Order.
DISC—Domestic International Sales Corporation.
DR—Donor.
E—Estate.
EE—Employee.
E.O.—Executive Order.
ER—Emp
loyer.
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduc
iary.
FC—Foreign Country.
FICA—Federal Insurance Contributions Act.
FISC—Fo
reign International Sales Company.
FPH—Foreign Personal Holding Company.
F.R.—Federal Register.
FUTA—Fed
eral Unemployment Tax Act.
FX—Foreign corporation.
G.C.M.—Chief Counsel’s Memorandum.
GE—Grante
e.
GP—General Partner.
GR—Grantor.
IC—Insura
nce Company.
I.R.B.—Internal Revenue Bulletin.
LE—Lessee.
LP—Limited
Partner.
LR—Lessor.
M—Minor.
Nonacq.—No
nacquiescence.
O—Organization.
P—Parent Corporation.
PHC—Persona
l Holding Company.
PO—Possession of the U.S.
PR—Partner.
PRS—Pa
rtnership.
PTE—Prohibited Transaction Exemption.
Pub. L.—Public Law.
REIT—Re
al Estate Investment Trust.
Rev. Proc.—Revenue Procedure.
Rev. Rul.—Revenue Ruling.
S—Subsi
diary.
S.P.R.—Statement of Procedural Rules.
Stat.—Statutes at Large.
T—Target
Corporation.
T.C.—Tax Court.
T.D.—Treasury Decision.
TFE—Trans
feree.
TFR—Transferor.
T.I.R.—Technical Information Release.
TP—Taxpay
er.
TR—Trust.
TT—Trustee.
U.S.C.—Uni
ted States Code.
X—Corporation.
Y—Corporation.
Z—Corporat
ion.
January 17, 2012i2012–3 I.R.B.

Numerical Finding List
1
Bulletins 2012–1 through 2012–3
Announcements:
2012-1, 2012-1 I.R.B.249
2012-2, 2012-2 I.R.B.285
Notices:
2012-1, 2012-2 I.R.B.260
2012-3, 2012-3 I.R.B.289
2012-4, 2012-3 I.R.B.290
2012-5, 2012-3 I.R.B.291
2012-6, 2012-3 I.R.B.293
Proposed Regulations:
REG-149625-10, 2012-2 I.R.B.279
Revenue Procedures:
2012-1, 2012-1 I.R.B.1
2012-2, 2012-1 I.R.B.92
2012-3, 2012-1 I.R.B.113
2012-4, 2012-1 I.R.B.125
2012-5, 2012-1 I.R.B.169
2012-6, 2012-1 I.R.B.197
2012-7, 2012-1 I.R.B.232
2012-8, 2012-1 I.R.B.235
2012-9, 2012-2 I.R.B.261
2012-10, 2012-2 I.R.B.273
2012-12, 2012-2 I.R.B.275
2012-13, 2012-3 I.R.B.295
2012-14, 2012-3 I.R.B.296
Revenue Rulings:
2012-1, 2012-2 I.R.B.255
2012-2, 2012-3 I.R.B.286
Treasury Decisions:
9559, 2012-2 I.R.B.252
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2011–27 through 2011–52 is in Internal Revenue Bulletin
2011–52, dated December 27, 2011.
2012–3 I.R.B.iiJanuary 17, 2012

Finding List of Current Actions on
Previously Published Items
1
Bulletins 2012–1 through 2012–3
Notices:
2010-88
As modified by Ann. 2011-40, is superseded by
Notice 2012-1, 2012-2 I.R.B.260
Revenue Procedures:
2011-1
Superseded by
Rev. Proc. 2012-1, 2012-1 I.R.B.1
2011-2
Superseded by
Rev. Proc. 2012-2, 2012-1 I.R.B.92
2011-3
Superseded by
Rev. Proc. 2012-3, 2012-1 I.R.B.113
2011-4
Superseded by
Rev. Proc. 2012-4, 2012-1 I.R.B.125
2011-5
Superseded by
Rev. Proc. 2012-5, 2012-1 I.R.B.169
2011-6
Superseded by
Rev. Proc. 2012-6, 2012-1 I.R.B.197
2011-7
Superseded by
Rev. Proc. 2012-7, 2012-1 I.R.B.232
2011-8
Superseded by
Rev. Proc. 2012-8, 2012-1 I.R.B.235
2011-9
Superseded by
Rev. Proc. 2012-9, 2012-2 I.R.B.261
2011-10
Superseded by
Rev. Proc. 2012-10, 2012-2 I.R.B.273
Revenue Rulings:
2008-40
Modified by
Notice 2012-6, 2012-3 I.R.B.293
2011-1
Modified by
Notice 2012-6, 2012-3 I.R.B.293
1
A cumulative list of current actions on previously published items in Internal Revenue Bulletins 2011–27 through 2011–52 is in Internal Revenue Bulletin 2011–52, dated December 27,
2011.
January 17, 2012iii2012–3 I.R.B.

2012–3 I.R.B.January 17, 2012

January 17, 20122012–3 I.R.B.

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