Rule2021-14050
Removal of Obsolete Regulation Regarding Rewards for Information Relating to Violations of Tax Laws Administered by the Alcohol and Tobacco Tax and Trade Bureau
Primary source
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Published
July 1, 2021
Effective
July 1, 2021
Issuing agencies
Treasury DepartmentAlcohol and Tobacco Tax and Trade Bureau
Abstract
In this final rule, the Alcohol and Tobacco Tax and Trade Bureau (TTB) is removing obsolete regulatory provisions related to whistleblower rewards. Under the Internal Revenue Code, individuals who provide information to the Treasury Department regarding underpayment of taxes or violations of internal revenue laws may file claims for monetary ``whistleblower'' awards. Recent changes to the Code have made the TTB regulation regarding whistleblower rewards obsolete, and, therefore, TTB is removing that provision from its regulations. TTB has signed a memorandum of understanding with the Internal Revenue Service, under which the Internal Revenue Service will process whistleblower award claims for information regarding underpayment of taxes collected by TTB or violations of the internal revenue laws administered by TTB.
Full Text
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<title>Federal Register, Volume 86 Issue 124 (Thursday, July 1, 2021)</title>
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[Federal Register Volume 86, Number 124 (Thursday, July 1, 2021)]
[Rules and Regulations]
[Pages 34957-34958]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-14050]
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DEPARTMENT OF THE TREASURY
Alcohol and Tobacco Tax and Trade Bureau
27 CFR Part 70
[Docket No. TTB-2021-0004; T.D. TTB-169]
RIN 1513-AC56
Removal of Obsolete Regulation Regarding Rewards for Information
Relating to Violations of Tax Laws Administered by the Alcohol and
Tobacco Tax and Trade Bureau
AGENCY: Alcohol and Tobacco Tax and Trade Bureau, Treasury.
ACTION: Final rule; Treasury decision.
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SUMMARY: In this final rule, the Alcohol and Tobacco Tax and Trade
Bureau (TTB) is removing obsolete regulatory provisions related to
whistleblower rewards. Under the Internal Revenue Code, individuals who
provide information to the Treasury Department regarding underpayment
of taxes or violations of internal revenue laws may file claims for
monetary ``whistleblower'' awards. Recent changes to the Code have made
the TTB regulation regarding whistleblower rewards obsolete, and,
therefore, TTB is removing that provision from its regulations. TTB has
signed a memorandum of understanding with the Internal Revenue Service,
under which the Internal Revenue Service will process whistleblower
award claims for information regarding underpayment of taxes collected
by TTB or violations of the internal revenue laws administered by TTB.
DATES: This final rule is effective on July 1, 2021.
FOR FURTHER INFORMATION CONTACT: Michael Hoover, Regulations and
Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, 1310 G
Street NW, Box 12, Washington, DC 20005; 202-453-1039, ext. 135.
SUPPLEMENTARY INFORMATION:
Background
The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers the
following provisions of the Internal Revenue Code of 1986, as amended
(IRC, 26 U.S.C.): Chapter 51 (imposing Federal excise tax on distilled
spirits, wine, and beer), chapter 52 (imposing Federal excise tax on
tobacco products and cigarette papers and tubes), and sections 4181-
4182 (imposing Federal excise tax on firearms and ammunition). TTB
administers these provisions pursuant to section 1111(d) of the
Homeland Security Act of 2002, as codified at 6 U.S.C. 531(d). The
Secretary of the Treasury (the Secretary) has delegated related IRC
administrative and enforcement authorities to TTB through Treasury
Order 120-01. The Secretary also has delegated administration and
enforcement of other internal revenue laws to the Internal Revenue
Service under Treasury Order 150-10.
Under section 7623 of the IRC (26 U.S.C. 7623), individuals who
provide information to the Department of the Treasury that is used to
detect underpayments of Federal taxes or violations of internal revenue
laws may be eligible for monetary ``whistleblower'' awards under
regulations issued by the Secretary.
TTB had previously issued a whistleblower reward regulation at 27
CFR 70.41. However, amendments to the Internal Revenue Code have made
this regulation obsolete. See the amendments made to 26 U.S.C. 7623 by
section 406 of the Tax Relief and Health Care Act of 2006 (Pub L. 109-
432), section 41108 of the Balanced Budget Act of 2018 (Pub. L. 115-
123), and section 1405 of the Taxpayer First Act (Pub. L. 116-25). As a
result of these statutory amendments, described more fully below, Sec.
70.41 has become obsolete, and TTB is removing that section from its
regulations in 27 CFR part 70, Procedure and Administration.
Section 406 of the Tax Relief and Health Care Act of 2006
significantly revised 26 U.S.C. 7623 and required the Treasury
Department to establish a ``Whistleblower Office'' within the Internal
Revenue Service (IRS) to analyze information received by whistleblower
claimants and determine the amount of any award under 26 U.S.C.
7623(b). The IRS Whistleblower Office processes claims pertaining to
underpayments of tax that are owed to the IRS or violations of internal
revenue laws administered by the IRS that may be eligible for an award
under 26 U.S.C. 7623(a) and (b). See IRS Delegation Order 25-07
(delegation to the Whistleblower Office of the authority to approve IRS
discretionary awards under section 7623(a)). Section 41108 of the
Balanced Budget Act of 2018 then clarified the definition of
``collected proceeds'' from which the Treasury Department may make
awards to whistleblowers. The Taxpayer First Act further amended 26
U.S.C. 7623 by establishing a notification process for whistleblowers
and adding protections for whistleblowers against retaliation.
To modernize the process for accepting, processing, and rewarding
whistleblowers and to give effect to the statutory changes, TTB has
entered into
[[Page 34958]]
a memorandum of understanding (MOU) with the IRS Whistleblower Office.
As set forth in that MOU, the IRS Whistleblower Office will accept
claims from whistleblowers via IRS Form 211, Application for Award for
Original Information, and refer such information to TTB when
applicable. TTB will determine if the information is actionable after
any investigation undertaken, collect proceeds, and provide
information, including an evaluation of the whistleblower's
contributions, to the IRS Whistleblower Office. The IRS Whistleblower
Office will process all TTB-related whistleblower award claims filed
under 26 U.S.C. 7623 under the IRS regulations and procedures. Under
the MOU, the IRS will consider references to the ``Internal Revenue
Service'' or ``IRS'' in the relevant IRS regulations and procedures to
include TTB personnel and TTB actions when appropriate.
Updated information on the whistleblower program, including how and
where to file such claims with the IRS Whistleblower Office is
available on the TTB website at <a href="http://www.ttb.gov">www.ttb.gov</a>.
Regulatory Analysis and Notices
Executive Order 12866
It has been determined that this notice is not a significant
regulatory action as defined in Executive Order 12866 of September 30,
1993. Therefore, a regulatory assessment is not necessary.
Inapplicability of Prior Notice and Public Comment Procedures and
Delayed Effective Date
TTB is issuing this final rule without prior notice and opportunity
for public comment pursuant to authority under section 4(a) of the
Administrative Procedure Act, as amended (APA) (5 U.S.C. 553(b)(B)).
That provision authorizes an agency to issue a rule without prior
notice when the agency for good cause finds that those procedures are
``impracticable, unnecessary, or contrary to the public interest.'' In
this final rule, TTB is removing a regulatory provision that has become
obsolete due to statutory changes, so TTB finds that prior notice is
unnecessary. TTB also finds that it is unnecessary to provide a delayed
effective date for revoking its obsolete regulation under section 4(c)
of the APA (5 U.S.C. 553(d)); this rule is therefore effective
immediately.
Regulatory Flexibility Act
Because no notice of proposed rulemaking is required, the
provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) do
not apply. Pursuant to 26 U.S.C. 7805(f), TTB submitted this final rule
to the Chief Counsel for Advocacy of the Small Business Administration
(SBA) for comment on the impact of the regulations on small businesses.
TTB received no comments from SBA in response to this final rule.
Paperwork Reduction Act
This final rule imposes no new collection of information. The IRS
will account for any burden associated with additional respondents to
its information collection, IRS Form 211, Application for Reward for
Original Information (20,000 annual respondents and 15,000 burden
hours), which has been previously reviewed and approved by OMB and
assigned control number 1545-0409.
Drafting Information
Michael Hoover of the Regulations and Rulings Division drafted this
document with the assistance of other Alcohol and Tobacco Tax and Trade
Bureau personnel.
List of Subjects in 27 CFR Part 70
Administrative practice and procedure, Claims, Excise taxes,
Freedom of information, Law enforcement, Penalties, Reporting and
recordkeeping requirements, Surety bonds.
Amendments to the Regulations
For the reasons discussed in the preamble, TTB is amending 27 CFR
chapter I, part 70 as follows:
PART 70--PROCEDURE AND ADMINISTRATION
0
1. The authority citation for part 70 continues to read as follows:
Authority: 5 U.S.C. 301 and 552; 26 U.S.C. 4181, 4182, 5123,
5203, 5207, 5275, 5367, 5415, 5504, 5555, 5684(a), 5741, 5761(b),
5802, 6020, 6021, 6064, 6102, 6155, 6159, 6201, 6203, 6204, 6301,
6303, 6311, 6313, 6314, 6321, 6323, 6325, 6326, 6331-6343, 6401-
6404, 6407, 6416, 6423, 6501-6503, 6511, 6513, 6514, 6532, 6601,
6602, 6611, 6621, 6622, 6651, 6653, 6656-6658, 6665, 6671, 6672,
6701, 6723, 6801, 6862, 6863, 6901, 7011, 7101, 7102, 7121, 7122,
7207, 7209, 7214, 7304, 7401, 7403, 7406, 7423, 7424, 7425, 7426,
7429, 7430, 7432, 7502, 7503, 7505, 7506, 7513, 7601-7606, 7608-
7610, 7622, 7623, 7653, 7805.
Sec. 70.41 [Removed and Reserved]
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2. Section 70.41 is removed and reserved.
Signed: June 21, 2021.
Mary G. Ryan,
Administrator.
Approved: June 21, 2021.
Timothy E. Skud,
Deputy Assistant Secretary (Tax, Trade and Tariff Policy).
[FR Doc. 2021-14050 Filed 6-30-21; 8:45 am]
BILLING CODE 4810-31-P
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</html>Indexed from Federal Register on July 1, 2021.
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