Proposed Regulations Issued on Contributions to Nuclear Decommissioning Reserve Fund (REG-112800-16)

CCH Tax Day Report

The IRS has issued proposed regulations under Code Sec. 468A relating to the deduction and use of contributions to a qualified fund maintained for decommissioning nuclear power plants. Under the proposed rules, the definition of deductible nuclear decommissioning costs includes amounts spent for purchase or construction of a depreciable asset as part of the decommissioning process, as well as amounts related to the storage of spent fuel (ISFSI costs). The proposals also clarify that reimbursements of decommissioning costs by the qualified fund to related parties that paid such costs are not an act of self-dealing. Also, the definition of substantial completion of the decommissioning of a nuclear power plant includes the date on which all Federal, state, local and contractual liabilities are fully satisfied.

Comments Requested

The IRS requests comments on the clarity of the proposed rules. A public hearing will be scheduled if requested in writing by any person that timely submits written comments. If a public hearing is scheduled, notice of the date, time and place for the public hearing will be published in the Federal Register. Submissions should be sent to: CC:PA:LPD:PR (REG-112800-16), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, D.C. 20044. Submissions may be also hand delivered Monday through Friday between the hours of 8:00 a.m. and 4:00 p.m. to CC:PA:LPD:PR (REG-112800-16), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, D.C., or sent electronically via the Federal eRulemaking Portal at http://www.regulations.gov (indicate IRS REG-112800-16).

Proposed Regulations, NPRM REG-112800-16, 2017FED ¶49,730

Other References:

Code Sec. 468A

CCH Reference – 2016FED ¶21,932B

CCH Reference – 2016FED ¶21,936B

Tax Research Consultant

CCH Reference – TRC ACCTNG: 12,208

CCH Reference – TRC ACCTNG: 12,208.20

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CCHTaxGroup

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