[Federal Register Volume 59, Number 143 (Wednesday, July 27, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18193]
[[Page Unknown]]
[Federal Register: July 27, 1994]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 301
[TD 8557]
RIN 1545-AM64
Place for Filing Lien on Personal Property
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
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SUMMARY: This document contains final regulations regarding the place
for filing a notice of tax lien against personal property. Sections
1015(s)(1) (A) and (B) of the Technical and Miscellaneous Revenue Act
of 1988 (TAMRA), amended section 6323 of the Internal Revenue Code to
provide that a state conforming to or reenacting a federal law
establishing a national filing system is not considered to have
designated a second office for filing a notice of tax lien. TAMRA also
amended section 6323 to provide that the filing of a notice of federal
tax lien is governed solely by the Internal Revenue Code and is not
subject to any other federal law that establishes a national filing
system.
EFFECTIVE DATE: These final regulations are effective April 21, 1993.
FOR FURTHER INFORMATION CONTACT: Robert A. Walker, 202-622-3209 (not a
toll-free call).
SUPPLEMENTARY INFORMATION:
Background
These final regulations amend the Procedure and Administration
Regulations (26 CFR part 301) under section 6323 of the Internal
Revenue Code (Code). The regulations reflect the amendment of section
6323 by sections 1015(s)(1) (A) and (B) of the Technical and
Miscellaneous Revenue Act of 1988, Pub. L. 100-647, 102 Stat. 3573)
(TAMRA).
The IRS published a notice of proposed rulemaking in the Federal
Register on April 22, 1993, (58 FR 21550) providing proposed rules
under section 6323 of the Code. No public comments were received and
accordingly, the final regulations are substantially identical to the
proposed regulations. Certain minor stylistic changes have been made.
Explanation of Provisions
Sections 1015(s)(1) (A) and (B) of TAMRA amended section 6323(f) of
the Code by clarifying that a state's conformance to or reenactment of
a federal law establishing a national filing system for personal
property does not constitute a second office for filing in that state.
The existing regulations provide that if a state has designated more
than one office for filing liens, the IRS must file the notice of tax
lien with the clerk of the appropriate United States district court.
TAMRA also clarified that the filing of notices of liens by the IRS is
to be governed solely by the Code and is not subject to any other
federal law establishing a national filing system.
TAMRA's amendments to the Code were in response to United States v.
Air Florida, Inc., 56 B.R. 732 (S.D. Fla. 1985). In that case, the IRS
filed its Notice of Federal Tax Lien with the clerk of the county
circuit court, but the court held that under section 6323(f)(1) the IRS
was instead required to file its Notice of Federal Tax Lien in the
office of the clerk of the United States district court. The court
found that the State of Florida had designated not one, but two offices
for the filing of Federal tax liens against personal property: The
office of the clerk of the circuit court of the county in which the
personal property was located and, because the state had adopted the
U.S. government's national filing system for civil aircraft, the
F.A.A.'s offices in Oklahoma City, Oklahoma. The final regulations
revise Sec. 301.6323(f)-1 by providing that state law that conforms to
or reenacts a federal law establishing a national filing system does
not constitute a second office for filing; by providing that the filing
of liens is not subject to federal laws (other than the Code)
establishing a national filing system for liens; and by adding two
examples, one of which resembles the fact pattern of the Air Florida
case.
Special Analyses
It has been determined that this Treasury Decision is not a
significant regulatory action as defined in EO 12866. Therefore, a
regulatory assessment is not required. It has also been determined that
section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5)
and the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply to
these regulations, and, therefore, a Regulatory Flexibility Analysis is
not required. Pursuant to section 7805(f) of the Internal Revenue Code,
the notice of proposed rulemaking was submitted to the Chief Counsel
for Advocacy of the Small Business Administration for comment on its
impact on small business.
Drafting Information
The principal author of these proposed regulations is Robert A.
Walker, Office of the Assistant Chief Counsel (General Litigation),
IRS. However, other personnel from the IRS and Treasury Department
participated in their development.
List of Subjects in 26 CFR Part 301
Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income
taxes, Penalties, Reporting and recordkeeping requirements.
Adoption of Amendments to the Regulations
Accordingly, 26 CFR part 301 is amended as follows:
Paragraph 1. The authority citation for part 301 continues to read
in part as follows:
Authority: 26 U.S.C. 7805 * * *.
Par. 2. Section 301.6323(f)-1 is amended as follows:
1. Two sentences are added at the end of paragraph (a)(2).
2. Paragraphs (c) and (d) are redesignated as paragraphs (d) and
(e), respectively.
3. A new paragraph (c) is added.
4. Newly designated paragraph (e) is amended by adding Example 5
and Example 6.
5. The additions and revisions read as follows:
Sec. 301.6323(f)-1 Place for filing notice; form.
(a) * * *
(2) * * *
A state law that conforms to or reenacts a federal law establishing
a national filing system does not constitute a designation by state law
of an office for filing liens against personal property. Thus, if state
law provides that a notice of lien affecting personal property must be
filed in the office of the county clerk for the county in which the
taxpayer resides and also adopts a federal law that requires a notice
of lien to be filed in another location in order to attach to a
specific type of property, the state is considered to have designated
only one office for the filing of the notice of lien, and to protect
its lien the Internal Revenue Service need only file its notice in the
office of the county clerk for the county in which the taxpayer
resides.
* * * * *
(c) National filing system. The filing of federal tax liens is to
be governed solely by the Internal Revenue Code and is not subject to
any other federal law that may establish a national system for filing
liens and encumbrances against a particular type of personal property.
Thus, for example, the Service is not subject to the requirements
established by the Federal Aviation Agency for filing liens against
civil aircraft in Oklahoma City, Oklahoma.
* * * * *
(e) * * *
Example 5. The law of State F provides that notices of lien
affecting personal property are to be filed with the clerk of the
circuit court in the county in which the personal property is
located. State F has conformed state law to federal law to provide
that all instruments affecting title to an interest in any civil
aircraft of the United States must be recorded in the Office of the
Federal Aviation Administrator (FAA) in Oklahoma City, Oklahoma. On
July 1, 1990, a tax lien arises against ABC airline, which owns
aircraft situated in State F. The Internal Revenue Service files a
Notice of Federal Tax Lien with the clerk of the circuit court in
the county in which the aircraft is located but does not file the
notice with the FAA in Oklahoma City, Oklahoma. Because the FAA
system adopted by State F does not constitute a second place of
filing pursuant to section 6323(f), the federal tax lien is validly
filed.
Example 6. Assume the same facts as Example 5 except that State
F did not reenact or conform state law to the FAA requirements. The
result is the same because the filing of federal tax liens is
governed solely by the Internal Revenue Code, and is not subject to
any other national filing system.
Margaret Milner Richardson,
Commissioner of Internal Revenue.
Approved: June 10, 1994.
Leslie Samuels,
Assistant Secretary of the Treasury.
[FR Doc. 94-18193 Filed 7-26-94; 8:45 am]
BILLING CODE 4830-01-U