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Internal Revenue Bulletin:  2014-47 

November 17, 2014 

Rev. Proc. 2014–61


Table of Contents
SECTION 1. PURPOSE
SECTION 2. CHANGES
SECTION 3. 2015 ADJUSTED ITEMS
  Code Section
.01 Tax Rate Tables 1(a)–(e)
.02 Unearned Income of Minor Children Taxed as if Parent's Income (“Kiddie Tax”). 1(g)
.03 Adoption Credit 23
.04 Child Tax Credit 24
.05 Hope Scholarship and Lifetime Learning Credits 25A
.06 Earned Income Credit 32
.07 Refundable Credit for Covertage Under a Qualified Health Plan 36B(f)(2)(B)
.08 Rehabilitation Expenditures Treated as Separate New Building 42(e)
.09 Low-Income Housing Credit 42(h)
.10 Employee Health Insurance Expense of Small Employers 45R
.11 Exemption Amounts for Alternative Minimum Tax 55
.12 Alternative Minimum Tax Exemption for a Child Subject to the “Kiddie Tax” 59(j)
.13 Transportation Mainline Pipeline Construction Industry Optional Expense Substantiation Rules for Payments to Employees under Accountable Plans 62(c)
.14 Standard Deduction 63
.15 Overall Limitation on Itemized Deductions 68
.16 Cafeteria Plans 125
.17 Qualified Transportation Fringe Benefit 132(f)
.18 Income from United States Savings Bonds for Taxpayers Who Pay Qualified Higher Education Expenses 135
.19 Adoption Assistance Programs 137
.20 Private Activity Bonds Volume Cap 146(d)
.21 Loan Limits on Agricultural Bonds 147(c)(2)
.22 General Arbitrage Rebate Rules 148(f)
.23 Safe Harbor Rules for Broker Commissions on Guaranteed Investment Contracts or Investments Purchased for a Yield Restricted Defeasance Escrow 148
.24 Personal Exemption 151
.25 Eligible Long-Term Care Premiums 213(d)(10)
.26 Medical Savings Accounts 220
.27 Interest on Education Loans 221
.28 Treatment of Dues Paid to Agricultural or Horticultural Organizations 512(d)
.29 Insubstantial Benefit Limitations for Contributions Associated With Charitable Fund-Raising Campaigns 513(h)
.30 Expatriation to Avoid Tax 877
.31 Tax Responsibilities of Expatriation 877A
.32 Foreign Earned Income Exclusion 911
.33 Unified Credit Against Estate Tax 2010
.34 Valuation of Qualified Real Property in Decedent's Gross Estate 2032A
.35 Annual Exclusion for Gifts 2503; 2523
.36 Tax on Arrow Shafts 4161
.37 Passenger Air Transportation Excise Tax 4261
.38 Reporting Exception for Certain Exempt Organizations with Nondeductible Lobbying Expenditures 6033(e)(3)
.39 Notice of Large Gifts Received from Foreign Persons 6039F
.40 Persons Against Whom a Federal Tax Lien Is Not Valid 6323
.41 Property Exempt from Levy 6334
.42 Interest on a Certain Portion of the Estate Tax Payable in Installments 6601(j)
.43 Attorney Fee Awards 7430
.44 Periodic Payments Received under Qualified Long-Term Care Insurance Contracts or under Certain Life Insurance Contracts 7702B(d)
SECTION 4. EFFECTIVE DATE  
SECTION 5. DRAFTING INFORMATION  

SECTION 1. PURPOSE

This revenue procedure sets forth inflation-adjusted items for 2015.

SECTION 2. CHANGES

Section 1401 of the Patient Protection and Affordable Care Act of 2010, Pub. L. No. 111–148, 124 Stat. 119 (PPACA), added § 36B to the Internal Revenue Code. Section 36B creates a refundable tax credit (“the premium tax credit”) for eligible individuals and families who purchase health insurance through a Health Insurance Marketplace. Taxpayers who meet certain criteria may have some or all of their estimated premium tax credit paid in advance directly to the insurance company to assist with the cost of monthly premiums. These amounts are called advance credit payments. The amount of a taxpayer’s premium tax credit allowed for a taxable year is reduced by the amount of the advance credit payments made for the taxpayer during the year. If a taxpayer’s advance credit payments for a taxable year exceed the premium tax credit allowed for the year, the taxpayer owes the excess as an additional tax, subject to a limitation in § 36B(f)(2)(B). The limitation amounts on the increase of tax for excess advance credit payments under § 36B(f)(2)(B) are adjusted for inflation for taxable years beginning after December 31, 2014. The U.S. Department of the Treasury and the IRS will issue future guidance as necessary to provide the applicable inflation adjusted items under section 36B(b)(3)(A)(ii) that are used to determine (1) a taxpayer’s premium assistance amount under section 36B(b)(2), and (2) the required contribution percentage under section 36B(c)(2)(C)(i)(II) for determining the employer-sponsored minimum essential coverage.

SECTION 3. 2015 ADJUSTED ITEMS

.01 Tax Rate Tables. For taxable years beginning in 2015, the tax rate tables under § 1 are as follows:

TABLE 1 — Section 1(a) — Married Individuals Filing Joint Returns and Surviving Spouses
If Taxable Income Is: The Tax Is:
Not over $18,450 10% of the taxable income
Over $18,450 but not over $74,900 $1,845 plus 15% of the excess over $18,450
Over $74,900 but not over $151,200 $10,312.50 plus 25% of the excess over $74,900
Over $151,200 but not over $230,450 $29,387.50 plus 28% of the excess over $151,200
Over $230,450 but not over $411,500 $51,577.50 plus 33% of the excess over $230,450
Over $411,500 but not over $464,850 $111,324 plus 35% of the excess over $411,500
Over $464,850 $129,996.50 plus 39.6% of the excess over $464,850
TABLE 2 — Section 1(b) — Heads of Households
If Taxable Income Is: The Tax Is:
Not over $13,150 10% of the taxable income
Over $13,150 but not over $50,200 $1,315 plus 15% of the excess over $13,150
Over $50,200 but not over $129,600 $6,872.50 plus 25% of the excess over $50,200
Over $129,600 but not over $209,850 $26,722.50 plus 28% of the excess over $129,600
Over $209,850 but not over $411,500 $49,192.50 plus 33% of the excess over $209,850
Over $411,500 not over $439,000 $115,737 plus 35% of the excess over $411,500
Over $439,000 $125,362 plus 39.6% of the excess over $439,000
TABLE 3 — Section 1(c) — Unmarried Individuals (other than Surviving Spouses and Heads of Households)
If Taxable Income Is: The Tax Is:
Not over $9,225 10% of the taxable income
Over $9,225 but not over $37,450 $922.50 plus 15% of the excess over $9,225
Over $37,450 but not over $90,750 $5,156.25 plus 25% of the excess over $37,450
Over $90,750 but not over $189,300 $18,481.25 plus 28% of the excess over $90,750
Over $189,300 but not over $411,500 $46,075.25 plus 33% of the excess over $189,300
Over $411,500 not over $413,200 $119,401.25 plus 35% of the excess over $411,500
Over $413,200 $119,996.25 plus 39.6% of the excess over $413,200
TABLE 4 — Section 1(d) — Married Individuals Filing Separate Returns
If Taxable Income Is: The Tax Is:
Not over $9,225 10% of the taxable income
Over $9,225 but not over $37,450 $922.50 plus 15% of the excess over $9,225
Over $37,450 but not over $75,600 $5,156.25 plus 25% of the excess over $37,450
Over $75,600 but not over $115,225 $14,693.75 plus 28% of the excess over $75,600
Over $115,225 but not over $205,750 $25,788.75 plus 33% of the excess over $115,225
Over $205,750 not over $232,425 $55,662 plus 35% of the excess over $205,750
Over $232,425 $64,998.25 plus 39.6% of the excess over $232,425
TABLE 5 — Section 1(e) — Estates and Trusts
If Taxable Income Is: The Tax Is:
Not over $2,500 15% of the taxable income
Over $2,500 but not over $5,900 $375 plus 25% of the excess over $2,500
Over $5,900 but not over $9,050 $1,225 plus 28% of the excess over $5,900
Over $9,050 but not over $12,300 $2,107 plus 33% of the excess over $9,050
Over $12,300 $3,179.50 plus 39.6% of the excess over $12,300

.02 Unearned Income of Minor Children Taxed as if Parent’s Income (the “Kiddie Tax”). For taxable years beginning in 2015, the amount in § 1(g)(4)(A)(ii)(I), which is used to reduce the net unearned income reported on the child’s return that is subject to the “kiddie tax,” is $1,050. This $1,050 amount is the same as the amount provided in § 63(c)(5)(A), as adjusted for inflation. The same $1,050 amount is used for purposes of § 1(g)(7) (that is, to determine whether a parent may elect to include a child’s gross income in the parent’s gross income and to calculate the “kiddie tax”). For example, one of the requirements for the parental election is that a child’s gross income is more than the amount referenced in § 1(g)(4)(A)(ii)(I) but less than 10 times that amount; thus, a child’s gross income for 2015 must be more than $1,050 but less than $10,500.

.03 Adoption Credit. For taxable years beginning in 2015, under § 23(a)(3) the credit allowed for an adoption of a child with special needs is $13,400. For taxable years beginning in 2015, under § 23(b)(1) the maximum credit allowed for other adoptions is the amount of qualified adoption expenses up to $13,400. The available adoption credit begins to phase out under § 23(b)(2)(A) for taxpayers with modified adjusted gross income in excess of $201,010 and is completely phased out for taxpayers with modified adjusted gross income of $241,010 or more. (See section 3.19 of this revenue procedure for the adjusted items relating to adoption assistance programs.)

.04 Child Tax Credit. For taxable years beginning in 2015, the value used in § 24(d)(1)(B)(i) to determine the amount of credit under § 24 that may be refundable is $3,000.

.05 Hope Scholarship, American Opportunity, and Lifetime Learning Credits.

(1) For taxable years beginning in 2015, the Hope Scholarship Credit under § 25A(b)(1), as increased under § 25A(i) (the American Opportunity Tax Credit), is an amount equal to 100 percent of qualified tuition and related expenses not in excess of $2,000 plus 25 percent of those expenses in excess of $2,000, but not in excess of $4,000. Accordingly, the maximum Hope Scholarship Credit allowable under § 25A(b)(1) for taxable years beginning in 2015 is $2,500.

(2) For taxable years beginning in 2015, a taxpayer’s modified adjusted gross income in excess of $80,000 ($160,000 for a joint return) is used to determine the reduction under § 25A(d)(2) in the amount of the Hope Scholarship Credit otherwise allowable under § 25A(a)(1). For taxable years beginning in 2015, a taxpayer’s modified adjusted gross income in excess of $55,000 ($110,000 for a joint return) is used to determine the reduction under § 25A(d)(2) in the amount of the Lifetime Learning Credit otherwise allowable under § 25A(a)(2).

.06 Earned Income Credit.

(1) In general. For taxable years beginning in 2015, the following amounts are used to determine the earned income credit under § 32(b). The “earned income amount” is the amount of earned income at or above which the maximum amount of the earned income credit is allowed. The “threshold phaseout amount” is the amount of adjusted gross income (or, if greater, earned income) above which the maximum amount of the credit begins to phase out. The “completed phaseout amount” is the amount of adjusted gross income (or, if greater, earned income) at or above which no credit is allowed. The threshold phaseout amounts and the completed phaseout amounts shown in the table below for married taxpayers filing a joint return include the increase provided in § 32(b)(3)(B)(i), as adjusted for inflation for taxable years beginning in 2015.

Number of Qualifying Children
Item One Two Three or More None
Earned Income Amount $9,880 $13,870 $13,870 $6,580
Maximum Amount of Credit $3,359 $5,548 $6,242 $503
Threshold Phaseout Amount (Single, Surviving Spouse, or Head of Household) $18,110 $18,110 $18,110 $8,240
Completed Phaseout Amount (Single, Surviving Spouse, or Head of Household) $39,131 $44,454 $47,747 $14,820
Threshold Phaseout Amount (Married Filing Jointly) $23,630 $23,630 $23,630 $13,750
Completed Phaseout Amount (Married Filing Jointly) $44,651 $49,974 $53,267 $20,330

The instructions for the Form 1040 series provide tables showing the amount of the earned income credit for each type of taxpayer.

(2) Excessive Investment Income. For taxable years beginning in 2015, the earned income tax credit is not allowed under § 32(i) if the aggregate amount of certain investment income exceeds $3,400.

.07 Refundable Credit for Coverage Under a Qualified Health Plan. For taxable years beginning in 2015, the limitation on tax imposed under § 36B(f)(2)(B) for excess advance credit payments is determined using the following table:

If the household income (expressed as a percent of poverty line) is:    
The limitation amount for unmarried individuals (other than surviving spouses and heads of household) is: The limitation amount for all other taxpayers is:  
Less than 200% $300 $600
At least 200% but less than 300% $750 $1,500
At least 300% but less than 400% $1,250 $2,500

.08 Rehabilitation Expenditures Treated as Separate New Building. For calendar year 2015, the per low-income unit qualified basis amount under § 42(e)(3)(A)(ii)(II) is $6,600.

.09 Low-Income Housing Credit. For calendar year 2015, the amount used under § 42(h)(3)(C)(ii) to calculate the State housing credit ceiling for the low-income housing credit is the greater of (1) $2.30 multiplied by the State population, or (2) $2,680,000.

.10 Employee Health Insurance Expense of Small Employers. For taxable years beginning in 2015, the dollar amount in effect under § 45R(d)(3)(B) is $25,800. This amount is used under § 45R(c) for limiting the small employer health insurance credit and under § 45R(d)(1)(B) for determining who is an eligible small employer for purposes of the credit.

.11 Exemption Amounts for Alternative Minimum Tax. For taxable years beginning in 2015, the exemption amounts under § 55(d)(1) are:

Joint Returns or $83,400
Surviving Spouses  
Unmarried Individuals (other than $53,600
Surviving Spouses)  
Married Individuals Filing Separate $41,700
Returns  
Estates and Trusts $23,800

For taxable years beginning in 2015, under § 55(b)(1), the excess taxable income above which the 28 percent tax rate applies is:

Married Individuals Filing Separate Returns $92,700
Joint Returns, Unmarried Individuals (other than surviving spouses), and Estates and Trusts $185,400

For taxable years beginning in 2015, the amounts used under § 55(d)(3) to determine the phaseout of the exemption amounts are:

Joint Returns or Surviving Spouses $158,900
Unmarried Individuals (other than Surviving Spouses) $119,200
Married Individuals Filing Separate Returns and Estates and Trusts $79,450

.12 Alternative Minimum Tax Exemption for a Child Subject to the “Kiddie Tax.” For taxable years beginning in 2015, for a child to whom the § 1(g) “kiddie tax” applies, the exemption amount under §§ 55 and 59(j) for purposes of the alternative minimum tax under § 55 may not exceed the sum of (1) the child’s earned income for the taxable year, plus (2) $7,400.

.13 Transportation Mainline Pipeline Construction Industry Optional Expense Substantiation Rules for Payments to Employees under Accountable Plans. For calendar year 2015, an eligible employer may pay certain welders and heavy equipment mechanics an amount of up to $17 per hour for rig-related expenses that are deemed substantiated under an accountable plan if paid in accordance with Rev. Proc. 2002–41, 2002–1 C.B. 1098. If the employer provides fuel or otherwise reimburses fuel expenses, up to $11 per hour is deemed substantiated if paid under Rev. Proc. 2002–41.

.14 Standard Deduction.

(1) In general. For taxable years beginning in 2015, the standard deduction amounts under § 63(c)(2) are as follows:

Filing Status Standard Deduction
Married Individuals Filing Joint Returns and Surviving Spouses (§ 1(a)) $12,600
Heads of Households (§ 1(b)) $9,250
Unmarried Individuals (other than Surviving Spouses and Heads of Households) (§ 1(c)) $6,300
Married Individuals Filing Separate Returns (§ 1(d)) $6,300

(2) Dependent. For taxable years beginning in 2015, the standard deduction amount under § 63(c)(5) for an individual who may be claimed as a dependent by another taxpayer cannot exceed the greater of (1) $1,050, or (2) the sum of $350 and the individual’s earned income.

(3) Aged or blind. For taxable years beginning in 2015, the additional standard deduction amount under § 63(f) for the aged or the blind is $1,250. The additional standard deduction amount is increased to $1,550 if the individual is also unmarried and not a surviving spouse.

.15 Overall Limitation on Itemized Deductions. For taxable years beginning in 2015, the applicable amounts under § 68(b) are $309,900 in the case of a joint return or a surviving spouse, $284,050 in the case of a head of household, $258,250 in the case of an individual who is not married and who is not a surviving spouse or head of household, $154,950 in the case of a married individual filing a separate return.

.16 Cafeteria Plans. For the taxable years beginning in 2015, the dollar limitation under § 125(i) on voluntary employee salary reductions for contributions to health flexible spending arrangements is $2,550.

.17 Qualified Transportation Fringe Benefit. For taxable years beginning in 2015, the monthly limitation under § 132(f)(2)(A) regarding the aggregate fringe benefit exclusion amount for transportation in a commuter highway vehicle and any transit pass is $130. The monthly limitation under § 132(f)(2)(B) regarding the fringe benefit exclusion amount for qualified parking is $250.

.18 Income from United States Savings Bonds for Taxpayers Who Pay Qualified Higher Education Expenses. For taxable years beginning in 2015, the exclusion under § 135, regarding income from United States savings bonds for taxpayers who pay qualified higher education expenses, begins to phase out for modified adjusted gross income above $115,750 for joint returns and $77,200 for all other returns. The exclusion is completely phased out for modified adjusted gross income of $145,750 or more for joint returns and $92,200 or more for all other returns.

.19 Adoption Assistance Programs. For taxable years beginning in 2015, under § 137(a)(2), the amount that can be excluded from an employee’s gross income for the adoption of a child with special needs is $13,400. For taxable years beginning in 2015, under § 137(b)(1) the maximum amount that can be excluded from an employee’s gross income for the amounts paid or expenses incurred by an employer for qualified adoption expenses furnished pursuant to an adoption assistance program for other adoptions by the employee is $13,400. The amount excludable from an employee’s gross income begins to phase out under § 137(b)(2)(A) for taxpayers with modified adjusted gross income in excess of $201,010 and is completely phased out for taxpayers with modified adjusted gross income of $241,010 or more. (See section 3.03 of this revenue procedure for the adjusted items relating to the adoption credit.)

.20 Private Activity Bonds Volume Cap. For calendar year 2015, the amounts used under § 146(d)(1) to calculate the State ceiling for the volume cap for private activity bonds is the greater of (1) $100 multiplied by the State population, or (2) $301,515,000.

.21 Loan Limits on Agricultural Bonds. For calendar year 2015, the loan limit amount on agricultural bonds under § 147(c)(2)(A) for first-time farmers is $517,700.

.22 General Arbitrage Rebate Rules. For bond years ending in 2015, the amount of the computation credit determined under the permission to rely on § 1.148–3(d)(4) of the proposed Income Tax Regulations is $1,650.

.23 Safe Harbor Rules for Broker Commissions on Guaranteed Investment Contracts or Investments Purchased for a Yield Restricted Defeasance Escrow. For calendar year 2015, under § 1.148–5(e)(2)(iii)(B)(1), a broker’s commission or similar fee for the acquisition of a guaranteed investment contract or investments purchased for a yield restricted defeasance escrow is reasonable if (1) the amount of the fee that the issuer treats as a qualified administrative cost does not exceed the lesser of (A) $39,000, and (B) 0.2 percent of the computational base (as defined in § 1.148–5(e)(2)(iii)(B)(2)) or, if more, $4,000; and (2) the issuer does not treat more than $110,000 in brokers’ commissions or similar fees as qualified administrative costs for all guaranteed investment contracts and investments for yield restricted defeasance escrows purchased with gross proceeds of the issue.

.24 Personal Exemption.

(1) For taxable years beginning in 2015, the personal exemption amount under § 151(d) is $4,000.

(2) Phaseout. For taxable years beginning in 2015, the personal exemption phases out for taxpayers with the following adjusted gross income amounts:

Filing Status AGI – Beginning of Phaseout AGI – Completed Phaseout
Married Individuals Filing Joint Returns and Surviving Spouses (§ 1(a)) $309,900 $432,400
Heads of Households (§ 1(b)) $284,050 $406,550
Unmarried Individuals (other than Surviving Spouses and Heads of Households) (§ 1(c)) $258,250 $380,750
Married Individuals Filing Separate Returns (§ 1(d)) $154,950 $216,200

.25 Eligible Long-Term Care Premiums. For taxable years beginning in 2015, the limitations under § 213(d)(10), regarding eligible long-term care premiums includible in the term “medical care,” are as follows:

Attained Age Before the Close of the Taxable Year Limitation on Premiums
40 or less $380
More than 40 but not more than 50 $710
More than 50 but not more than 60 $1,430
More than 60 but not more than 70 $3,800
More than 70 $4,750

.26 Medical Savings Accounts.

(1) Self-only coverage. For taxable years beginning in 2015, the term “high deductible health plan” as defined in § 220(c)(2)(A) means, for self-only coverage, a health plan that has an annual deductible that is not less than $2,200 and not more than $3,300, and under which the annual out-of-pocket expenses required to be paid (other than for premiums) for covered benefits do not exceed $4,450.

(2) Family coverage. For taxable years beginning in 2015, the term “high deductible health plan” means, for family coverage, a health plan that has an annual deductible that is not less than $4,450 and not more than $6,650, and under which the annual out-of-pocket expenses required to be paid (other than for premiums) for covered benefits do not exceed $8,150.

.27 Interest on Education Loans. For taxable years beginning in 2015, the $2,500 maximum deduction for interest paid on qualified education loans under § 221 begins to phase out under § 221(b)(2)(B) for taxpayers with modified adjusted gross income in excess of $65,000 ($130,000 for joint returns), and is completely phased out for taxpayers with modified adjusted gross income of $80,000 or more ($160,000 or more for joint returns).

.28 Treatment of Dues Paid to Agricultural or Horticultural Organizations. For taxable years beginning in 2015, the limitation under § 512(d)(1), regarding the exemption of annual dues required to be paid by a member to an agricultural or horticultural organization, is $160.

.29 Insubstantial Benefit Limitations for Contributions Associated with Charitable Fund-Raising Campaigns.

(1) Low cost article. For taxable years beginning in 2015, for purposes of defining the term “unrelated trade or business” for certain exempt organizations under § 513(h)(2), “low cost articles” are articles costing $10.50 or less.

(2) Other insubstantial benefits. For taxable years beginning in 2015, under § 170, the $5, $25, and $50 guidelines in section 3 of Rev. Proc. 90–12, 1990–1 C.B. 471 (as amplified by Rev. Proc. 92–49, 1992–1 C.B. 987, and modified by Rev. Proc. 92–102, 1992–2 C.B. 579), for the value of insubstantial benefits that may be received by a donor in return for a contribution, without causing the contribution to fail to be fully deductible, are $10.50, $52.50, and $105, respectively.

.30 Expatriation to Avoid Tax. For calendar year 2015, under § 877A(g)(1)(A), unless an exception under § 877A(g)(1)(B) applies, an individual is a covered expatriate if the individual’s “average annual net income tax” under § 877(a)(2)(A) for the five taxable years ending before the expatriation date is more than $160,000.

.31 Tax Responsibilities of Expatriation. For taxable years beginning in 2015, the amount that would be includible in the gross income of a covered expatriate by reason of § 877A(a)(1) is reduced (but not below zero) by $690,000.

.32 Foreign Earned Income Exclusion. For taxable years beginning in 2015, the foreign earned income exclusion amount under § 911(b)(2)(D)(i) is $100,800.

.33 Unified Credit Against Estate Tax. For an estate of any decedent dying during calendar year 2015, the basic exclusion amount is $5,430,000 for determining the amount of the unified credit against estate tax under § 2010.

.34 Valuation of Qualified Real Property in Decedent’s Gross Estate. For an estate of a decedent dying in calendar year 2015, if the executor elects to use the special use valuation method under § 2032A for qualified real property, the aggregate decrease in the value of qualified real property resulting from electing to use § 2032A for purposes of the estate tax cannot exceed $1,100,000.

.35 Annual Exclusion for Gifts.

(1) For calendar year 2015, the first $14,000 of gifts to any person (other than gifts of future interests in property) are not included in the total amount of taxable gifts under § 2503 made during that year.

(2) For calendar year 2015, the first $147,000 of gifts to a spouse who is not a citizen of the United States (other than gifts of future interests in property) are not included in the total amount of taxable gifts under §§ 2503 and 2523(i)(2) made during that year.

.36 Tax on Arrow Shafts. For calendar year 2015, the tax imposed under § 4161(b)(2)(A) on the first sale by the manufacturer, producer, or importer of any shaft of a type used in the manufacture of certain arrows is $0.49 per shaft.

.37 Passenger Air Transportation Excise Tax. For calendar year 2015, the tax under § 4261(b)(1) on the amount paid for each domestic segment of taxable air transportation is $4. For calendar year 2015, the tax under § 4261(c)(1) on any amount paid (whether within or without the United States) for any international air transportation, if the transportation begins or ends in the United States, generally is $17.70. Under § 4261(c)(3), however, a lower amount applies under § 4261(c)(1) to a domestic segment beginning or ending in Alaska or Hawaii, and the tax applies only to departures. For calendar year 2015, the rate is $8.90.

.38 Reporting Exception for Certain Exempt Organizations with Nondeductible Lobbying Expenditures. For taxable years beginning in 2015, the annual per person, family, or entity dues limitation to qualify for the reporting exception under § 6033(e)(3) (and section 5.05 of Rev. Proc. 98–19, 1998–1 C.B. 547), regarding certain exempt organizations with nondeductible lobbying expenditures, is $111 or less.

.39 Notice of Large Gifts Received from Foreign Persons. For taxable years beginning in 2015, § 6039F authorizes the Treasury Department and the Internal Revenue Service to require recipients of gifts from certain foreign persons to report these gifts if the aggregate value of gifts received in the taxable year exceeds $15,601.

.40 Persons Against Whom a Federal Tax Lien Is Not Valid. For calendar year 2015, a federal tax lien is not valid against (1) certain purchasers under § 6323(b)(4) who purchased personal property in a casual sale for less than $1,520, or (2) a mechanic’s lienor under § 6323(b)(7) who repaired or improved certain residential property if the contract price with the owner is not more than $7,590.

.41 Property Exempt from Levy. For calendar year 2015, the value of property exempt from levy under § 6334(a)(2) (fuel, provisions, furniture, and other household personal effects, as well as arms for personal use, livestock, and poultry) cannot exceed $9,080. The value of property exempt from levy under § 6334(a)(3) (books and tools necessary for the trade, business, or profession of the taxpayer) cannot exceed $4,540.

.42 Interest on a Certain Portion of the Estate Tax Payable in Installments. For an estate of a decedent dying in calendar year 2015, the dollar amount used to determine the “2-percent portion” (for purposes of calculating interest under § 6601(j)) of the estate tax extended as provided in § 6166 is $1,470,000.

.43 Attorney Fee Awards. For fees incurred in calendar year 2015, the attorney fee award limitation under § 7430(c)(1)(B)(iii) is $200 per hour.

.44 Periodic Payments Received under Qualified Long-Term Care Insurance Contracts or under Certain Life Insurance Contracts. For calendar year 2015, the stated dollar amount of the per diem limitation under § 7702B(d)(4), regarding periodic payments received under a qualified long-term care insurance contract or periodic payments received under a life insurance contract that are treated as paid by reason of the death of a chronically ill individual, is $330.

SECTION 4. EFFECTIVE DATE

.01 General Rule. Except as provided in section 4.02, this revenue procedure applies to taxable years beginning in 2015.

.02 Calendar Year Rule. This revenue procedure applies to transactions or events occurring in calendar year 2015 for purposes of sections 3.08 (rehabilitation expenditures treated as separate new building), 3.09 (low-income housing credit), 3.13 (transportation mainline pipeline construction industry optional expense substantiation rules for payments to employees under accountable plans), 3.20 (private activity bonds volume cap), 3.21 (loan limits on agricultural bonds), 3.22 (general arbitrage rebate rules), 3.23 (safe harbor rules for broker commissions on guaranteed investment contracts or investments purchased for a yield restricted defeasance escrow), 3.30 (expatriation to avoid tax), 3.34 (valuation of qualified real property in decedent’s gross estate), 3.35 (annual exclusion for gifts), 3.36 (tax on arrow shafts), 3.37 (passenger air transportation excise tax), 3.40 (persons against whom a federal tax lien is not valid), 3.41 (property exempt from levy), 3.42 (interest on a certain portion of the estate tax payable in installments), 3.43 (attorney fee awards), and 3.44 (periodic payments received under qualified long-term care insurance contracts or under certain life insurance contracts).

SECTION 5. DRAFTING INFORMATION

The principal author of this revenue procedure is William Ruane of the Office of Associate Chief Counsel (Income Tax & Accounting). For further information regarding this revenue procedure, contact Mr. Ruane at (202) 317-4718 (not a toll-free number).


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