[Code of Federal Regulations]
[Title 26, Volume 17]
[Revised as of April 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR54.4975-1]

[Page 257]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 54_PENSION EXCISE TAXES--Table of Contents
 
Sec. 54.4975-1  General rules relating to excise tax on prohibited 
transactions.

    (a) Scope. This section provides general rules for the imposition of 
the excise taxes on prohibited transactions.
    (b) Initial tax. Section 4975(a) imposes an initial tax on each 
prohibited transaction. The initial tax is 5 percent of the amount 
involved with respect to the prohibited transaction for each year (or 
part thereof) in the taxable period.
    (c) Additional tax. Section 4975(b) imposes an excise tax in any 
case in which an initial tax is imposed under section 4975(a) on a 
prohibited transaction and the prohibited transaction is not corrected 
within the taxable period (as defined in paragraph (d) of this section). 
The additional tax is 100 percent of the amount involved with respect to 
the prohibited transaction.
    (d) Taxable period--(1) In general. For purposes of any prohibited 
transaction, the term ``taxable period'' means the period beginning with 
the date on which the prohibited transaction occurs and ending on the 
earliest of:
    (i) The date of mailing of a notice of deficiency under section 6212 
with respect to the tax imposed by section 4975(a);
    (ii) The date on which correction of the prohibited transaction is 
completed; or
    (iii) The date on which the tax imposed by section 4975(a) is 
assessed.
    (2) Special rule. Where a notice of deficiency referred to in 
paragraph (d)(1)(i) of this section is not mailed because a waiver of 
the restrictions on assessment and collection of a deficiency has been 
accepted or because the deficiency is paid, the date of filing of the 
waiver or the date of such payment, respectively, shall be treated as 
the end of the taxable period.

[T.D. 8084, 51 FR 16305, May 2, 1986]