[Code of Federal Regulations]
[Title 26, Volume 6]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.455-6]

[Page 153-154]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.455-6  Time and manner of making election.

    (a) Election without consent. (1) A taxpayer may, without consent, 
elect to treat prepaid subscription income of a trade or business under 
section 455 for the first taxable year--
    (i) Which begins after December 31, 1957, and
    (ii) In which there is received prepaid subscription income from the 
trade or business for which the election is made. Such an election shall 
be made not later than the time prescribed by law for filing the income 
tax return for such year (including extensions thereof), and shall be 
made by means of a statement attached to such return.
    (2) The statement shall indicate that the taxpayer is electing to 
apply the provisions of section 455 to his trade or business, and shall 
contain the following information:
    (i) The name and a description of the taxpayer's trade or business 
to which the election is to apply;
    (ii) The method of accounting used in such trade or business;
    (iii) The total amount of prepaid subscription income from such 
trade or business for the taxable year;
    (iv) The period or periods over which the liability of the taxpayer 
to furnish or deliver a newspaper, magazine, or other periodical 
extends;
    (v) The amount of prepaid subscription income applicable to each 
such period; and
    (vi) A description of the method used in allocating the prepaid 
subscription income to each such period.

In any case in which prepaid subscription income is received from more 
than one trade or business, the statement shall set forth the required 
information with respect to each trade or business subject to the 
election.
    (3) See paragraph (c) of this section for additional information 
required to be submitted with the statement if the taxpayer also elects 
to include in gross income for the taxable year of receipt the entire 
amount of prepaid subscription income attributable to a liability which 
is to end within 12 months after the date of receipt.
    (b) Election with consent. A taxpayer may, with the consent of the 
Commissioner, elect at any time to apply the provisions of section 455 
to any trade or business in which it receives prepaid subscription 
income. The request for such consent shall be in writing, signed by the 
taxpayer or its authorized representative, and shall be addressed to the 
Commissioner of Internal Revenue, Attention: T:R:C, Washington, D.C. 
20224. The request must be filed on or before the later of the following 
dates:
    (1) 90 days after the beginning of the first taxable year to which 
the election is to apply or

[[Page 154]]

    (2) May 28, 1962, and must contain the information described in 
paragraph (a)(2) of this section.

See paragraph (c) of this section for additional information required to 
be submitted with the request if the taxpayer also elects to include in 
gross income for the taxable year of receipt the entire amount of 
prepaid subscription income attributable to a liability which is to end 
within 12 months after the date of receipt.
    (c) ``Within 12 months'' election. (1) A taxpayer who elects to 
apply the provisions of section 455 to any trade or business may also 
elect to include in gross income for the taxable year of receipt (as 
described in section 455(d)(3) and paragraph (c) of Sec. 1.455-5) the 
entire amount of any prepaid subscription income from such trade or 
business if the liability from which it arose is to end within 12 months 
after the date of receipt. Any such election is binding for the first 
taxable year for which it is effective and for all subsequent taxable 
years, unless the taxpayer secures permission from the Commissioner to 
treat such income differently. Application to revoke or change a 
``within 12 months'' election shall be made in accordance with the 
provisions of section 446(e) and the regulations thereunder.
    (2) The ``within 12 months'' election shall be made by including in 
the statement required by paragraph (a) of this section or the request 
described in paragraph (b) of this section, whichever is applicable, a 
declaration that the taxpayer elects to include such income in gross 
income in the taxable year of receipt, and the amount of such income. If 
the taxpayer is engaged in more than one trade or business for which the 
election under section 455 is made, it must include, in such statement 
or request, a declaration for each trade or business for which it makes 
the ``within 12 months'' election. See also paragraph (e) of Sec. 
1.455-2.
    (3) If the taxpayer does not make the ``within 12 months'' election 
for its trade or business at the time prescribed for making the election 
to include prepaid subscription income in gross income for the taxable 
years during which its liability to furnish or deliver a newspaper, 
magazine, or other periodical exists for such trade or business, but 
later wishes to make such election, it must apply for permission from 
the Commissioner. Such application shall be made in accordance with the 
provisions of section 446(e) and the regulations thereunder.

[T.D. 6591, 27 FR 1799, Feb. 27, 1962]