(a) Time of making elections—(1) In general. Any election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a) must be made on or before the later of—

(i) February 28, 1994; or

(ii) The due date (taking extensions into account) of the electing bank's original tax return for its disqualification year (as defined in §1.585-5(d)(1)) or, for elections under §1.585-6(d)(2), the year for which the election is made.

(2) No extension of time for payment. Payments of tax due must be made in accordance with chapter 62 of the Internal Revenue Code. However, if an election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a) is made or revoked on or before February 28, 1994 and the making or revoking of the election results in an underpayment of estimated tax (within the meaning of section 6655(a)) with respect to an installment of estimated tax due on or before the date the election was so made or revoked, no addition to tax will be imposed under section 6655(a) with respect to the amount of the underpayment attributable to the making or revoking of the election.

(b) Manner of making elections—(1) In general. Except as provided in paragraph (b)(2) of this section, an electing bank must make any election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a) by attaching a statement to its tax return (or amended return) for its disqualification year or, for elections under §1.585-6(d)(2), the year for which the election is made. This statement must contain the following information:

(i) The name, address and taxpayer identification number of the electing bank;

(ii) The nature of the election being made (i.e., whether the election is to include in income more than 10 percent of the bank's net section 481(a) adjustment under §1.585-6 (b)(2) or (d)(2) or to use the cut-off method under §1.585-7); and

(iii) If the election is under §1.585-6(b)(2) or (d)(2), the percentage being elected.

(2) Certain tax returns filed before December 29, 1993. A bank is deemed to have made an election under §1.585-6(b)(2) or (d)(2) if the bank evidences its intent to make an election under section 585(c)(3)(A)(iii)(I) or section 585(c)(3)(B)(ii) for its disqualification year (or, for elections under §1.585-6(d)(2), the election year), by designating a specific recapture amount on its tax return or amended return for that year (or attaching a statement in accordance with §301.9100-7T(a)(3)(i) of this chapter), and the return is filed before December 29, 1993. A bank is deemed to have made an election under §1.585-7(a) if the bank evidences its intent to make an election under section 585(c)(4) for its disqualification year by attaching a statement in accordance with §301.9100-7T(a)(3)(i) of this chapter to its tax return or amended return for that year, and the return is filed before December 29, 1993.

(c) Revocation of elections—(1) On or before final date for making election. An election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a) may be revoked without the consent of the Commissioner on or before the final date prescribed by paragraph (a)(1) of this section for making the election. To do so, the bank that made the election must file an amended tax return for its disqualification year (or, for elections under §1.585-6(d)(2), the year for which the election was made) and attach a statement that—

(i) Includes the bank's name, address and taxpayer identification number;

(ii) Identifies and withdraws the previous election; and

(iii) If the bank is making a new election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a), contains the information described in paragraphs (b)(1)(ii) and (b)(1)(iii) of this section.

(2) After final date for making election. An election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a) may be revoked only with the consent of the Commissioner after the final date prescribed by paragraph (a)(1) of this section for making the election. The Commissioner will grant this consent only in extraordinary circumstances.

(d) Elections by banks that are members of parent-subsidiary controlled groups. In the case of a bank that is a member of a parent-subsidiary controlled group (as defined in §1.585-5(d)(2)), any election under §1.585-6(b)(2), §1.585-6(d)(2) or §1.585-7(a) with respect to the bank is to be made separately by the bank. An election made by one member of such a group is not binding on any other member of the group.

(e) Elections made or revoked by amended return on or before February 28, 1994. This paragraph (e) applies to any election that a bank seeks to make under paragraph (b) of this section, or revoke under paragraph (c) of this section, by means of an amended return that is filed on or before February 28, 1994. To make or revoke an election to which this paragraph (e) applies, a bank must file (before expiration of each applicable period of limitations under section 6501) this amended return and amended returns for all taxable years after the taxable year for which the election is made or revoked by amended return, to any extent necessary to report the bank's tax liability in a manner consistent with the making or revoking of the election by amended return.

[T.D. 8513, 58 FR 68764, Dec. 29, 1993; 59 FR 4583, Feb. 1, 1994; 59 FR 15502, Apr. 1, 1994]