PLR 200352009: IRS declines to rule because automatic depreciation election relief applies

Plain-English summary

Two subsidiaries asked for extra time to elect out of the mid-quarter depreciation convention for property placed in service in the taxable year that included September 11, 2001. The IRS said their request appeared to fall under Notice 2003-45, which already gave qualifying taxpayers an automatic extension through December 31, 2003, to amend returns and make the election. Because that notice addressed the request, the IRS declined to issue a ruling and said it would refund the user fees. The letter did not separately determine whether the subsidiaries met every condition of the notice.

Ruling snapshot

• Question: Was discretionary relief needed for the late depreciation convention election?
• Outcome: No ruling issued; the IRS pointed to automatic relief under Notice 2003-45.
• Key authorities: Notice 2001-70; Notice 2001-74; Notice 2003-45; Treas. Reg. § 301.9100-3.

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury

Number: 200352009
Washington, DC 20224
Release Date: 12/26/2003
Index Number: 9100.04-00 Person to Contact:

Telephone Number:

Refer Reply To:
CC:PSI:6-PLR-159508-02
Date:
September 15, 2003

Re: Request for an Extension of Time to Make a Regulatory Election

Parent =
Subsidiary 1 =

Subsidiary 2 =
x
=

Dear
:

This letter responds to a letter submitted by Parent on behalf of Subsidiary 1 and Subsidiary 2 (hereinafter, Subsidiary 1 and Subsidiary 2 are collectively referred to as “Taxpayer”), dated x, requesting a letter ruling under § 301.9100-3 of the Procedure and Administration Regulations to extend the time to make the election provided under Notice 2001-70, 2001-2 C.B. 437, not to apply the mid-quarter depreciation convention rules to property placed in service in the taxable year that included September 11, 2001.

As discussed during a telephone conversation with of our office on July 23, 2003, we believe that Taxpayer’s request falls under Notice 2003-45, 2003-29 I.R.B. 86. Notice 2003-45 amplifies Notice 2001-70 and Notice 2001-74, 2001-2 C.B. 551, by providing that a taxpayer qualifying under either notice who filed a timely federal tax return for the taxable year that includes September 11, 2001, but failed to make the election provided under Notice 2001-70 or Notice 2001-74, is granted an automatic extension until December 31, 2003, to amend its federal tax return for the taxable year that includes September 11, 2001, and any subsequent taxable years, in order to make the election under Notice 2001-70 or Notice 2001-74 and reflect any necessary adjustments resulting from the election. Based solely on the information provided in Taxpayer’s request, we believe that this request falls under Notice 2003-45.

2
PLR-159508-02

Accordingly, we will not rule on Taxpayer’s request.

We have attached a copy of Notice 2003-45. We are taking steps to refund Taxpayer’s user fees and they will be returned under separate cover.

We are sending a copy of this letter to the appropriate Internal Revenue Service official in the operating division that has examination jurisdiction of Parent’s federal tax returns. If you have any questions regarding this matter, contact
at
.

Sincerely yours,

KATHLEEN REED
Senior Technician Reviewer, Branch 6
Office of Associate Chief Counsel
(Passthroughs and Special Industries)

Attachment (1) copy of Notice 2003-45