CCA 200822024: Corporate merger ends railroad employer status

Plain-English summary

The Railroad Retirement Board concluded that a redacted business stopped being a covered employer under the railroad retirement and unemployment insurance laws. IRS counsel reviewed the Board's opinion and agreed that the business ceased to be a covered employer under the Railroad Retirement Tax Act no later than a redacted date. The business had lost its separate legal existence in a corporate merger. Counsel believed the entity receiving the merged business was already a covered employer under the Railroad Retirement Act, although the Board's opinion did not address that point. The memo directed the IRS processing unit to take appropriate action.

Ruling snapshot

• Question: Did the merged business remain a covered employer under the Railroad Retirement Tax Act?
• Outcome: Advice given: covered employer status ended no later than a redacted date after the merger.
• Key authorities: Railroad Retirement Tax Act; Railroad Retirement Act; Railroad Unemployment Insurance Act.

Full text (IRS public release)

Office of Chief Counsel

Memorandum
Internal Revenue Service

Number: 200822024
Release Date: 5/30/2008
CC:TEGE:EOEG:ET1
POSTN-155893-07

UILC: 3231.01-00

date: February 26, 2008
to: Director, Submission Processing
Cincinnati, OH
Attn: Entity Unit

from: Office of Division Counsel/Associate Chief Counsel Tax Exempt & Government Entities

subject: Railroad Retirement Tax Act Status

In accordance with the coordination procedure established between the Service and the Railroad Retirement Board (RRB), the RRB has provided us with its opinion that the following business ceased to be a covered employer under the Railroad Retirement Act and the Railroad Unemployment Insurance Act as of---------------------------:

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We have reviewed the opinion of the RRB and, based upon the information submitted to us by the RRB, we also conclude that the ------------------------------------------------------------- ceased to a covered employer under the Railroad Retirement Tax Act no later than ------ --------------------------, because the company had lost its status as a legal entity as a result of corporate merger. While the RRB opinion does not address the matter, we believe the entity into which ------- merged was already an employer under the Railroad Retirement Act.

POSTN-155893-07
2

Please take the appropriate action regarding this business.

_____
Janine Cook

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