CCA 200850033: a business became a covered railroad employer on the day it first paid an employee

Plain-English summary

This is a one page memorandum from the Office of Chief Counsel, routed "CC:TEGE:EOEG:ET1" under control number "POSTN-130209-08", dated "date: September 05, 2008" and released 12/12/2008. It runs from the "from: Office of Division Counsel/Associate Chief Counsel" for "Tax Exempt & Government Entities" to the "to: Director, Submission Processing" in "Cincinnati, OH", marked "Attn: Entity Unit". The subject line is the whole topic: "subject: Railroad Retirement Tax Act Status".

The substance is two sentences. Under a standing arrangement, "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 became a covered employer under the Railroad Retirement Act and the Railroad Unemployment Insurance Act effective" a redacted date. Chief Counsel then agrees, under the tax statute rather than the benefits statutes, that the business "became a covered employer under the Railroad Retirement Tax Act effective" the same redacted date.

The memorandum states that the business became a covered employer effective "the date it first compensated an employee. Please take the appropriate action regarding this business." It supplies no other facts about the business and does not explain the legal basis for the date.

The memorandum does not define "covered employer" or cite a provision explaining the term. It records the effective date for this business and leaves the administrative action to Submission Processing.

The division of labour is stated openly rather than left to inference. Chief Counsel reviewed what the Board sent and nothing else: "We have reviewed the opinion of the RRB and, based upon the information submitted to us by the RRB, we also conclude that" the same result follows. The Board develops the facts and forms the opinion; Counsel checks it against the tax statute and signs; the Entity Unit is told to act. The closing instruction is purely administrative, and the memorandum is signed "Janine Cook" over a rule, with an empty "cc:" line beneath it.

Identifying material is overstruck with runs of hyphens. The business name, address, and effective date therefore appear as dash runs. In the second sentence, a dash run collides with the following word and leaves no space, giving "-became a covered employer under the Railroad Retirement Tax Act effective". The text preserves that spacing as released.

The memorandum carries no section 6110 disclosure paragraph, and the string 6110 does not appear in its text. It names the Railroad Retirement Act, the Railroad Unemployment Insurance Act, and the Railroad Retirement Tax Act, but no numeric Code section appears anywhere in the text.

The memorandum cites no case, regulation, or numbered Code provision.

Ruling snapshot

• Question: Did a business become a covered employer under the Railroad Retirement Tax Act, and from what date?
• Outcome: Advice given. Chief Counsel agreed with the Railroad Retirement Board that the business became a covered employer, effective the date it first compensated an employee, and told Submission Processing to take the appropriate action.
• Key authorities: The Railroad Retirement Tax Act, the Railroad Retirement Act and the Railroad Unemployment Insurance Act, each named by title only. No numeric Code section, regulation or case is cited anywhere in the document.

Full text (IRS public release)

```text
Office of Chief Counsel
Internal Revenue Service
Memorandum
Number: 200850033
Release Date: 12/12/2008
CC:TEGE:EOEG:ET1
POSTN-130209-08

UILC: 3231.01-00

date: September 05, 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 became a covered employer under the Railroad Retirement Act and
       the Railroad Unemployment Insurance Act effective --------------------------:

       -------------------------------------------
       -----------------------
       ---------------------------
       ---------------------------------

       We have reviewed the opinion of the RRB and, based upon the information submitted to
       us by the RRB, we also conclude that --------------------------------------------became a
       covered employer under the Railroad Retirement Tax Act effective --------------------------,
       the date it first compensated an employee. Please take the appropriate action
       regarding this business.


                                                     _____________________________
                                                             Janine Cook

       cc:

```