Ezel / IRS Rulings / 200909049

CCA 200909049: State-law manager status controls authority to bind an LLC

Number
200909049
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Tax Matters Partner
Topics
Procedure, penalties, and administration
Code sections
§ 6223
Ruling dated
December 9, 2008
Publicly released
February 27, 2009
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2009, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2009
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel distinguished eligibility to serve as an LLC's tax matters partner from authority to sign a contract for the LLC. The email says only a member-manager can be the tax matters partner. That status alone does not authorize the person to bind the LLC, however, unless the person is also a manager under state law. The advice therefore recommends using “manager” rather than “member-manager” when describing contract authority.

Ruling snapshot

  • Question: Does member-manager status by itself authorize a person to execute a contract for an LLC?
  • Outcome: Advice given: no, the person must be a manager under state law.
  • Key authorities: IRC § 6223.

Full text (IRS public release)

ID: CCA_2008120912220341 Number: 200909049
Release Date: 2/27/2009
Office: --------------
UILC: 6223.05-00

From: ------------------
Sent: Tuesday, December 09, 2008 12:22:07 PM
To: -----------------
Cc:
Subject: RE: IRM 8.19.1

Hi --------

I had to meet with my reviewer to discuss your first question. It is true that only a member-manager can be a TMP, but a member-manager does not have the authority to execute a contract on behalf of the LLC unless he/she is a "manager" under state law. Being a member-manager is irrelevant unless that person is a manager under state law. For this reason, "manager" should be used instead of "member-manager."

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Thank you,

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