IRS Written Determinations
Free IRS private letter rulings, technical advice memoranda, and Chief Counsel advice with plain-English summaries and the official IRS release on every page.
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Partnership received 120 days to make a late section 754 election
A limited liability company treated as a partnership missed a section 754 election after an owner died because its advisor did not explain that the election was available. The IRS found that the…
Estate received 120 days for a reverse QTIP election and trust severance
An estate made a QTIP election for a marital trust, but its accountant failed to attach Schedule R, advise the executor to divide the trust into GST-exempt and nonexempt shares, or make a reverse…
Taxpayer received 120 days to opt out of automatic GST allocations
A taxpayer created two irrevocable annuity trusts before the automatic generation-skipping transfer tax allocation rules were enacted. The trusts' estate tax inclusion periods ended after those…
Taxpayer received 120 days to opt out of automatic GST allocations
A taxpayer created two irrevocable annuity trusts before the automatic generation-skipping transfer tax allocation rules were enacted. The trusts' estate tax inclusion periods ended after those…
Foreign entity received 120 days for a late disregarded-entity election
A wholly owned foreign eligible entity intended to be classified as disregarded for federal tax purposes but inadvertently failed to file Form 8832 on time. The IRS found that the…
LLC received 120 days to correct a mistaken corporate election
A domestic single-member limited liability company intended to be disregarded for federal tax purposes and filed returns consistently with that treatment. It mistakenly submitted Form 8832 electing…
Nuclear decommissioning fund transfer qualified for tax-free treatment
A seller agreed to transfer a nuclear generating unit and its qualified and nonqualified decommissioning fund assets to a buyer that would assume the decommissioning liabilities. The IRS ruled that…
S corporation and QSub received inadvertent-termination relief
A trust became an ineligible S corporation shareholder after its temporary eligibility expired because its trustees failed to make a timely electing small business trust election. That failure…
Foundation could pay its founder's entity for charitable services
A private foundation proposed paying an entity owned by its founder for professional grant-making, program, charitable consulting, and investment services. Because the founder was a substantial…
Founder-owned entity could receive fees for foundation services
A private foundation proposed paying an entity owned by its founder for professional grant-making, program, charitable consulting, and investment services. Because the founder was a substantial…
Corporation received 60 days to make a late IC-DISC election
A domestic corporation was formed to operate as an interest charge domestic international sales corporation and sell its parent's products to foreign buyers on a commission basis. Its accounting…
Entity received 120 days for a late corporate classification election
An eligible entity intended to be classified as an association taxable as a corporation but inadvertently failed to file Form 8832 on time. It represented that its federal returns were consistent…
IRS approved a private foundation's scholarship procedures
A private foundation proposed scholarships for undergraduate and graduate students studying in two specified fields at accredited universities. An independent scholarship administrator would handle…
IRS approved four-year scholarships for graduating seniors
A private foundation proposed four-year undergraduate scholarships for graduating seniors from qualifying high schools in two regions. School representatives would nominate candidates, and a…
IRS approved annual nursing scholarships based on merit and need
A private foundation proposed annual scholarships for full-time students in specified nursing programs at a college. Applicants needed a minimum 3.5 grade point average and demonstrated financial…
Member benefit fund denied Section 501(c)(3) exemption
A membership corporation sought Section 501(c)(3) status for a fund that provided financial or material assistance to members facing serious injury, illness, medical emergencies, terminal illness,…
Surviving spouse could roll estate-beneficiary plan assets into an IRA
A participant in a governmental section 457(b) plan named his estate, rather than his spouse, as the beneficiary of his account. His surviving spouse was both the executrix and sole beneficiary of…
Foreign entity received 120 days for a late partnership election
A foreign eligible entity intended to be classified as a partnership for federal tax purposes but failed to file Form 8832 on time. It represented that the failure was not motivated by tax avoidance…
Corporation received relief for an ineffective S election
A corporation's S election was ineffective from its intended start date because a shareholder trust failed to make an electing small business trust election. The corporation represented that the…
Foreign entity received 120 days for a late disregarded-entity election
A foreign single-owner eligible entity intended to be disregarded for federal tax purposes from its formation date but failed to file Form 8832 on time. The IRS concluded that the…
S election relief covered an ineligible owner and second stock class
An entity intended to be an S corporation, but a partnership shareholder was ineligible and did not consent to the election. Its governing agreements also used partnership-style capital accounts and…
Deemed royalty excluded after intangible returned to U.S. group
A U.S. consolidated group had previously transferred intangible property abroad in a section 368 reorganization, creating annual deemed royalty income under section 367(d). It proposed moving the…
Community foundation and corporation could file one Form 990
A community foundation organized as a trust was the sole member and original funder of a supporting nonprofit corporation. The organizations proposed amendments placing all gifts under common…
Community foundation and corporation could file one Form 990
A community foundation organized as a trust was the sole member and original funder of a supporting nonprofit corporation. The organizations proposed amendments placing all gifts under common…
GST allocation substantially complied despite missing notice
A taxpayer transferred property to an irrevocable trust with generation-skipping transfer tax potential. The taxpayer timely filed Form 709, elected out of automatic GST exemption allocation, and…
IRS approved community and employer-related scholarships
A private foundation proposed one scholarship program for graduates of a local school system and another for children of employees of two companies. Separate advisory committees would evaluate…
Charitable remainder unitrust denied Section 501(c)(3) exemption
A charitable remainder unitrust applied for separate exemption under Section 501(c)(3). During the settlor's and spouse's lifetimes, the trust was required to make annual payments to them, with the…
Supplement filing year controlled the penalty amount
This brief Chief Counsel email addressed a supplement that was due in one year and filed the next year. It advised that the failure to file occurred in the due year, and that year determined the…
Retirement plan contribution required an actual outlay of assets
Chief Counsel explained when an employer has actually paid a contribution to a qualified retirement plan trust for a section 404(a) deduction. Under the objective outlay-of-assets test from Don E.…
Unequal liquidation rights received inadvertent S election relief
A corporation had voting and nonvoting shares that originally carried identical economic rights. Before its S election, an articles amendment changed the liquidation rights so the nonvoting shares…
Business separation qualified as a tax-free spin-off
A corporate group proposed separating one of its two longstanding businesses into a newly formed controlled corporation. The parent would contribute the separated business's assets and liabilities…
Tax-exempt controlled entity received 45 days for a late election
A private foundation wholly owned a taxable corporation that managed a partnership rehabilitating a historic building. Because the foundation owned more than half of the corporation, the corporation…
Taxpayer received 60 days for a late success-fee safe harbor
A taxpayer paid two advisers success-based fees in connection with the sale of all its ownership interests. Its return preparer deducted 70 percent of the fees under the Revenue Procedure 2011-29…
S corporation received passive-income termination relief
An S corporation had accumulated earnings and profits from C corporation years and received more than 25 percent of its gross receipts from passive investment income for three consecutive years.…
Surviving spouse could roll retitled inherited IRA into her own IRA
A decedent's IRA originally named another beneficiary, but the custodian retitled the account under a state court order to name the surviving spouse as sole beneficiary. The spouse had an unlimited…
Foreign merger stock exchange received section 367 exception
A U.S. corporate group agreed to exchange stock of a domestic subsidiary for common and preferred shares of a publicly traded foreign corporation in a two-step forward triangular merger. The foreign…
Pension surplus transfer avoided employer reversion tax
An employer terminated a frozen defined benefit plan that unexpectedly had surplus assets after all liabilities were satisfied. It proposed transferring the entire surplus directly to separate…
Taxpayer received 60 days to file a duplicate Form 3115
A consolidated group timely filed its return with the original Form 3115 for an automatic accounting-method change involving prepaid liabilities under the 12-month rule. Its accounting firm failed…
Acquirer received 60 days for a late success-fee safe harbor
A taxpayer paid investment bankers contingent fees for helping it acquire an ownership interest in another business. Its timely return deducted 70 percent of the fees and capitalized 30 percent…
IRS approved scholarships for math, science, and education students
A private foundation proposed renewable scholarships for students from a specified area who would attend college in a specified state and pursue mathematics, science, or education degrees.…
Coffeehouse denied section 501(c)(3) status because of its commercial operation
An organization planned to operate a coffeehouse during normal commercial hours, charge prices generally matching nearby competitors, employ paid staff, and use common business advertising. It also…
Two foreign entities received 120 days to make late disregarded-entity elections
A domestic limited partnership formed two foreign limited liability companies in a tiered ownership structure. The two foreign entities intended to be disregarded for federal tax purposes from their…
Surviving spouse may roll inherited IRA proceeds into her own IRAs
A decedent's children were originally named as the sole beneficiaries of his IRA, but a state court later named his surviving spouse as the sole beneficiary. The spouse represented that she had an…
Parties received more time to complete a section 336(e) election
Purchasers acquired more than 80 percent of an S corporation's stock in a transaction represented to be a qualified stock disposition. The parties intended to elect under section 336(e) to treat the…
Regulated investment company may revoke its section 4982 election
A regulated investment company had elected to use its calendar taxable year instead of the one-year period ending October 31 when computing capital gain net income for the section 4982 excise tax.…
Six investment-fund series received late corporate classification relief
Six series of business trusts intended from formation to be treated as corporations and regulated investment companies. Each had filed Form 1120-RIC and operated consistently with that intended…
Partnership received late section 754 election relief after partner deaths
A limited partnership failed to make a timely section 754 election for three years in which deaths affected partnership interests. It represented that it acted reasonably and in good faith and that…
Modified ruling preserves S status after a missed ESBT election
Shareholders transferred S corporation stock to an irrevocable trust that was eligible to be an electing small business trust, but the trustee did not timely make the ESBT election. The missed…
Private-school scholarship procedures approved under section 4945(g)
A private foundation proposed scholarships for academically qualified students with financial need to attend accredited private schools in grades PK through 12. An independent committee would…
Exempt status revoked after organization failed to produce records
The IRS selected a section 501(c)(3) organization for examination to verify that its activities remained consistent with its exempt status. The organization did not provide requested records…
Hospital district retained exemption and was reclassified as a governmental public charity
A hospital district had stopped directly operating a hospital after selling operating assets to a limited liability company and entering lease arrangements. The governing agreements reserved board…
Charity reclassified after support shifted from fees to public contributions
A charity had originally been classified under section 509(a)(2) because fees were its primary source of support. Its support later shifted to gifts, grants, and contributions, and its reported…
Social club exemption revoked for excessive nonmember investment income
A social club recognized under section 501(c)(7) reported that substantially all of its income for two examined years came from investments. Social clubs may generally receive no more than 35…
Motorboat racing organization lost exemption for recreational and private purposes
A motorboat racing organization claimed exemption for fostering national or international amateur sports competition. Its articles permitted any lawful purpose and lacked a qualifying dissolution…
Condominium association denied section 501(c)(4) status
A condominium association collected owner assessments to pay for utilities, insurance, landscaping, parking, roofing, pest treatment, and other common-property expenses. Membership and voting rights…
Business-park association denied section 501(c)(4) status
An association managed the common areas, design rules, construction review, and owner assessments for a privately owned commercial business park. Its members were the property owners, and a…
Homeowners association denied section 501(c)(3) status
A small homeowners association collected monthly fees from four members and used the pooled funds for property insurance and gardening. Its submitted articles bore a different name, did not…
Each taxpayer must sign Form 921-I to extend the assessment period
Chief Counsel advised how taxpayers should execute Form 921-I when a flow-through entity extends the assessment period for each owner’s share of common-improvement costs. The basic Form 921 applies…
Third party must use the statutory lien-discharge remedy
Chief Counsel advised that a third party paying another person’s tax liability must use the remedies under sections 6325(b)(4) and 7426(a)(4). Those provisions superseded the refund-suit route…
Dragnet clause does not defeat purchase-money mortgage priority
Chief Counsel considered whether a cross-collateralization, or dragnet, clause prevents a deed of trust from qualifying as a purchase-money mortgage for federal tax lien purposes. The advice found…
What these documents are
- Private letter rulings (PLRs): A taxpayer asked the IRS to rule on a planned transaction before doing it. The ruling shows exactly how the IRS applied the Code to those facts.
- Technical advice memoranda (TAMs): The IRS National Office answering a question raised during an audit or other proceeding.
- Chief Counsel advice (CCAs): IRS lawyers advising their own field staff on how to apply the law.
- Determination letters: Rulings on exempt-organization matters, such as whether an organization qualifies under § 501(c)(3) or a foundation's grant procedures pass § 4945.
- Not precedent, still useful: Under 26 U.S.C. § 6110(k)(3) none of these can be cited as precedent. They remain the best public window into how the IRS actually rules on facts like yours, and practitioners read them for exactly that.