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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Home-sale exclusion did not absorb suspended passive rental losses
A taxpayer used a home as a principal residence, converted it to a rental property, and accumulated suspended passive activity losses. The taxpayer then sold the entire rental activity to an…
School district received more time to spend bond proceeds
A public school district issued qualified school construction bonds to expand and rehabilitate a roughly 140-year-old school. Historic-district design changes, unexpectedly extensive fire damage, a…
Public authority received more time to spend school construction bond proceeds
A state instrumentality issued qualified school construction bonds for work at about 100 public schools. Contractor performance problems, contract disputes, project revisions, and delayed land-use…
Domestic corporate partners could claim energy credits for partnership solar projects in a U.S. possession
A domestic limited liability company planned to become a partnership owned by domestic corporations and to operate solar electricity projects in a U.S. possession. Property used predominantly…
Nonprofit home-financing LLC was excluded from taxable mortgage pool treatment
Two section 501(c)(3) organizations used a nonprofit limited liability company to finance home loans for low- and moderate-income borrowers in communities needing stabilization. The LLC proposed…
Joint nonprofit housing program's financing LLC avoided taxable mortgage pool status
Two section 501(c)(3) organizations formed a nonprofit limited liability company to issue multiple-maturity notes secured by home loans to low- and moderate-income borrowers. The loans supported…
Partnership and partners received 120 days for missed IDC elections
An oil and gas partnership's return preparer overlooked intangible drilling and development costs on the partnership's first return reporting those costs. The partnership therefore missed the…
Partnership and partners received 120 days for missed IDC elections
An oil and gas partnership's return preparer overlooked intangible drilling and development costs on the partnership's first return reporting those costs. The partnership therefore missed the…
Partnership and partners received 120 days for missed IDC elections
An oil and gas partnership's return preparer overlooked intangible drilling and development costs on the partnership's first return reporting those costs. The partnership therefore missed the…
Partnership and partners receive extensions for drilling-cost elections
An oil-producing limited liability company taxed as a partnership incurred intangible drilling and development costs for the first time. Its return preparer overlooked those costs, so the…
Late railroad track maintenance credit form treated as timely
The IRS granted a corporate taxpayer relief for a late Form 8900 claiming the railroad track maintenance credit. A tax-department restructuring caused the personnel responsible for IRC § 45G…
Additive-treated coal and pilot testing qualify for refined-coal credit
The IRS ruled that coal treated with chemical additives to reduce nitrogen oxide and mercury emissions constitutes refined coal under IRC § 45 when made from feedstock of the tested source or rank…
Additive-treated coal and pilot testing qualify for refined-coal credit
The IRS ruled that coal treated with chemical additives to reduce nitrogen oxide and mercury emissions constitutes refined coal under IRC § 45 when made from feedstock of the tested source or rank…
School construction bond spending period extended for site delays
A public authority issued qualified school construction bonds to finance a nonprofit borrower's school site and new facility. The project fell behind after a court-required location change and the…
Taxpayer receives 45 days for late real-property debt election
A partner in a shopping-center business was allocated cancellation-of-debt income after the partnership defaulted on a bank loan. The taxpayer's experienced return preparer failed to discuss or make…
Partner receives 45 days for late real-property debt election
A partner in a shopping-center limited liability company was allocated cancellation-of-debt income after the company defaulted on a bank loan. The taxpayer's experienced return preparer overlooked…
Shopping-center partner receives late debt-election relief
A partner in a limited liability company operating a shopping center was allocated cancellation-of-debt income after a loan default. The taxpayer's qualified return preparer failed to advise the…
Related-party share sale defers loss before liquidation
A consolidated corporate group proposed transferring most of a loss corporation's stock to a subsidiary, selling those shares to a related real estate investment trust for preferred stock, and later…
Higher reagent rate does not change the refined-coal process
A company operating a leased refined-coal facility asked whether increasing the amount of a chemical reagent applied per ton of coal would count as a change in its production process. The facility…
Sludge power plant components qualify for the energy credit
A company planned to build a power plant that would dry and burn sewage sludge to generate electricity for a water district. The plant would consist of a sludge bin, dryer, burner, and turbine…
Two historic buildings counted as one project for the rehabilitation credit
A developer was renovating two adjacent historic buildings as a mixed-use cultural and commercial development. One building had a disqualified lease to a tax-exempt tenant, so the developer asked…
Increasing a refined-coal reagent rate did not change the production process
A disregarded subsidiary leased and operated a facility that mixed coal with two chemical reagents to reduce nitrogen oxide and mercury emissions. Testing showed emission reductions above the…
Refined-coal process, testing, and facility changes received favorable rulings
A partnership operated two production lines that mixed coal blends with chemical additives to reduce nitrogen oxide and mercury emissions. The IRS ruled that the resulting product could constitute…
Refined-coal process, testing, and facility changes received favorable rulings
A partnership operated two production lines that mixed coal blends with chemical additives to reduce nitrogen oxide and mercury emissions. The IRS ruled that the resulting product could constitute…
Full ADIT rate-base reduction complied with utility normalization rules
A regulated natural-gas utility had net operating loss carryforwards and a minimum tax credit carryforward while maintaining an accumulated deferred income tax reserve for accelerated depreciation.…
Court-approved trust severance preserved GST exemption without gifts, estate inclusion, or gain
A pre-1985 irrevocable trust became the subject of fiduciary and beneficiary litigation over investments, management, and family-owned farmland corporations. A court-approved settlement proposed…
Global education program preserves exemption and avoids unrelated business income
A public charity operated educational programs focused on global business and leadership. It proposed replacing one program with a multi-country program managed by a foreign nonprofit controlled by…
Insurance-only funds avoid investor-control ownership
An investment adviser planned regulated investment company funds available only through insurance company separate accounts and other permitted holders. Each fund would invest in publicly available…
VEBA may provide limited health benefits to domestic partners
A tax-exempt voluntary employees' beneficiary association asked about health reimbursement arrangement benefits for employees' domestic partners. The IRS concluded that coverage for qualifying…
University youth programs treated as educational activities
A land-grant university asked whether its youth Club activities would be treated as part of the university’s educational operations and whether designated contributions could be deductible. The IRS…
Foreclosure qualifies as a fully taxable disposition of a passive activity
Chief Counsel advised that a foreclosure on real property securing recourse debt can be a fully taxable disposition of a taxpayer's entire passive activity. That conclusion applies even when…
Utility management agreement does not create private business use of bond-financed systems
A governmental authority asked whether an amended agreement for operating and maintaining electric transmission and distribution systems would create private business use of tax-exempt bond-financed…
Late election to pass through a rehabilitation credit is treated as timely
The IRS granted a limited liability company's request for more time to make an election that would treat its tenant as having acquired rehabilitated property for purposes of passing through an…
Securities-litigation settlement and related costs are deductible business expenses
The IRS ruled that a corporation may deduct liabilities paid to settle a securities lawsuit, including related legal fees and other expenses, as ordinary and necessary business expenses under IRC §…
FSA citations removed from revised Form 886A
Chief Counsel advised that Field Service Advice could not be cited as authority. After those citations were removed, the Form 886A had to be revised so the text made sense. Counsel recommended using…
IRS approves tax treatment of a retiree medical reimbursement plan
The IRS ruled that contributions to and coverage under a medical reimbursement plan, along with payments and reimbursements made by the plan, would be excluded from the gross income of eligible…
IRS grants extra time for a discharge-of-indebtedness tax election
The IRS considered an individual's late election to apply excluded cancellation-of-debt income first to the basis of depreciable rental property. The taxpayer's accountant reported the excluded…
Refined coal process qualifies for the section 45 credit under stated conditions
The IRS ruled on a partnership's plan to produce refined coal by mixing proprietary additives with feedstock coal before combustion. Testing showed reductions in nitrogen oxide and mercury…
Refined coal process qualifies for the section 45 credit under stated conditions
The IRS ruled on a taxpayer's plan to produce refined coal by mixing proprietary additives with feedstock coal before combustion. Testing showed reductions in nitrogen oxide and mercury emissions,…
Excise tax credits reduce the deductible excise tax liability
Chief Counsel advised that a claimant must apply excise tax credits under IRC § 6426(a) against fuel tax liabilities under §§ 4081 and 4041. To the extent the credits reduce those liabilities, they…
Construction support payments to retailers need not be capitalized
Chief Counsel Advice considers whether construction support payments made by a product manufacturer to its retailers must be capitalized under the intangible-asset rules. The retailers had to…
Call option treated as an acquisition of foreign subsidiary stock
The IRS ruled on the tax treatment of a staged acquisition involving a target entity, a call option, and foreign corporate subsidiaries. For purposes of the controlled-group rules, the call option…
Section 83(b) election remains valid despite a missing tax-return copy
The IRS ruled that a taxpayer's § 83(b) election for restricted stock remained valid even though a copy was not attached to the taxpayer's income tax return. The taxpayer had timely mailed the…
S corporation redemption qualifies for exchange treatment and installment reporting
The IRS ruled on a proposed transaction in which an S corporation would redeem all stock held by two retiring shareholders in exchange for promissory notes, then issue stock to four key employees.…
IRS classifies removable partitions as five-year property
A business planned to install two types of interior non-load-bearing drywall partitions in owned and leased buildings. The IRS treated the removable zip-type partitions as tangible personal property…
Community trust and nonprofit corporation treated as a single entity
An existing community trust asked whether it and a newly formed nonprofit corporation could be treated as one entity for federal tax purposes. The IRS found that the trust and corporation had a…
Taxpayer granted extra time to elect current deduction of drilling costs
The IRS granted a taxpayer 120 additional days to make an election under IRC § 263(c) to deduct intangible drilling and development costs. The taxpayer's disregarded LLC had incurred those costs,…
Tax treatment of government relocation payments
The IRS considered relocation payments made to a business displaced by a state agency's federally assisted eminent-domain project. The payments qualified for exclusion from gross income under the…
CCA 1352009: Credit consequences when nonprofit involvement in a housing project lapses
Chief Counsel analyzed the tax consequences when a low-income housing project no longer has the required qualified nonprofit organization involved throughout the compliance period. The advice…
PLR 1352006: exclusion for accidental disability and death benefits
The ruling addresses five public employee pension plans that provide accidental disability retirement allowances and accidental death benefits. The IRS concluded that the plans' governing statutes…
Solar equipment sale-leaseback may be financing
This advice addresses a proposed transaction in which a taxpayer would buy solar energy equipment and lease it back to the seller. The IRS says the arrangement could be recharacterized as financing…
PLR 1351020: bank may claim losses when it surrenders bank-owned life insurance policies
A national banking association asked how to calculate losses when it surrendered three bank-owned life insurance policies and terminated related stable-value wrap contracts. The IRS ruled that the…
CCA 1350037: dependent group-term life insurance exceeding $2,000 is not a de minimis fringe benefit
Chief Counsel Advice addresses employer-provided dependent group-term life insurance. The advice concludes that coverage with a face amount exceeding $2,000 is not a de minimis fringe benefit. In…
PLR 1350032: association life insurance programs are separate from the employer's basic coverage
The ruling addresses an employer whose employees and retirees could buy supplemental group-term life insurance through an employee association. The IRS concludes that the association's policies may…
CCA 1350031: IRS unable to rule on captive insurer status and premium deductions
Chief Counsel addresses a foreign insurance company that elected to be taxed as a domestic corporation and sought rulings about a reinsurance pool and premiums paid by affiliated companies. The…
CCA 1350030: IRS unable to rule on captive insurer status and premium deductions
Chief Counsel addresses a foreign insurance company that elected to be taxed as a domestic corporation and sought rulings about a reinsurance pool and premiums paid by an affiliated company. The…
CCA 1350029: IRS unable to rule on captive insurer status and premium deductions
Chief Counsel addresses a foreign insurance company that elected to be taxed as a domestic corporation and sought rulings about a reinsurance pool and premiums paid by affiliated companies. The…
CCA 1350028: IRS unable to rule on captive insurer status and premium deductions
Chief Counsel addresses a foreign insurance company that elected to be taxed as a domestic corporation and sought rulings about a reinsurance pool and premiums paid by an affiliated company. The…
CCA 1350027: IRS unable to rule on captive insurer status and premium deductions
Chief Counsel addresses a foreign insurance company that elected to be taxed as a domestic corporation and sought rulings about a reinsurance pool and premiums paid by affiliated companies. The…
CCA 1350026: IRS unable to rule on captive insurer status and premium deductions
Chief Counsel addresses a foreign insurance company that elected to be taxed as a domestic corporation and sought rulings about a reinsurance pool and premiums paid by an affiliated company. The…
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.