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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UPS delivery does not satisfy notice-of-sale rules
A notice of nonjudicial sale was sent by UPS to the mailroom at the IRS address listed in Publication 4235. Chief Counsel concluded that this delivery did not satisfy IRC § 7425(c), which requires wri…
Vested pension rights can be levied before payout
Chief Counsel addressed a field question about levying a taxpayer’s pension-plan interest before the taxpayer had requested a distribution and before any proceeds existed. The advice states that the I…
Lawyer-regulation office cannot receive return information
Chief Counsel advised that IRS personnel could not disclose a taxpayer’s return information to a state lawyer-regulation office without the taxpayer’s consent. Section 6103 permits some disclosures to…
Untimely Form 1139 does not preserve a refund claim
A taxpayer filed a second Form 1139 more than one year after the close of the loss year. Chief Counsel concluded that the application was untimely under section 6411 and could not be treated as an inf…
Online software access fails the comparable exception
Chief Counsel reviewed the section 199 regulation file while developing the primary position for an online-software taxpayer. The email states that the regulatory history offered no additional insight…
Foreign entity receives 120 days for late disregarded status
A foreign entity and its owner intended from formation to treat the entity as disregarded for U.S. federal tax purposes. The owner consistently filed returns on that basis, but the entity had not been…
Revised nuclear decommissioning schedule is approved
A utility with a direct ownership interest in a permanently retired nuclear plant requested a revised schedule of ruling amounts for its qualified nuclear decommissioning fund. Its proposed schedule u…
Network-produced game broadcasts generate non-DPGR receipts
A professional sports team received a share of fees paid under league contracts that pooled and licensed the teams’ national television rights. The network had to create the finished live game broadca…
Prompt paper filing preserves a rejected e-filed return
A corporation electronically transmitted an amended return before the assessment period expired, but the IRS system rejected it because that tax year was no longer accepted electronically. The taxpaye…
Perjury jurat controls validity of false OID returns
A taxpayer filed returns reporting false original-issue-discount income and withholding and sought fraudulent refunds. Paper submissions on which the taxpayer crossed out the declaration under penalti…
Multiple trust defects receive S corporation relief
An S corporation discovered several defects involving its trust shareholders and original election. One trust missed its ESBT election, another omitted potential beneficiaries and later had a nonresid…
Loss corporation gets 60 days for a late closing election
A loss corporation experienced a section 382 ownership change but did not timely elect to close its books on the change date. It represented that the assessment period remained open and that it was no…
Built-in-loss transfer gets 60 days for a late basis election
A partnership owned a controlled foreign corporation that transferred built-in-loss property to a newly formed corporate subsidiary in a purported section 351 exchange. Section 362(e)(2) would ordinar…
Preferred units receive inadvertent S termination relief
An LLC taxed as an S corporation amended its operating agreement to give Class A units a preferential distribution right while Class B units shared only after that preference. Because the governing pr…
Foreign entity receives 120 days for partnership status
A foreign entity with two owners intended from formation to be treated as a partnership for U.S. federal tax purposes. Its U.S. owner consistently filed returns on that basis, but the entity had not b…
County deferred compensation plan qualifies under section 457
A county adopted a nonqualified deferred compensation plan and related trust for its employees. The plan required advance deferral elections, applied the statutory annual and catch-up limits, restrict…
Foreign entity receives 120 days for late disregarded status
A foreign entity and its sole owner intended from formation to treat the entity as disregarded for U.S. federal tax purposes. The owner consistently filed returns on that basis, but the entity had not…
Foreign entity gets late disregarded status before partnership
A foreign entity was wholly owned by one owner from formation and was intended to be disregarded for U.S. federal tax purposes. A second owner later acquired an interest, after which the owners treate…
Indirectly owned foreign entity gets late disregarded status
A foreign entity was owned by a foreign disregarded entity and indirectly by a U.S. corporation. The owners intended from formation to treat the lower-tier entity as disregarded, and U.S. returns cons…
Foreign entity receives 120 days for partnership status
A foreign entity with two owners intended from formation to be treated as a partnership for U.S. federal tax purposes. The owners consistently filed returns on that basis, but the entity had not been …
Acquisition-fee safe harbor statement may be filed late
A taxpayer incurred success-based fees in a covered business acquisition and intended to use the Rev. Proc. 2011-29 safe harbor. Its timely return followed the required economics by deducting 70 perce…
Multiple acquisition-fee elections may be filed late
A taxpayer incurred success-based fees in several covered business acquisitions and intended to use the Rev. Proc. 2011-29 safe harbor for all of them. Its timely return followed the required economic…
Missed ESBT and QSST elections receive S corporation relief
An S corporation’s grantor-trust shareholder ceased to qualify after the grantor died, but the trustee did not timely elect ESBT status. Shares were later transferred to individuals and two trusts who…
Integrated fracking-water services produce qualifying income
A publicly traded partnership planned to acquire a business that supplied water for hydraulic fracturing and handled the resulting waste fluids. The operations used specialized equipment and personnel…
Supplier settlement is cooperative patronage income
A grocery-distribution cooperative settled litigation over alleged overcharges on products it had bought for resale to its member stores. The IRS concluded that the settlement arose directly from the …
Bad advice and cancer treatment justify rollover waivers
Two taxpayers missed the 60-day IRA rollover deadline. One relied on a financial adviser who incorrectly said the rollover period was 90 days and redeposited the distribution after 81 days. The other …
Healthcare graduate scholarship procedures are approved
A private foundation proposed up to three annual scholarships for students within two semesters of completing graduate study in a healthcare-related field at selected universities. Selection criteria …
Arts organization loses exemption for operating a commercial rental business
An arts organization was recognized as tax-exempt based on plans to present free public arts events and provide stage-crew training and work to economically disadvantaged people. During examination, t…
Bingo operator is removed from a charitable group exemption
A subordinate organization was recognized under a group exemption based on plans to educate young people about drug and substance abuse. During examination, the IRS found that it operated bingo four d…
Housing organization loses exemption for inurement and noncharitable lodging operations
An organization claimed to provide temporary low-income and student housing. The IRS found that ownership of one property was transferred as a gift to an individual and that an officer used a resident…
Organization loses exemption for concealing an accounting business and paying private expenses
An organization was recognized as exempt based on plans to conduct social research and provide marriage counseling, lectures, seminars, workshops, and retreats. The IRS found that its creator, a certi…
Veterans organization loses exemption over unsupported gift-in-kind activities
A veterans organization was recognized as exempt based on plans to provide training, job-placement help, and related support. Its return later described assistance to disabled and homeless veterans, i…
Social club loses exemption after recurring public-use income exceeds 15 percent
A social and recreational club regularly opened its dance and bowling activities to nonmembers, who could enter through an unlocked gate and pay a nonmember fee at the counter. Its nonmember receipts …
Weekly campus market is an unrelated business and vendor fees are not rent
An alumni-support organization operated a public market every weekend on a community college’s parking lots and derived substantially all of its revenue from vendor fees. The organization used the pro…
Each representative must personally sign the Form 2848 declaration
One representative signed Part II of Form 2848 in his own name for another designated representative, and the IRS processed all three representatives onto its authorization file. Chief Counsel advised…
Late Form 1128 treated as timely filed
The taxpayer filed Form 1128 late when seeking to change from a taxable year ending on the Saturday nearest September 30 to a calendar year. The IRS granted an extension under Treasury Regulation § 30…
Extensions granted for QSub and entity-classification elections
An S corporation failed to timely elect qualified subchapter S subsidiary status for a wholly owned entity, and related entity-classification elections also were not timely made. The IRS concluded tha…
Extension granted to waive CNOL carryback period
A consolidated group intended to relinquish the entire carryback period for a consolidated net operating loss, but its return did not include a valid election under Treasury Regulation § 1.1502-21(b)(…
Two corporations retain S status after restructuring
An S corporation planned to become a state-law general partnership owned by two other S corporations. Its shareholders would become shareholders of one of the two corporate owners, which would have id…
No-fault family-care payments excluded from income
A state-created entity administered a no-fault plan for children with birth-related neurological injuries. Under the governing statute, parents or legal guardians could be paid for medically necessary…
Negotiated-rate solar facility is not public utility property
A regulated electric utility planned to own and operate a solar facility whose entire output would be sold to a federal installation under a negotiated contract. Although the buyer was a federal agenc…
Extension granted for estate portability election
An estate below the estate-tax filing threshold failed to timely file Form 706 to elect portability of the decedent’s unused exclusion amount to the surviving spouse. Because the estate represented th…
Inadvertent invalid S election and termination relieved
A limited liability company’s S corporation election was initially ineffective because some owners did not properly consent. Interests were then issued to three individual retirement accounts, which w…
Elective stock-and-cash dividends treated as property distributions
A corporation planning to elect REIT status proposed dividends allowing each Class A shareholder to choose cash or stock of equivalent value, subject to a cash pool of at least 20 percent of the total…
Extension granted to elect out of bonus depreciation
A foreign corporation claimed bonus depreciation on its original return, then repeatedly tried to electronically file an amended return electing out for all qualified property classes before the exten…
Extension granted for success-based fee safe-harbor election
A corporation incurred success-based advisory fees in a taxable acquisition and intended to use Revenue Procedure 2011-29’s safe harbor, under which 70 percent of the fees are treated as nonfacilitati…
Extension granted for 2010 carryover-basis election
The personal representative of an individual who died in 2010 sought additional time to file Form 8939, elect the special carryover-basis regime under § 1022, and allocate basis increases to eligible …
Extension granted for first-year IC-DISC election
A corporation was formed solely to operate as an interest charge domestic international sales corporation, but Form 4876-A was not filed because its CFO, law firm, and accounting firm each believed an…
Extension granted after adviser missed IC-DISC election
A corporation was formed solely to operate as an IC-DISC and relied on its law and accounting firms to complete the necessary filings. The corporation was unaware that Form 4876-A was separately requi…
Extension granted for partnership § 754 election
A limited liability company classified as a partnership relied on its adviser to make a § 754 election after a partner died, but the adviser failed to include the election for the relevant year. The I…
Lower-tier partnership receives § 754 election extension
A lower-tier partnership was partly owned by an upper-tier partnership whose partner died. To obtain the optional basis adjustment at both tiers, both partnerships needed § 754 elections, but the lowe…
Limited partnership receives § 754 election extension
A state limited partnership relied on its adviser to make a § 754 election after a partner died, but the adviser failed to make the election for the relevant year. The IRS found that the partnership s…
Partnership shareholder caused inadvertent S termination
Two shareholders transferred their S corporation stock to a limited partnership, an ineligible S corporation shareholder. After discovering the resulting termination, the partnership distributed the s…
Trust reformations respected for gift and estate tax
A married couple created an irrevocable trust for their children, but several provisions mistakenly retained amendment, distribution, and reversionary powers inconsistent with their intent to make com…
Extension granted for acquisition-fee safe-harbor election
A corporation paid success-based advisory fees in a taxable acquisition and intended to use Revenue Procedure 2011-29’s 70/30 safe-harbor allocation. Its timely return applied that allocation but omit…
Estate receives portability-election extension
An estate below the estate-tax filing threshold did not timely file Form 706 to elect portability of the deceased spouse’s unused exclusion amount. The surviving spouse, acting as executor, represente…
Foreign settlors own revocable trust and assets receive basis adjustments
Two non-U.S. spouses funded a foreign trust with separate property and retained revocation rights during their joint lives. The IRS ruled that each spouse would be treated as owner of the contributed …
Portability-election extension granted despite taxable gifts
An estate did not timely file Form 706 to elect portability of the decedent’s unused exclusion amount. The surviving spouse, acting as personal representative, disclosed that the decedent had made tax…
Disability justified waiver of 60-day rollover deadline
A taxpayer took a retirement-plan distribution to cover anticipated medical expenses but could not complete a rollover within 60 days. Medical documentation supported that chronic pain from an automob…
Medical conditions justified waiver of IRA rollover deadline
An elderly taxpayer took a distribution from his IRA intending to roll it over within 60 days. He had recently undergone hip replacement surgery, his spouse had chronic orthopedic problems, and their …
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.