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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Child-care provider payments are not exempt from levy
A public-assistance program paid participating child-care providers directly on behalf of eligible low-income working families. The IRS levied the payments owed to a day-care center to collect the…
Barrier contracts create ownership and current tax events
A taxpayer used bank contracts labeled cash-settled barrier call options to obtain leveraged exposure to baskets of hedge-fund interests that its chosen manager could change. Chief Counsel advised…
Majority partnership interest is looked through for section 351
A publicly traded limited partnership planned to receive interests in an acquired master limited partnership from a newly formed corporate entity in exchange for the taxpayer's limited-partner…
Utility receives revised nuclear decommissioning schedule
An electric utility owned and operated an interest in a nuclear power plant whose operating license had been extended. It requested revised annual ruling amounts for deductible contributions to its…
Nuclear plant owner receives revised contribution schedule
An electric utility owned and operated an interest in a nuclear power plant whose operating license had been extended. It requested revised annual ruling amounts for deductible contributions to its…
Bank error qualifies for IRA rollover waiver
An IRA owner intended to renew a maturing certificate of deposit within an IRA, but the bank transferred the funds into a non-IRA savings account. The owner discovered the mistake while preparing…
State excess benefit plans qualify under section 415(m)
A statewide retirement system established excess benefit plans to pay governmental-plan benefits that could not be paid from its qualified defined benefit plans because of IRC § 415 limits. The…
Late section 336(e) election receives filing relief
A purchaser acquired all stock of an S corporation in a transaction represented to be a qualified stock disposition. The target and its shareholder had timely signed a binding agreement to make an…
Partnership may make retroactive QEF election
A partnership indirectly acquired shares of a foreign corporation that qualified as a passive foreign investment company. Its accounting firm prepared several years of returns but did not advise the…
Consent payment may avoid significant debt modification
A corporation planning a tax-free spinoff considered paying holders of contingent-payment debentures for consent to modify an indenture covenant and avoid litigation. The IRS ruled that the payment…
Utility receives revised decommissioning contribution schedule
An electric utility owned and operated an interest in a nuclear power plant with an extended operating license. It requested revised annual ruling amounts for deductible contributions to its nuclear…
Mandatory decommissioning schedule revision is approved
An electric utility with an ownership interest in a nuclear power plant requested a mandatory revised schedule of deductible contributions to its decommissioning fund after the plant’s operating…
Fund’s four late tax elections are treated as timely
A series of a registered investment company prepared a timely return containing elections to be treated as a regulated investment company, carry certain late-year losses forward, treat declared…
Foreign entity receives late partnership election relief
A foreign eligible entity intended to be classified as a partnership for federal tax purposes from its formation date but failed to file Form 8832 on time. Its owners consistently treated it as a…
GRAT ownership causes inadvertent S election termination
Two grantor retained annuity trusts acquired stock in an S corporation while they were eligible grantor-trust shareholders. The trusts later ceased to be grantor trusts but continued holding the…
Trust ownership causes inadvertent S election termination
Shares of an S corporation passed from a grantor retained annuity trust to two successor trusts that were intended to remain grantor trusts but did not qualify during a short period before their…
Foreign entity may make late partnership election
A foreign eligible entity whose owners had limited liability intended to be treated as a partnership for U.S. federal tax purposes but inadvertently failed to file Form 8832 on time. The IRS found…
Late ESBT elections receive inadvertent termination relief
Two trusts acquired shares of an S corporation and otherwise qualified as electing small business trusts, but their trustees failed to file timely ESBT elections. The corporation and its…
Lack of rollover information does not justify waiver
An IRA owner withdrew nondeductible contributions, moved the deductible portion and earnings to a retirement plan, and placed the remaining amount in a non-IRA credit-union account. He missed the…
Home-repair plans do not justify rollover waiver
A former employee elected a lump-sum pension distribution, less mandatory withholding, and deposited the proceeds into her checking account. She missed the 60-day rollover deadline because she did…
Caregiving abroad supports IRA rollover waiver
An IRA owner withdrew funds and deposited them in a non-IRA account in another country shortly before traveling there to care for his elderly mother after a serious fall. He remained abroad as her…
Scholarship procedures receive advance approval
A private foundation proposed scholarships for high-potential, low-income students attending college-preparatory high schools or colleges. Selection would consider financial need and academic…
Computer reseller fails the charitable operational test
An organization proposed to buy refurbished computers, add software and warranties, and resell them primarily above cost to schools, educational programs, students, and families. Sales and fees…
Record label fails the charitable operational test
An organization sought recognition under IRC § 501(c)(3) for a program that would give young artists experience in the entertainment industry. It planned to spend 85 percent of its time operating a…
Children’s product sales create private benefit
An organization planned a secure social network where children would display creative work and vote on projects to be manufactured, licensed, and sold. Most profits from each winning design would go…
Patent research would benefit the founder’s business
An organization was formed to attract funding for research and development of its founder’s patented hydro-energy technology. A related for-profit company was already developing the technology,…
Charitable asset transfer does not create unrelated business income
A voluntary employees’ beneficiary association planned to terminate after all participants had been paid and no benefit claims or liabilities remained. After paying termination expenses, it would…
Charitable transfer avoids the disqualified-benefit excise tax
A business trust planned to terminate a voluntary employees’ beneficiary association after all plan benefits and liabilities had been satisfied. The remaining trust assets, all derived from…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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,…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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…
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,…
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…
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…
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…
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,…
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.