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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IRS approves a spin-off separating two business lines
A publicly traded parent planned to separate two business lines by distributing the stock of a subsidiary to the parent group and then merging the separated businesses into another subsidiary. The…
IRS grants extra time to opt out of bonus depreciation
The parent of a consolidated corporate group intended to elect out of additional first-year depreciation for qualified property placed in service during three tax years. The group did not claim the…
IRS grants extra time for a PFIC mark-to-market election
The IRS considered a regulated investment company's late election to use the mark-to-market method for stock in a passive foreign investment company. The fund's tax adviser did not identify the…
IRS approves a multi-class REIT share structure
The IRS considered two planned real estate investment trusts that would issue multiple classes of common stock with different distribution-channel fees. The taxpayers also planned dividend…
IRS grants extra time for a late corporate classification election
The IRS considered a limited liability company that converted from a corporation and intended to elect association treatment for federal tax purposes from the conversion date. The taxpayer…
IRS restores S corporation status after an inadvertent termination
The IRS considered an S corporation whose election terminated when its shares were transferred to an ineligible shareholder. The shares were later transferred back to the corporation, and the…
IRS restores S corporation status after a delayed shareholder redemption
The IRS considered a corporation whose S corporation election became ineffective because a foreign corporation remained a shareholder longer than intended. The corporation had negotiated a…
IRS approves two spin-offs in a global business separation
A multinational corporate group planned two domestic spin-offs to separate one U.S. business from two others, followed by an international separation of the same business. The IRS ruled that the…
IRS approves allocation of a cooperative's pension contribution
The IRS considered a farmer-owned cooperative's proposed use of litigation settlement proceeds to make a special contribution to an underfunded employee pension plan. The settlement related partly…
IRS approves pipeline partnership income from an air separation unit
The IRS considered a publicly traded partnership that operates petroleum pipelines, storage facilities, and terminals. The partnership planned to acquire an onsite air separation unit at a crude oil…
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…
IRS restores S corporation status after missed QSST elections
An S corporation's shares were transferred to six trusts, but the beneficiaries did not make the required qualified subchapter S trust elections on time. Because the trusts were therefore ineligible…
IRS grants relief for a late S corporation election
A corporation intended to be an S corporation from the date it was formed, but its shareholders did not timely file Form 2553. The IRS found reasonable cause for the late filing. It allowed the…
IRS grants late S corporation and QSub elections
A parent corporation intended to elect S corporation status and to treat two wholly owned subsidiaries as qualified subchapter S subsidiaries. Its Forms 2553 and 8869 were not filed on time because…
IRS preserves S status after a missed ESBT election
A corporation's S corporation election was invalid because a trust shareholder did not timely file an electing small business trust election. The IRS found that the failure was inadvertent and…
IRS requires Forms 1099-C after a settlement debt write-off
A financial institution settled a class action involving deficiency balances from consumer credit accounts and planned to write off those balances. It argued that state law, rather than an…
IRS waives a 60-day IRA rollover deadline after tax advisor error
An IRA owner received a distribution larger than intended after relying on incorrect advice from her tax advisor. She sought a waiver of the 60-day rollover deadline for the excess amount and had…
IRS waives a 60-day IRA rollover deadline after medical emergencies
An IRA owner missed the 60-day rollover deadline while recovering from surgery and caring for her daughter after a serious accident. She deposited the distribution into the IRA nine days after the…
IRS waives a 60-day SEP-IRA rollover deadline after bank delay
An IRA owner withdrew money from a SEP-IRA to help purchase a home and intended to replace it using a home equity loan. The bank delayed releasing the loan proceeds because it required an original…
IRS waives a 60-day rollover deadline after a custodian error
An IRA custodian was resigning and instructed the taxpayer to complete an assignment form to transfer an asset to another IRA. The taxpayer sent the paperwork to an intermediary, but the…
IRS waives the 60-day deadline for a plan loan offset rollover
A former employee's retirement plan loan was offset and treated as a distribution after the employee's job ended. The employee missed the 60-day rollover deadline because the plan's service provider…
IRS waives the rollover deadline after a taxpayer missed a distribution notice while abroad
A retired employee was outside the country when an employer distributed the employee's vested retirement account and mailed the distribution check. The employee did not learn of the distribution…
Exemption revoked after an organization failed to provide requested records
The IRS revoked an organization's section 501(c)(3) exemption after the organization did not provide requested information about its activities, records, and dissolution. The examination materials…
Healthcare-system parent was not a qualified educational organization
A parent organization for an integrated healthcare system asked whether it was a qualified educational organization under section 170(b)(1)(A)(ii). That status would have allowed an exception from…
Foundation may retain nonvoting LLC units without indirect self-dealing
An individual planned to transfer a nonvoting interest in a disregarded LLC to a private foundation after the individual and spouse had died. The LLC's sole asset was a note from the individual's…
Liquidation of unused IPv4 addresses will not create unrelated business income
A tax-exempt supporting organization held several million unused IPv4 address rights that it had received decades earlier for its exempt telecommunications and research activities. It planned to…
Foundation may hold passive LLC interest without self-dealing or excess business holdings
A private foundation planned to receive a nonvoting interest in an LLC after the death of the founder and the founder's wife. The LLC would hold only a note from the founder's daughter and earn…
IRS denies exemption to a fundraising organization serving a for-profit club network
The IRS denied exemption to an organization that raised money for a for-profit youth sports club network and credited fundraising proceeds to club member fees. The organization's activities funded…
IRS revokes a foundation's exemption after private benefits and excess benefit transactions
The IRS revoked a foundation's federal income tax exemption after an examination of its activities and expenditures. The foundation was formed to support people affected by autism and Alzheimer's…
IRS declines to limit retroactive revocation after material operational changes
A tax-exempt organization said it would provide financial education, counseling, and debt-management services for people with low or moderate incomes. The IRS examination found that the organization…
IRS declines retroactive relief after commercial debt-management operations
A tax-exempt organization represented that it would educate the public about budgeting and credit, provide counseling, and administer debt-management plans for people with serious financial…
IRS declines retroactive relief after debt-management fees and undisclosed related trustee
A nonprofit organization represented that it would provide free credit counseling, budgeting help, and debt-management assistance to financially distressed people. The IRS examination found that the…
IRS denies exemption to a Bible translation publisher using a commercial model
The organization sought section 501(c)(3) exemption to oversee the production, publication, and distribution of a Bible translation and related materials. It planned to publish through a for-profit…
IRS denies exemption to a mobile fundraising and marketing platform
The organization proposed a mobile application that would let users direct merchant-sponsored funds to schools and other charities. The IRS found that the program primarily provided marketing and…
IRS explains ERO rules for shared EFINs and subcontracted returns
This Chief Counsel Advice addresses electronic return originators, or EROs, that use the IRS e-file system. It concludes that an ERO may not share its electronic filing identification number, and…
Parent receives extra time to make a consolidated-return election
A corporate parent and its subsidiaries missed the deadline to elect consolidated federal income tax return treatment. The parent said it had reasonably relied on a qualified tax professional who…
REIT may disregard duplicated ground-rent income in gross-income tests
A company planned to qualify as a real estate investment trust through interests in two partnerships. One partnership would own the land, while another would lease the land and sublease the property…
Foreign insurance reserves approved for qualifying insurance company income calculations
A controlled foreign insurance company asked whether reserves reported under its home country's insurance rules could be used to measure income for U.S. tax purposes. The IRS approved the use of…
Disclaimer of a trust remainder will not trigger federal gift tax
A taxpayer planned to disclaim a contingent remainder interest in an irrevocable trust created before January 1, 1977. The IRS ruled that the disclaimer would not be a transfer subject to federal…
Trust modification will not create a general power or end GST tax exemption
The IRS approved a nonjudicial modification of an irrevocable trust created before September 25, 1985. The modification changed how successor trustees would be appointed and ensured that descendants…
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,…
REIT spin-off qualifies for stated tax treatment
A publicly traded real estate investment trust planned to separate two real estate businesses through a contribution of assets to a new controlled REIT followed by a pro rata distribution of the…
S corporation election reinstated after missed ESBT elections
An S corporation's stock was transferred to two trusts whose trustees did not timely file the elections required for electing small business trusts. Because the trusts were not eligible shareholders…
S corporation election reinstated after missed ESBT elections
An S corporation's stock was transferred to two trusts whose trustees did not timely file the elections required for electing small business trusts. Because the trusts were not eligible shareholders…
Estate receives extra time to elect portability of unused exclusion
An estate missed the deadline to file Form 706 and elect portability of the deceased spouse's unused exclusion amount for the surviving spouse. The estate was below the threshold that otherwise…
Donors receive extra time to opt out of automatic GST allocation
Donors transferred property to an irrevocable trust for their children and grandchildren, but their advisers did not elect out of the generation-skipping transfer tax exemption automatic allocation…
IRS waives the 60-day deadline for an IRA rollover misdirected to an ineligible custodian
An individual received a distribution from an IRA and sent the money to a real estate investment after being told that the recipient was an eligible IRA custodian. The individual later learned that…
IRS waives the 60-day deadline after a financial institution misclassified an IRA application
An individual asked to move money from one IRA to another IRA at a different financial institution. An agent mistakenly marked the new account application as “nonqualified” instead of “IRA,” even…
IRS waives the rollover deadline for an RMD distributed from the wrong retirement plan
An individual had required minimum distributions from a qualified plan, a SEP-IRA, and a traditional IRA. A financial advisor mistakenly advised the individual to take all of the required…
IRS waives the rollover deadline after a bankruptcy disrupted a direct rollover
An individual requested a direct rollover from a retirement plan to another plan after the employer sponsoring the original plan went bankrupt. The direct rollover was not completed, and a…
IRS waives the rollover deadline after an IRA transfer went to a taxable account
An individual intended to liquidate an IRA and invest the proceeds in a fund while keeping the investment inside an IRA. The financial institution transferred the assets without obtaining the…
IRS approves a trade association's tournament activities as related to its exempt purpose
The IRS considered whether a tax-exempt trade association could reacquire and operate a set of major sporting events. It ruled that operating the events would not harm the association's exemption…
IRS respects taxable subsidiaries as separate entities from an exempt health maintenance organization
A tax-exempt health maintenance organization planned to create two taxable subsidiaries and transfer employees and administrative contracts to one of them. The IRS considered whether the…
IRS denies exemption to a supplemental unemployment benefit trust
The IRS denied tax-exempt status to a trust formed to provide supplemental unemployment benefits. The trust was sponsored by one corporation, and the record showed that only one employee was covered…
IRS revokes exemption after an organization stopped responding and filing required returns
The IRS revoked an organization's federal tax exemption under IRC § 501(c)(3), effective as of the stated date in the final letter. The organization did not provide information requested during an…
IRS revokes a social club's exemption for excessive nonmember income
The IRS revoked a social club's federal tax exemption under IRC § 501(c)(7), effective January 1 of the stated year. The examination found that the club's nonmember income exceeded the applicable…
IRS revokes exemption after an organization failed to respond to examination requests
The IRS revoked an organization's federal tax exemption under IRC § 501(c)(3), effective January 1 of the stated year. The organization did not respond to repeated requests to inspect its books,…
IRS revokes exemption for failure to provide records and file returns
The IRS revoked an organization's federal tax exemption under IRC § 501(c)(3), effective July 1 of the stated year. The organization failed to produce records showing that it operated exclusively…
IRS proposes revocation after a charity remained inactive
The IRS proposed revoking an organization's federal tax exemption under IRC § 501(c)(3). The organization had not operated for more than three years and had not filed required returns. Its…
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.